October 11, 2012 Articles

Affordable Care Act's Impact on Life Sciences

The Supreme Court’s Patient Protection and Affordable Care Act decision will have a positive effect on the life sciences industry, but may cost the manufacturing sector billions over the next decade.

By Matthew P. Amodeo, Jennifer R. Breuer, Anna Schwamlein Howard, and Robyn S. Shapiro

On June 28, 2012, the U.S. Supreme Court released its much-anticipated decision on the constitutionality of various provisions of the Patient Protection and Affordable Care Act (PPACA). The Court upheld the “individual mandate” as a legitimate constitutional exercise of Congress’s taxing authority. The Court also upheld the requirement for states to expand eligibility under their Medicaid programs, although it struck down the provision that could have required noncomplying states to forfeit 100 percent of the their Medicaid funding. Although much of the analysis of the decision’s impact has been and should be focused on the ruling’s complex underpinnings and effect on public and private sources of health care coverage, it is important to understand the impact within life science segments of the health care industry.

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