On January 13, 2022, the U.S. Supreme Court issued two rulings on COVID-19 vaccine mandates that immediately impact employers throughout the country.

In National Federation of Independent Business (NFIB) v. OSHA, the Supreme Court effectively struck down OSHA’s vaccine-or-test mandate applicable to all employers with 100 or more employees.

In Biden v. Missouri, the Supreme Court upheld the Centers for Medicare & Medicaid Services’ (CMS) COVID-19 vaccine mandate applicable to most staff of covered Medicare- and Medicaid-certified providers and suppliers.

OSHA Vaccine-or-Test Mandate Does Not Survive Supreme Court’s Review

In its 6-3 decision in NFIB v. OSHA, the Supreme Court reinstituted a lower court’s stay of OSHA’s Emergency Temporary Standard on COVID-19 Vaccination and Testing (ETS), which required employers with 100 or more employees to develop and implement a policy requiring that employees either become fully vaccinated or undergo weekly testing and wear a face covering at work. The Supreme Court concluded that the Secretary of Labor, acting through OSHA, lacked the authority to impose the mandate. The Court acknowledged the Secretary has the power to set workplace safety standards, but held that COVID-19 is not an occupational hazard in most workplaces. The Court held:

Permitting 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 ETS would have applied to roughly 84 million workers, and many employers had already taken steps to comply with its requirements, most of which OSHA had announced it would begin enforcing on January 10, 2022.

So what now? Is the ETS dead? Could employers not covered by the CMS vaccine mandate (see below) still face employee vaccination and testing requirements? In the absence of legal requirements, can employers impose their own COVID-19 vaccination and/or testing requirements? Yes, yes and maybe.

Is the ETS Dead?

As a technical matter, the Supreme Court’s ruling only temporarily blocks OSHA from enforcing the ETS, pending disposition on the merits of claims asserted by those challenging the rule before the Sixth Circuit Court of Appeals. However, in light of the Supreme Court’s ruling, it is highly unlikely that the Sixth Circuit revives the ETS. And, even if it does, the ETS almost certainly would be subject to review once again by a Supreme Court that has already concluded, by a clear 6-3 majority, that the ETS’s challengers “are likely to succeed on the merits of their claim that the Secretary lacked authority to impose the mandate.”

Are There Other COVID-19 Vaccination and Testing Requirements Employers Need to Be Concerned About?

In short, yes, depending on the state and/or locality. New York City, for instance, recently became the first jurisdiction to mandate vaccination for anyone performing in-person work in the city, and it is unlikely to be the last. Other jurisdictions, such as Chicago, impose requirements on employers relating to employee vaccination, such as mandating employees be provided time off work to get vaccinated and be permitted to use paid time off to recover from the side effects of vaccination. Also on deck for ruling is the federal contractor vaccine mandate (Executive Order 14042), which is currently subject to a nationwide injunction but could be revived by the Eleventh Circuit Court of Appeals, where it is currently pending. Accordingly, now is not the time for employers to take their eye off the ball: Just as the virus has evolved, so too do state and local laws and regulations relating to COVID-19 vaccination and testing.

Can Employers Impose Their Own COVID-19 Vaccination and/or Testing Requirements?

In many cases, yes―but not always. Employers in most jurisdictions in the United States are not prohibited from requiring their employees to be vaccinated against COVID-19 (subject to legally required exemptions) or alternatively subject to mandatory testing. However, some states like Tennessee and Florida, for example, have issued laws or executive orders that outright prohibit employers from requiring their employees to be vaccinated as a condition of employment or impose significant limitations on such mandates. We are likely to see an increase in the number of such laws that limit employers’ ability to require COVID-19 vaccination (and possibly testing) for their employees. Accordingly, employers should consult with counsel prior to implementing COVID-19 vaccination or testing requirements.

CMS Vaccine Mandate Goes Into Effect Nationwide

In its 5-4 decision in Biden v. Missouri, the Supreme Court lifted preliminary injunctions previously issued by district courts in Missouri and Louisiana that had blocked CMS from enforcing its vaccine mandate with respect to eligible staff of covered providers and suppliers that participate in Medicare and Medicaid programs in the states subject to those injunctions. The Supreme Court’s ruling means that CMS’ vaccine mandate (initially issued November 5, 2021) has the green light to proceed across the country.

In upholding CMS’ authority to impose this vaccine mandate, the Supreme Court focused on CMS’ power to condition program participation on such “requirements as [CMS] finds necessary in the interest of the health and safety of individuals who are furnished services in the institution” including maintaining and enforcing an “infection prevention and control program designed… to help prevent the development and transmission of communicable diseases and infections.”

The Court found reasonable CMS’ position that a COVID-19 vaccine will substantially reduce the likelihood that healthcare workers will contract the disease and pass it along to patients and, therefore, the vaccine is “necessary to promote and protect patient health and safety.” The Court found CMS’ exercise of authority with respect to a vaccine mandate to be similar to other CMS-imposed conditions of participation that are justified on the basis of protecting patient health and safety, such as those the programs hospitals must implement to govern the “surveillance, prevention, and control of… infectious diseases,” and qualifications and duties of healthcare professionals.

Although the Court acknowledged that the CMS vaccine mandate goes farther than what CMS has done in the past to address infection control, it recognized that the scale of scope of the infection problem is unprecedented, that vaccination requirements in the healthcare environment are common and that healthcare workers and public health organizations support the mandate. The Court held that CMS is not exceeding its authority in imposing the vaccine mandate on covered Medicare and Medicaid program providers and suppliers as a condition of eligibility for program funds.

The Court also dismissed arguments that the CMS vaccine mandate was arbitrary and capricious because other approaches such as a testing mandate, natural immunity or simply encouraging vaccinations were not adequately analyzed, concluding that the agency “acted within a zone of reasonableness.” The Court did not take issue with the agency’s desire to move on an expedited basis without formal notice and comment, acknowledging the positive health impact of implementing the vaccine mandate in advance of the upcoming winter flu season.

Ultimately, the Court stayed the district courts’ injunctions that were blocking the implementation of the CMS vaccine mandate, clearing the way for its enforcement across the country. Of course, as with the Supreme Court’s decision regarding the ETS, the ruling on the CMS vaccine mandate deals only with the preliminary injunctions and is not a ruling on the merits, which will now be addressed by the lower courts and could ultimately be heard again by the Supreme Court. It is more likely, given the Supreme Court’s reasoning in this initial decision, that the Supreme Court will look favorably upon the CMS vaccine mandate in the event it comes before it again for a ruling on the merits.

What, then, should covered Medicare and Medicaid providers and suppliers be preparing to do?

Overview of Compliance Obligations Under the CMS Vaccine Mandate

CMS issued guidance on December 28, 2021, setting forth time frames in which the facilities of covered Medicare and Medicaid providers and suppliers (covered facilities) must meet their compliance obligations.

Under this guidance, covered facilities in states that had not been subject to an injunction have been and remain subject to CMS’ two-phase compliance timeline:

Phase 1 (by January 27, 2022)

Covered facilities must demonstrate:

  • That they have developed and implemented policies and procedures for ensuring all facility staff, regardless of clinical responsibility or patient or resident contact, are vaccinated for COVID-19; and
  • That 100 percent of staff have received at least one dose of a COVID-19 vaccine; have a pending request for or have been granted a qualifying religious or medical exemption; or identified as having a temporary delay as recommended by the CDC. Failure to do so constitutes noncompliance, although CMS has stated it will not engage in an enforcement action if a facility is 80 percent compliant and has a plan to achieve 100 percent compliance within 60 days.

Phase 2 (by February 28, 2022)

Covered facilities must demonstrate:

  • That they have developed and implemented policies and procedures for ensuring all facility staff, regardless of clinical responsibility or patient or resident contact, are vaccinated for COVID-19; and
  • That 100 percent of staff have received the necessary doses to complete the vaccine series (i.e., one dose of a single-dose vaccine or all doses of a multiple-dose vaccine series) or have been granted a qualifying religious or medical exemption, or identified as having a temporary delay as recommended by the CDC. Failure to do so constitutes noncompliance, although CMS has stated it will not engage in an enforcement action if a facility is 90 percent compliant and has a plan to achieve 100 percent compliance within 30 days.

Facilities that fail to meet either of those parameters could be subject to additional enforcement actions, depending on the severity of the deficiency and the type of facility, such as plans of correction, civil monetary penalties, denial of payment, termination, etc.

Beginning March 28, 2022, covered facilities must be 100 percent compliant or be subject to enforcement actions.

CMS also recently issued guidance specific to 14 provider types, setting forth that in addition to policies and procedures related to completion of the vaccination process itself, covered facilities must develop the following policies and procedures by January 27, 2022:

  • A process to ensure the implementation of additional precautions, intended to mitigate the transmission and spread of COVID-19, for all covered staff who are not fully vaccinated for COVID-19;
  • A process for tracking and securely documenting staff vaccination status, including any booster doses;
  • A process for staff to request an exemption and a process to track and document accommodations provided to those granted an exemption. Documentation of medical exemptions must specify which COVID-19 vaccines are clinically contraindicated and the “recognized” clinical reasons for the contraindication, be signed and dated by a licensed practitioner who is acting within their scope of practice and is not the person seeking the exemption, and include a statement by the practitioner recommending that the staff member be exempted from the facility’s COVID-19 vaccination requirement; and
  • Contingency plans for staff who are not fully vaccinated for COVID-19.

On January 14, 2022, CMS issued additional guidance with updated compliance deadlines for the covered facilities in the states that previously had been subject to injunctions, and that now, under the Supreme Court’s decision, are obligated to comply with the CMS vaccine mandate. Covered facilities in 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, Utah, West Virginia and Wyoming have until February 13, 2022, to complete Phase 1 and until March 15, 2022, to complete Phase 2. The CMS vaccine mandate remains preliminarily enjoined in facilities located in Texas and CMS will not investigate compliance.

In assessing whether it has met its obligation to fully vaccinate 100 percent of its eligible staff, a covered facility must keep in mind the sweeping nature of the definition of staff covered by the CMS vaccine mandate. Regardless of clinical responsibility or patient contact, the vaccine mandate applies to all staff who directly provide any care, treatment or other services for the facility and/or its patients, including employees, licensed practitioners, students, trainees, volunteers and individuals who provide care, treatment or services for a covered facility or its patients through contract or otherwise. This means that the vaccine mandate covers, for example, members of a hospital or facility medical staff even if they would not otherwise be covered pursuant to their individual physician offices, administrative staff, facility leadership, fiduciary board members, housekeeping and food services.

However, not all individuals are covered. The vaccine mandate does not cover, for example, staff who exclusively provide telehealth or telemedicine services outside of the facility setting and who do not have any direct contact with patients and other staff, and staff who are fully remote, providing support services for the hospital that are performed exclusively outside of the hospital setting and who do not have any direct contact with patients and other staff.

Covered facilities need to take a critical look at their workforce now, if they have not done so already, to determine what staff are covered by the mandate and take affirmative steps to ensure that eligible staff are fully vaccinated in accordance with the CMS deadlines.

Interplay of CMS Mandate with Other Federal/State Laws

In general, if a Medicare- or Medicaid-certified provider or supplier falls under the requirements of the CMS vaccine mandate, it should look at those requirements first. In other words, the CMS vaccine mandate takes precedence over other federal vaccine mandates, such as Executive Order 14042 mandating vaccines for federal contractors, also currently subject to a nationwide injunction. The CMS vaccine mandate also preempts state law and state-issued executive orders that either forbid or impose less restrictive requirements. Notably, in those states with laws or orders conflicting with the CMS vaccine mandate, such as Florida, we anticipate litigation will ensue on the issue of whether the CMS vaccine mandate preempts such laws. If a healthcare facility determines that it is not covered by the CMS mandate, and is not making preliminary plans for compliance with Executive Order 14042, it must still comply with the remaining recordkeeping provisions of OSHA’s Healthcare ETS that were not withdrawn, as well as any state or local vaccine or testing requirements. Of course, healthcare entities may also independently mandate COVID-19 vaccines and tests, subject to any state law restrictions.

The bottom line? Covered facilities must act quickly to (1) determine whether the CMS vaccine mandate applies to their facilities and workforce; (2) review and modify existing infection prevention and control policies and procedures to ensure compliance with the new vaccination and documentation requirements; and (3) process exemption requests and ensure staff vaccinations are consistent with the January, February and March deadlines.