Despite high court ruling, businesses still face uncertainty over healthcare law

The Supreme Court put to rest one of the biggest questions in Washington Thursday, but uncertainty still looms large over businesses navigating a rocky economy.

The problem of uncertainty has been repeatedly cited as a reason the economy has failed to gain major speed, as businesses stay on the sidelines when it comes to further investments and hiring. When the nation’s highest court narrowly upheld the president’s signature legislative achievement, it finished up its work on one of the most contentious fights in Washington.

At least for the time being, businesses can now move ahead knowing that the healthcare law is not in immediate danger of being pulled from the books, and can take steps to fall in line with its new requirements.

“For the last two years, we’ve been in limbo,” said Amanda Austin, director of federal public policy for the National Federation of Independent Business (NFIB). “It’s a very sobering effect today.”

But even with the court laying down the law, there still remain plenty of questions waiting for answers surrounding the healthcare overhaul.

For one, businesses still need to wait to see how regulators will draft a slew of rules implementing the law, and exactly how its requirements will be made a reality.

“Of course, there is less uncertainty in the sense that we know the answer,” said Maria Ghazal, vice president and general counsel for the Business Roundtable. “But there’s still a lot of work to be done.”

While the court’s ruling captivated Washington like little else in recent memory, Ghazal downplayed any notion that the nine justices put a true stamp of finality on what it means for businesses.

“It seems to be another data point,” she said. “I don’t think people see it as the end of something nor the beginning, it’s just another piece of information.”

“They’re certain about the uncertainty ahead,” said Austin.  “They’re sobering up to the fact that this law is here to stay, and I think that we will see them really grasping for information from news outlets and trade associations and others on how to comply with this law.”

The NFIB helped lead the charge to overturn the law, and supports its repeal.

Another open question facing businesses is the course of the economic recovery. A recent slowdown in economic data has thrown fresh doubts on the trajectory of the nations’ growth. A persistently high unemployment rate, tight state budgets, and the drama over in Europe still serve as major threats. Exactly how businesses adjust their hiring and investment to accommodate the healthcare law remains an open question, so long as the economic recovery remains one as well.

“The ruling certainly takes away uncertainty regarding timelines and what is required in the current situation, but it does not take away uncertainty regarding how the various economic outcomes would be,” said Renu Joseph, an economist with Moody’s Analytics. “Hiring decisions, I believe will be primarily decided by how…the economy has picked up. In the worst case, businesses will not hire anymore, if the economy does not do well.

“Healthcare costs are crucial part of the hiring decisions, but not the crux,” she added.

And perhaps the most visible variable swirling around the law is the slew of legislative threats to it emanating from Republicans. Immediately after the Supreme Court ruled, Republicans vowed to double their efforts to repeal the law, with House GOP leaders scheduling another vote on a measure to do just that in the coming weeks. Presumptive GOP candidate Mitt Romney joined the fray, saying that the only way to get rid of the law is to get rid of the president who signed it.

Given the heightened partisan atmosphere at the Capitol and the looming election, no one is expecting the Republican efforts to scrap the law to make any headway in the current Congress. However, the results of the November election will play a vital role in the ultimate fate of the law, as substantial GOP gains could cast its fate in jeopardy.

But for the time being, businesses and state governments must deal with the reality on the ground, which means taking steps to become compliant with the healthcare reforms that the Supreme Court have deemed legitimate.

Joseph pointed out that state governments may have held off on setting up health insurance exchanges until the justices ruled, but won’t be able to wait for election results.

“Their deadline to put in place is mid-November. I can’t imagine them sitting tight and not making any decisions, since if President Obama wins, they just won’t make it in time,” she said. “Implementation of this law is incredibly complex and time consuming and non-implementation will lead to penalties, significant in some cases.”

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