Yesterday, the United States Supreme Court issued hotly anticipated decisions on two federal government vaccine requirements in response to the ongoing COVID-19 pandemic.
In a 6-3 decision, the Court blocked the Emergency Temporary Standard (“ETS”) issued by the Occupational Safety and Health Administration (“OSHA”) that required employees of larger employers (i.e., those with 100 or more employees) to provide proof of full COVID-19 vaccination status or submit to weekly testing. In a separate 5-4 decision, the Court permitted an interim rule issued by the Centers for Medicare & Medicaid Services (“CMS”) that requires COVID-19 vaccination for workers in hospitals, nursing homes, and other healthcare facilities that receive Medicare and Medicaid funding.
I. The OSHA ETS
A. The Background and the Supreme Court’s Decision
Issued in November, the ETS was met with a flurry of swift legal challenges. The Fifth Circuit Court of Appeals issued a temporary stay of the ETS on November 12, finding that the ETS exceeded OSHA’s limited authority to establish emergency temporary standards. Shortly thereafter, the Sixth Circuit Court of Appeals was selected via lottery to hear the consolidated challenges to the ETS. On December 17, a three-judge panel of the Sixth Circuit, in a 2-1 decision, dissolved the Fifth Circuit’s stay and allowed the ETS to take effect. OSHA then moved forward with implementing the ETS and set new compliance dates for January 10, 2022, and February 9, 2022, and challengers quickly filed applications for emergency relief with the Supreme Court. The Supreme Court held oral argument on the emergency applications on January 7, 2022, and the Court handed down its ruling yesterday.
The Court found that the applicants seeking a stay were likely to prevail on their argument that the ETS exceeded OSHA’s statutory authority and was otherwise unlawful. The Court began its analysis noting that the ETS would have required most employees working for large employers to get vaccinated or test weekly at their expense, and this was “no everyday exercise of federal power”. The Court went on to conclude the Occupational Safety and Health Act (the “Act”) did not clearly authorize OSHA to issue such a vast public health requirement.
OSHA’s authority under the Act is limited to regulating workplace safety. Because COVID-19 can and does spread in many settings, the Court found that it was a universal risk – not an occupational hazard in most workplaces. The Court explained that “[p]ermitting OSHA to regulate the hazards of daily life—simply because most Americans have jobs and face those same risks while on the clock—would significantly expand OSHA’s regulatory authority without clear congressional authorization.”
The Court clarified that OSHA has the authority to regulate occupation-specific risks related to COVID-19 “[w]here the virus poses a special danger because of the particular features of an employee’s job or workplace.” However, OSHA’s “indiscriminate approach” with the ETS exceeded its statutory authority.
Justice Gorsuch wrote a separate concurring opinion, which was joined by Justices Thomas and Alito. In his concurring opinion, Justice Gorsuch discussed the major questions doctrine, separation of powers, and Constitutional issues and concluded that the power to respond to the pandemic rests with the States and Congress, not OSHA.
In their dissenting opinion, Justices Breyer, Sotomayor, and Kagan noted the toll COVID-19 has taken on the citizenry, particularly its workers, and its transmission in confined indoor spaces. After asserting that the virus poses a “grave danger” to employees and that the ETS is necessary to address the dangers, the dissenting Justices maintained that the Occupational Safety and Health Act grants OSHA the authority to issue the ETS.
B. What’s Next?
The Court granted the emergency stay applications pending the disposition of the matters before the Sixth Circuit and the applicants’ petitions for writs of certiorari if such writs are timely sought. In other words, the stay will remain in place, even if the Sixth Circuit formally rejected the challenges, unless and until the Supreme Court either denied subsequent petitions for writs of certiorari by the challengers, the challengers failed to petition for writ of certiorari after an adverse decision by the Sixth Circuit (which would be very unlikely), or the Court ultimately issued a final decision after a final decision by Sixth Circuit. Practically speaking, unless the Supreme Court dramatically reverses itself later in the proceedings (which seems extremely unlikely), the ETS is and will remain blocked.
In response to the Supreme Court’s decision, the Secretary of Labor issued a statement indicating that: “OSHA will be evaluating all options to ensure workers are protected from this deadly virus.” The question remains whether OSHA will attempt to issue a narrower rulemaking that might survive judicial scrutiny under the guide rails provided by the Court. Measures that are unique to the workplace (such as mask requirements) or a vaccine or test mandate limited to workplaces where the virus poses a special danger due to the nature of the work, could arguably pass muster. However, the rulemaking process takes time, and it is unlikely that OSHA could issue a more narrow rule in the near term. In the meantime, the Secretary of Labor also made clear that OSHA will “do everything in its existing authority to hold businesses accountable for protecting workers, including under the Covid-19 National Emphasis Program and General Duty Clause.”
II. The CMS Vaccine Rule
A. The Background and the Supreme Court’s Decision
In November, CMS issued an interim final rule requiring certain health care facilities participating in federal Medicare and Medicaid programs to mandate that their covered staff are fully vaccinated against COVID-19. The CMS vaccine mandate applies to 15 different kinds of healthcare facilities and provides employee exemptions for medical and religious reasons.
As with the ETS, legal challenges were filed to the interim rule in various federal courts, and multiple federal courts ultimately issued preliminary injunctions blocking the rule’s enforcement. In November, a Louisiana federal court issued an injunction prohibiting the rule’s enforcement nationwide. However, in mid-December, the Fifth Circuit Court of Appeals issued a decision upholding the injunction only in the 25 states that were party to the underlying litigation (Alabama, Alaska, Arizona, Arkansas, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, Missouri, Montana, Nebraska, New Hampshire, North Dakota, Ohio, Oklahoma, South Carolina, South Dakota, Texas, Utah, West Virginia and Wyoming). The interim rule was enforceable in Pennsylvania and the remaining 24 states and U.S. territories. As with the ETS, these challenges quickly made their way to the Supreme Court.
In a 5-4 per curiam decision, the Court stayed the existing preliminary injunctions and allowed the CMS vaccine mandate rule to take effect. (Chief Justice Roberts and Justice Kavanaugh joined the three dissenting Justices in the ETS decision to form the 5-4 majority here.) The Court found that CMS had the statutory authority to issue the interim rule and its vaccine mandate, citing the long list of conditions that CMS previously has established for healthcare providers to participate in the federally funded Medicare and Medicaid programs.
The Court focused on CMS’s core function of ensuring that “the healthcare providers who care for Medicare and Medicaid patients protect their patients’ health and safety.” The Court also cited federal statutory language that gave the Secretary of Health and Human Services the authority to promulgate such conditions.
Because the vaccine mandate for healthcare workers was designed to facilitate and protect the health and safety of patients, the Court found that this rule was consistent with the language of the statute and with prior conditions established by CMS for participation in the Medicare and Medicaid programs, including requirements for healthcare workers.
Justices Thomas and Alito authored separate dissenting opinions, which were joined by Justices Gorsuch and Barrett. The dissenting Justices rejected the conclusion that CMS had the statutory authority to issue a vaccine mandate, finding no express language in the relevant statutory language granting such authority. Justice Alito also focused on the delays in issuing the vaccine mandate and described CMS’s actions to be an “extraordinary departure from ordinary principles of administrative procedure.”
B. What’s Next?
As a result of the Court’s decision, Medicare and Medicaid-certified facilities regulated under the Medicare health and safety standards, known as Conditions of Participation, will need to establish plans and procedures to ensure that their staff and contractors who provide care, treatment, or other services are fully vaccinated unless they are entitled to a religious or medical exemption. CMS has not yet indicated whether a new timeline for compliance will be issued for the 25 states that had been covered by the prior injunctions.
On December 28, 2021, CMS updated its guidance concerning implementation of the vaccine mandate. The guidance requires all covered facilities to develop a policy and process for tracking staff vaccinations and ensure that covered staff receive at least the first dose of the vaccine by January 27, 2022, unless the staff member has a pending request for, or has been granted a qualifying exemption to accommodate a disability or sincerely held religious belief. Covered staff must then be fully vaccinated by February 28, 2022. CMS defines “fully vaccinated” as having completed the primary series of the vaccination – one dose of J&J or both doses of Moderna or Pfizer-BioNTech – even if the 14-day waiting period has not yet been completed. Staff at all health care facilities covered by the mandate cannot provide any patient care, treatment, or other “services” within the covered facility unless they comply with the mandate.
The interim rule applies to staff working at nearly all CMS-certified facilities that participate in the Medicare and Medicaid programs including employees, licensed practitioners, students, trainees, and volunteers. It does not, however, apply to staff who provide 100% of their services remotely and do not have any contact with patients or other staff. It further does not apply to visitors, Assisted Living Facilities, group homes, Home and Community-based Services, schools who receive Medicaid funding, or EMS providers as they are not subject to the health and safety standards of CMS.
Companies performing construction at covered facilities or providing other non-health care services may additionally be excluded if they are considered infrequent, or “one off” vendors. CMS surveyors will look at the frequency that such non-health care contractors enter or visit facilities to determine whether they fall within the ad-hoc or “one off” exception.
Enforcement of the interim rule will begin January 27, 2022, through state survey agencies, accrediting organizations and CMS-contracted surveyors checking for compliance as part of initial certifications, recertifications or reaccreditations, and in response to complaints.