In brief: U.S. Supreme Court upholds health care law (No. 2012-17)
In brief
Today, the U.S. Supreme Court ruled that the individual mandate -- the provision of the Affordable Care Act (ACA) that requires most Americans to purchase health insurance -- is constitutional. As a result, the entire law was upheld. Many provisions of the ACA affected financial statement accounting and disclosures when the law was enacted and as various provisions have gone into effect. Since the law was upheld by the Court, the ruling should not have any accounting or financial reporting implications. Read this In brief article for further information.
What's new?
Today, the U.S. Supreme Court ruled that the individual mandate — the provision of the Affordable Care Act (ACA) that requires most Americans to purchase health insurance — is constitutional. As a result, the entire law was upheld.
What was the decision?
The Supreme Court decided the individual mandate is valid as a tax. The Court ruled that it is within Congress's power to impose such a tax.
The ACA also expands the scope of the Medicaid program and increases the number of individuals each state must cover under the program. The Court's ruling places certain limits on this provision of the ACA.
Many provisions of the ACA affected financial statement accounting and disclosures when the law was enacted and as various provisions have gone into effect. Since the law was upheld by the Court, the ruling should not have any accounting or financial reporting implications.
Who's affected?
All entities that provide health care benefits are affected by the ACA. However, as noted above, since the law was upheld, the ruling itself should not affect an entity’s existing accounting for health care benefits.
What's next?
It is possible that Congress will continue efforts to repeal the ACA. It would not be appropriate to anticipate future actions by Congress in assessing the current accounting and financial reporting implications of the ACA.
Questions?
PwC clients who have questions about this In brief should contact their engagement partner. Engagement teams that have questions should contact the National Professional Services Group (1-973-236-7802). For more PwC analysis on health care reform issues and the impact of the Supreme Court's decision, visit http://www.pwc.com/healthreform.
Authored by:
Jay Seliber
Partner
Phone: 1-973-236-7277
Email: jay.seliber@us.pwc.com
Nicole Berman
Director
Phone: 1-973-236-4202
Email: nicole.s.berman@us.pwc.com
In brief is designed to provide a timely, high-level overview of significant financial reporting developments. It is issued by the National Professional Services Group of PricewaterhouseCoopers LLP. This publication has been prepared for general information on matters of interest only, and does not constitute professional advice on facts and circumstances specific to any person or entity. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication. The information contained in this material was not intended or written to be used, and cannot be used, for purposes of avoiding penalties or sanctions imposed by any government or other regulatory body. PricewaterhouseCoopers LLP, its members, employees and agents shall not be responsible for any loss sustained by any person or entity who relies on this publication.