Consumer Law & Policy Blog

An Affordable Care Act Without the "Mandate" But With the Ban Against Discrimination Against People With Pre-Existing Conditions?

David Lazarus of the LA Times says here that he thinks the Supreme Court will throw out the Affordable Care Act's insurance "mandate" but keep intact the "gaurantee" to offer coverage to anyone who applies regardless of their medical condition. I don't think that's as likely as Lazarus does. But I do agree with Lazarus that such a mixed result could make for "an even more dysfunctional [health] insurance system."

More on the Lawsuit Challenging the Constitutionality of the CFPB

Allison posted earlier on the lawsuit challenging the constitutionality of the Consumer Financial Protection Bureau. Read the complaint and a press report from Bloomberg News in which co-blogger Deepak Gupta is quoted.

Lawsuit challenges Dodd-Frank and CFPB

A Texas Bank, the Competitive Enterprise Institute, and the 60 Plus Association are reportedly filing a lawsuit -- this afternoon -- challenging various provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act. According to an article in The Hill, "the suit will contend that the Consumer Financial Protection Bureau (CFPB), created by the law, lacks sufficient checks and balances and . . . simply unconstitutional." In addition to challenging the CFPB, the lawsuit will reportedly challenge the Dodd-Frank provisions that create Financial Stability Oversight Council (FSOC). The FSOC is a group of regulators that oversee the financial system and identify financial institutions that pose unique risks to the system and merit heightened oversight. The lawsuit will be filed in US District Court in DC and will name federal regulators as defendants. The American Banker has also reported on the lawsuit.

Housing Wire Report: CFPB TILA/RESPA Combined Form Won't Happen Until 2013

Here.  An excerpt:

The proposed rule must reconcile several inconsistencies that exist between TILA and RESPA to create the combined forms. The two federal acts establish different timing requirements for disclosing final loan terms and costs to consumers and require different parties to provide the TILA and RESPA disclosure forms.

It's Not Computers Whose Speech is Protected -- It's Their Owners

by Paul Alan Levy

Suppose a company were to design a formula to rank other companies with respect to their overall desirability to potential customers.  After creating a complicated formula, the company would accumulate a database of factual information, relying largely on information gathered from the other companies, but also relying on inputs from other sources; each of these inputs would be quantified using a proprietary method; finally, the company would plug all of this quantitative data into a computer that would crunch the numbers and publish a ranking. 

Suppose as well that this ranking gains an important reputation in the marketplace.  So if you have your own business, your company’s position on the resulting ranking list, compared to its rivals, can mean differences of millions of dollars in new business; ranking can, indeed, make or break your business. 

If you don’t like where you rank, can you sue the creator of the ranking for libel?  Can the ranking creator defend itself on the ground that the ranking is, after all, an opinion, and opinions are constitutionally protected because “Under the First Amendment there is no such thing as a false idea.”  Or does the First Amendment not apply at all because the ranking formula was applied by a computer, and computers don’t have free speech rights?

As the alumnus of a college that proudly rejects the proposition that the quality of educational institutions can be “measured by a series of data points,” I will take any opportunity to denigrate the Useless News and World Distort rankings of colleges, law schools and institutions of higher education.  But it would never have occurred to me to offer a “speech by computer” theory as a basis for denying that the ranking is speech or that it is protected opinion.  Maybe a stupid opinion, but that is not a basis for shutting the raters down, or enjoining them to change their rating criteria.  Indeed, this theory seems to me absurd — it is not the computers that have free speech rights, any more than printing presses have free speech rights.  It is the media companies that own the printing presses that have free speech rights, and by the same token it is the people and companies who program the computers and publish the results of their calculations that enjoy protection under the First Amendment.  But the proposition that computers don’t have free speech rights underlies a recent op-ed by Columbia University Law School professor Timothy Wu, who argues that Google’s search ranking results should be denied First Amendment protection.

Climate change hits home on the eastern seaboard

When I think of areas of the world affected by climate change most acutely, I think about Pacific island nations, low lying nations like Bangladesh, and the polar ice caps.

But an eye opening article in the Washington Post this week focuses much closer to home: Norfolk, Va., the second largest city in the Commonwealth. Residents already contend with regular flooding, car brakes have to be replaced due to saltwater damage, and the mayor openly discusses whether parts of the city will need to be abandoned ultimately. Scary stuff.

"Comity" as a reason to preclude class actions?

In June 2011, the U.S. Supreme Court in Smith v. Bayer held, unanimously, that the denial of a class certification motion brought by a plaintiff in one case did not bar a different plaintiff from seeking class certification in a similar case against the same defendant. That decision reversed an Eighth Circuit opinion and rejected the reasoning set forth in a couple of Seventh Circuit opinions in consumer class action cases. On Tuesday, in a case called Smentek v. Dart, the Seventh Circuit answered the question whether a district court, in deciding whether to certify a class, should "defer, based on the principles of comity, to a sister court’s ruling on a motion for certification of a similar class." The defendants' theory was that Smith v. Bayer suggested that comity was a basis for precluding "copycat class actions," but the Seventh Circuit said that this theory read too much into the Supreme Court's reference to expecting "federal courts to apply principles of comity to each other’s class certification decisions.” Rightly recognizing that adopting the defendants' theory would contradict the outcome in Smith v. Bayer, the Seventh Circuit held that "the defendants’ argument that Smith v. Bayer Corp. adopted a rule of comity in class action suits that precludes granting class certification in a copycat class action must be rejected."

AMA Endorses Anti-Obesity Education K Through 12

America's doctors want all kids to be educated about how to avoid obesity. Read about it here. And start with this exceprt:

The nation’s largest physicians group agreed to support legislation that would require classes in causes, consequences and prevention of obesity for first through 12th graders. Doctors will be encouraged to volunteer their time to help with that under the new policy adopted on the final day of the AMA’s annual policymaking meeting. ... “I can’t tell you the number of 40-pound 1-year-olds I see every day,” Dr. Melissa Garretson, a Stephensville, Texas pediatrician, told the delegates before Wednesday’s vote. She said requiring obesity education “is a great idea.”

$1.1 Billion in Insurance Rebates Under the Affordable Care Act

In April, we told you about an estimated $1.3 billion in rebates that are coming to consumers and employers under the Affordable Care Act's medical loss ratio rule, which, somewhat oversimplified, requires medical insurers to spend more than 80% of what they take in on health care or kick back the excess to people and companies that pay the insurance premiums. For more detail about who will get paid and how much -- the total now is estimated at only $1.1 billion -- read this story.

Massive Waste in the U.S. Health Insurance System

One of the major arguments for single-payer health insurance, such as in Canada (and, to some degree, as under Medicare), is that it avoids billions of dollars in wasteful paperwork. This article by Mike Alberti explains the argument in detail and includes the following astounding anecdote: "Massachusetts General Hospital employs more than 300 staff members dedicated solely to billing. Toronto General Hospital, which is comparable in size, employs only three."