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Supreme Court Blocks OSHA Vaccine-or-Test Rule, Upholds Vaccination Mandate for Healthcare Facilities


On January 13, 2022, the Supreme Court blocked enforcement of the Biden Administration’s COVID-19 vaccinate-or-test rule for workers at large businesses, although kept in place a vaccination mandate for most staff at healthcare facilities participating in Medicare and Medicaid programs.

The Mandates

The U.S. Department of Health and Human Services (HHS) issued a vaccination mandate under which most Medicare- and Medicaid-certified providers and suppliers must develop and implement policies and procedures to ensure staff and select other individuals are vaccinated for COVID-19.

Additionally, the Secretary of Labor, acting through the Occupational Safety and Health Administration (OSHA), issued a vaccinate-or-test rule that would have required all employers with at least 100 employees to ensure their employees either be vaccinated for COVID-19 or submit to weekly tests and wear masks at work.

Supreme Court’s Rationale

1- HHS’s Vaccination Mandate

The Court found that Congress delegated the necessary authority for such a vaccination mandate to the Secretary of HHS when it authorized the Secretary to impose conditions on the receipt of federal health care funds that “the Secretary finds necessary in the interest of the health and safety of individuals who are furnished services.” Additionally, the Secretary may implement “requirements as [he] finds necessary in the interest of the health and safety of individuals who are furnished services in the institution.”

Healthcare facilities that wish to participate in Medicare and Medicaid have long been required to satisfy a host of conditions that address the safe and effective provision of healthcare and the qualifications and duties of healthcare workers. The vaccination mandate fits within the language of the statute and is consistent with previous requirements tied to Medicare and Medicaid participation.

Challengers argued that the vaccine mandate was arbitrary and capricious, tangentially related to the Medicare and Medicaid programs, and relied on a piecemeal reading of various statutes rather than a clear Congressional delegation. However, the majority found ample evidence that the Secretary examined relevant data and articulated a satisfactory explanation for the mandate. In conclusion, the mandate and interpretation of the delegated authority were consistent with previous interpretations and requirements and reiterated that the role of courts in reviewing arbitrary and capricious challenges is to “simply ensure that the agency acted within a zone of reasonableness.” After finding that HHS acted reasonably and within the statutory authority delegated by Congress, the mandate was permitted to come into effect.

2- OSHA’s Vaccinate-or-Test Rule

While the result differed, the Supreme Court implemented a similar rationale when analyzing OSHA’s rule. Although Congress has given OSHA the power to regulate occupational danger, it has not given the agency the power to regulate “every day dangers” or “public health more broadly.” Here, the rule was too broad as the Occupation Safety and Health Act empowers the Secretary of Labor to set workplace safety standards for workplace hazards, which does not include risks that are not uniquely occupational. The “universal risk [of COVID-19] is no different from the day-to-day dangers [of] crime, air pollution, or [other] communicable diseases. Permitting OSHA to regulate hazards of daily life . . . would significantly expand OSHA’s regulatory authority without clear congressional authorization.” The dissent argued in response that the fact that COVID-19 is not present only in the workplace does not mean that OSHA could not act to mitigate the danger in the workplace where Covid-19 can spread uncontrollably, and explained that OSHA had relied on numerous scientific studies to provide a reasoned basis for its mandate.

While neither HHS nor OSHA went through the requisite notice-and-comment procedures typical of agency rulemaking, the Court found that HHS demonstrated good cause for an emergency temporary standard, however, OSHA did not, because the court found no legislative authorization for the mandate. Moreover, it failed to show (a) that employees are exposed to grave danger from exposure to substances or agents determined to be toxic or physically harmful or from new hazards, and (b) that the emergency standard is necessary to protect employees from such dangers. OSHA’s rule was also critiqued as indiscriminately covering all industries, regardless of industries’ risk of exposure to COVID-19, potentially leading to billions of dollars spent and thousands of laid-off employees. In contrast, the Court held that HHS’s mandate was tailored to a specific industry based on specific data on the risk of exposure to COVID-19 and had the requisite statutory authority.

Implementing HHS’s Mandate

HHS’s mandate applies to most current and new staff who provide any care, treatment, or other services for the facility and/or its patients. The mandate applies irrespective of the site the care is rendered or if the staff member provides direct patient care, though there are limited exceptions for individuals who work remotely or provide services infrequently. Medical and religious exemptions are also permitted. Such facilities must require applicable individuals to complete a primary vaccination series for COVID-19, though providers and suppliers must track and document both primary vaccination information and booster doses. Compliance is required as a Condition of Participation, and failure to comply may result in monetary penalties, denial of payment, and termination of participation in federal healthcare programs.

Contact a Morris, Manning & Martin healthcare lawyer for assistance with developing policies and procedures to comply with HHS’s vaccination mandate.