American Medical News
By — Posted July 1, 2013
Organized medicine largely was successful advocating in cases during the U.S. Supreme Court term that ended in June, scoring at least partial victories in nearly all of the cases on which physician leaders weighed in.
The American Medical Association — often through the Litigation Center of the AMA and the State Medical Societies — officially voiced its positions in seven high court cases, involving such varied issues as gay marriage, medication access and class-action arbitration.
The cases ruled on this term will affect patients, physicians and the health care community at large in significant ways, said Margaret Foster Riley, a health law professor at the University of Virginia School of Law.
“Of course, compared to last year, which included the court’s decision on the constitutionality of Obamacare, and therefore impacted the entire health care landscape, this is not such a dramatic year” for health care, she wrote in an email. “That said, there have been a number of cases this year that will have an important effect on health and medicine in the next years and even decades.”
The case that observers said might have the broadest impact on science and medical care was Assn. for Molecular Pathology et al. v. Myriad Genetics Inc. et al., involving the right of companies to patent isolated DNA sequences.
The association and others sued Myriad Genetics in 2009, challenging the validity of Myriad’s patents on two genes — BRCA1 and BRCA2 — linked to breast and ovarian cancer. Critics of the patents, including physician associations, said Myriad’s sole rights to the genes and its diagnostic analysis harmed scientific innovation and left patients unable to seek their test results elsewhere.
In a unanimous decision issued June 13, Supreme Court justices ruled that Myriad does not hold a valid right to patent naturally occurring genes. However, the high court left open the potential for patents on synthetic DNA sequences and methods that manipulate genes or apply their information in a novel way.
Physicians hailed that mixed ruling as a victory for patient access and innovation, but Myriad insisted it still retained numerous patent protections for its screenings under the ruling.
Patents involving brand-name medications and the ability to control generic drug availability also came under review this term.
On June 17, the high court issued its decision in Federal Trade Commission v. Actavis Inc. et al., a case centering on so-called pay-for-delay deals. The settlements refer to brand-name drugmakers paying generic companies to end patent litigation, effectively postponing the introduction of lower-cost, equivalent generics. The FTC sued over such a deal between Watson Pharmaceuticals, now Actavis, and Solvay Pharmaceuticals involving a patent on AndroGel, a treatment for the underproduction of testosterone. The FTC said the deal was anti-competitive and thus subject to federal antitrust action.
The AMA and other organizations urged the high court to enable the FTC action to proceed, and the Supreme Court agreed. In a 5-3 ruling, justices said the agency’s antitrust concerns over the deals were valid. However, the high court did not deem such pay-for-delay agreements inherently unlawful.
Organized medicine praised the decision as enforcing proper oversight of drug manufacturers that attempt to keep generic medications off the market.
In Federal Trade Commission v. Phoebe Putney Health System Inc. et al., justices reviewed whether a multimillion-dollar merger between two Georgia hospitals was subject to federal antitrust laws. Lower courts found that because one hospital is publicly owned, the acquisition was protected from federal antitrust scrutiny by the “state action doctrine.”
But in a unanimous Feb. 19 decision, the high court ruled that the hospitals’ merger was not immune to antitrust scrutiny, remanding the case to an appeals court for a finding consistent with its opinion.
The Litigation Center issued a friend-of-the-court brief in the case related to the scope of the state action doctrine. The center did not side with either party, but it expressed concern that an overly narrow interpretation of the state action doctrine by the high court inadvertently could impede the authority of state medical licensing boards.
“We are pleased that the high court’s decision did not undercut the AMA’s position supporting state boards as the ultimate authority on professional licensure, patient safety and the practice of medicine,” then-AMA President Jeremy A. Lazarus, MD, said in a statement.
Doctors scored another win when the high court ruled that a New Jersey pediatrician would not have to fight his insurer payment battle alone.
On June 10, justices ruled unanimously in Oxford Health Plans LLC v. Sutter that doctors’ payment disputes with insurers can be arbitrated as a group for cases in which contracts are silent on the issue of class arbitration. The decision allows John I. Sutter, MD, to continue pursuing his payment dispute with Oxford Health Plans as part of a class of about 20,000 other physicians in the insurer’s network.
Dr. Sutter had sued Oxford in 2002, alleging that the insurer systematically bundled, downcoded and delayed payments for services provided by him and other physicians. He sought to represent both himself and a class of similarly situated health professionals, but Oxford argued that payment disputes could be resolved only through individual arbitration.
The decision preserves a potent legal weapon for doctors to challenge health insurers’ unfair payment practices, physicians said.
Fisher v. University of Texas at Austin et al. was one of the most closely watched cases of the term. The case involves a white applicant to an undergraduate program who challenged the school using race as a factor in admissions decisions. The Supreme Court did not rule directly on the constitutionality of the program, instead sending the case back to an appeals court for reconsideration using stricter review instructions.
In its 7-1 ruling on June 24, the high court said that in evaluating affirmative-action programs, lower courts must verify that it is necessary to use race to achieve the educational benefits of diversity and that such diversity cannot be achieved without using racial classifications. Courts may give some deference to a university’s judgment that such diversity is essential to its educational mission, “provided that diversity is not defined as mere racial balancing and there is a reasoned, principled explanation for the academic decision.”
The AMA and other physician organizations applauded the Supreme Court’s decision, saying it affirmed diversity as a compelling interest in higher education.
“The AMA joined other health care organizations in an amicus brief urging the high court to uphold medical school admission policies that consider race, ethnicity and gender as one factor among an applicant’s many personal attributes,” Dr. Lazarus said in a statement. “Increasing medical career opportunities for minorities is an important step in developing a diverse physician work force that will help bridge the gap in racial health disparities.”
The Assn. of American Medical Colleges also praised the ruling. “In light of this decision, U.S. medical schools will continue their institution-specific efforts to ensure that graduating physicians are prepared to practice medicine in an increasingly diverse society,” AAMC President and CEO Darrell G. Kirch, MD, said in a statement.
The Supreme Court on June 26 also made two high-profile rulings affecting same-sex marriage rights.
In a 5-4 ruling on United States v. Windsor et al., justices struck down as unconstitutional a provision in the 1996 Defense of Marriage Act that had prevented the federal government from recognizing, for the purposes of federal laws or programs, state-approved same-sex marriages. “The federal statute is invalid, for no legitimate purpose overcomes the purpose and effect to disparage and to injure those whom the state, by its marriage laws, sought to protect in personhood and dignity,” the ruling stated.
In a separate 5-4 ruling on Hollingsworth et al. v. Perry et al., the Supreme Court effectively let stand a lower court decision that had blocked California from implementing Proposition 8, a voter-approved ban on same-sex marriages. By stating that the ban’s supporters did not have standing to appeal that decision, the high court ruling paves the way for the state to resume recognizing such marriages going forward, though it does not directly affect any other states’ laws.
Physician organizations, including the AMA, had filed briefs with the high court urging justices to uphold appellate decisions finding DOMA and the California ban unconstitutional. Denying same-sex couples the right to civil marriage is detrimental to the couples’ health and the health of their children, the associations said.
The rulings will aid in emotional and psychological well-being, said Jack Drescher, MD, a member of the American Psychiatric Assn.’s DSM-5 Sexual and Gender Identity Disorders Work Group.
“One can only imagine that this is going to reduce anxiety and stress for a lot of gay people, because the highest court in the land says, ‘You are equal to everybody else,’ ” he said, adding that “children like to know they are a family, that their families are stable. When the state allows official recognition to the … parents’ relationship, that makes the child feel safer.”