Federal Court Rules Challenge To Federal Health Care Law Can Go Forward

In Florida, U.S. District Judge Roger Vinson has rejected an effort by the Obama Administration to dismiss a challenge of the health care law and has ordered the case to proceed — even criticizing the position of the Administration as “Alice in Wonderland” arguments.

While dismissing a couple claims, Vinson allowed two of the major counts to go forward: the states’ challenge to the controversial requirement that nearly all Americans buy insurance and a required expansion of the Medicaid program. The former is the issue that was the subject of a prior column where I expressed concern over the constitutionality of the law. I also previously told congressional members and staff that I believed that this approach was unnecessary to achieve these results and would raise serious constitutional questions.

Vinson noted that the Democrats claimed at different times that the mandate was a penalty and a tax. He ruled that it is in fact a penalty. In stinging language, Vinson noted “Congress should not be permitted to secure and cast politically difficult votes on controversial legislation by deliberately calling something one thing, after which the defenders of that legislation take an “Alice-in-Wonderland” tack and argue in court that Congress really meant something else entirely, thereby circumventing the safeguard that exists to keep their broad power in check.”

We previously discussed the shifting between the insistence that this is a tax versus a penalty in public statements — a failure of the Administration to adopt a consistent public position despite its obvious importance to the anticipated litigation. This lawsuit was filed minutes after President Obama signed the bill. This is a rather embarrassing failure of the Justice Department and White House counsel to educate Democratic leaders, including President Obama, on the need to adopt a consistent position of the mandate as a tax.

Vinson acknowledged that a district judge in Michigan upheld the power of Congress in another challenge, but ruled that the issue is not settled and that these powers claimed by Congress “have never been applied in such a manner before.”

The Florida lawsuit was filed on behalf of 20 states.

Source: Post

Jonathan Turley

43 thoughts on “Federal Court Rules Challenge To Federal Health Care Law Can Go Forward

  1. As Rodney Kings said….Can’t we just get along…..American is being victimized by political agendas….does Wilson’s League of Nations ring any bells….ok…SFO…maybe not a good place…but still….

  2. Health Care Lawsuit to Go Forward in Florida
    By: David Dayen Thursday October 14, 2010 1:48 pm

    A handpicked district court judge in Florida rejected a motion to dismiss a lawsuit against the Affordable Care Act, allowing challenges to the constitutionality of the law on two counts to go forward. Attorney General Bill McCollum, forum-shopping to the most conservative city in Florida, Pensacola, for the best opportunity to get a sympathetic judge, filed the suit on behalf of 20 states.

    http://news.firedoglake.com/2010/10/14/health-care-lawsuit-to-go-forward-in-florida/

  3. “If I had a world of my own, everything would be nonsense. Nothing would be what it is, because everything would be what it isn’t. And contrary wise, what is, it wouldn’t be. And what it wouldn’t be, it would. You see?” – The Mad Hatter

    Well at least we’ve solved the riddle of the Hatter’s employment status since leaving Alice’s company.

    He works in Washington.

  4. Twenty Attorneys General should be able to get the courts attention, but I would hope that the White House has not created a bill that can be taken apart by these types of political inquiries. We will see…The the states win, there is probably a billion dollars waiting to run ads show how the Obama White House is inept.

  5. It looks like it will be 1-1 when the forum-shopped Judge Vinson makes his decision in December.

    Gosh, this is as bad as when they made Texans buy automobile insurance. Socialism!

    They refused which eventually led to more and more trailer parks as lawsuits led to bankruptcy, etc…
    ;-)

  6. “In Florida, U.S. District Judge Roger Vinson has rejected an effort by the Obama Administration to dismiss a challenge of the health care law and has ordered the case to proceed — even criticizing the position of the Administration as “Alice in Wonderland” arguments.”
    ————————————————————-
    This is Wonderland all right, wake me when it’s safe to come topside….more from the land of blunder….er, wonders;

    http://www.palmbeachpost.com/money/three-of-5-nurses-in-florida-are-leaving-732785.html?imw=Y

    as an RN in Florida I can attest that what is going on here is neither healthy or caring. It’s all about the money and securing ‘market position’….which is a big fat joke since there is no market anymore…..

  7. Dredd: “Gosh, this is as bad as when they made Texans buy automobile insurance. Socialism!” there is no mandate for every Texan to purchase auto insurance, nice try.

    It is good to see that someone is willing to tell the majority Democrats that they do not hold supreme power over the lives of Americans. If they want to expand mediciad, then try to expand medicaid and we can have that debate. But do not try to pass legislation that flies in the face of the constitution and expect Americans to accept it without a fight.

  8. “But do not try to pass legislation that flies in the face of the constitution and expect Americans to accept it without a fight.”
    —————————————————————
    I don’t think this is an American ‘fight’. I think this looks like special interests obstructing attempts to protect Americans. Please correct me if I’m wrong (and I will humbly acquiesce…)but the ‘forcing’ people to buy was something that got added on because private industry was trying to prevent anything but total privatisation of insurance to begin with. This was not part of the initial single payer proposal which got gutted left right and center by private for profits who have proven undoubtably that they couldn’t care less about the ‘health’ in healthcare. If you want to fight for Americans why not stop beating them up and allowing others to do so?

  9. I agree with Turley, the mandate is unconstitutional and should be rescinded. Then the Health Care bill might mean something; as it stands now I think the mandate hands the industry *more* profit than they give up by ending their most horrific practices.

  10. Tony C. 1, October 15, 2010 at 1:35 pm

    I agree with Turley, the mandate is unconstitutional and should be rescinded. Then the Health Care bill might mean something; as it stands now I think the mandate hands the industry *more* profit than they give up by ending their most horrific practices.

    ——————————–

    I think you may fundamentally misunderstand how this bill works. Without the mandate, the rest of it falls apart.

    The Federal bill is generally similar to MA’s MittRomneyCare – essentially everyone in the state needs to buy into the health insurance system, and this, in turn, funds coverage for low income people. Under MittRomneyCare, if you don’t have qualifying health insurance, then you don’t get to claim an exemption on your income tax. In other words, you get fined.

    It’s too bad that the folks in Congress and the Senate didn’t have the spine to set this requirement up properly. If millions of Americans get screwed because implementation of the bill is delayed, the results will be tragic.

  11. “Senate didn’t have the spine ”
    Look at its Democratic leader.I’m quite sure his picture is next to the word spineless.

  12. mcoville,

    Texas law:

    “There are severe penalties for violating the state’s financial responsibility law. A first conviction will result in a fine between $175 and $350. Subsequent convictions could result in fines of $350 to $1,000, suspension of your driver’s license, and impoundment of your automobile.”

    http://www.tdi.state.tx.us/pubs/consumer/cb088.pdf

    Those who rebel against this law end up in trailer parks … or worse.

    Where do you live?

  13. The state’s largest insurer has been approved to raise health premium rates by 41 percent to 47 percent for some of its policies sold to individual buyers, in the largest price hikes yet seen in Connecticut since the adoption of national health care reform.

    For all of its individual market plans, Anthem Blue Cross and Blue Shield has received approval to raise rates by at least 19 percent — including a range of 30 percent to 44 percent for the brand of plans in the individual market that was most popular in 2009, Century Preferred.

    The reason for the increases is the new federal health reform mandates, according to Anthem and the state Department of Insurance, which is defending its approval against charges by Attorney General Richard Blumenthal. Those reforms took effect Sept. 23.

    http://www.washingtonexaminer.com/opinion/blogs/beltway-confidential/obamacare-mandates-result-in-47-percent-hikes-in-insurance-costs-in-connecticut-105036299.html

  14. “There are severe penalties for violating the state’s financial responsibility law. A first conviction will result in a fine between $175 and $350. Subsequent convictions could result in fines of $350 to $1,000, suspension of your driver’s license, and impoundment of your automobile.”

    Same in Florida.

  15. Bdaman

    Thanks for helping to make those point in support universal health care. Obviously the health insurance industry is still the bully on the block. They still think Bush is in office and they can rape the public with impunity.

    BTW, Arizona residents are REQUIRED

  16. Arizona residents are REQUIRED to carry car insurance, but that’s not the point nor the unchallengable legal basis for the methodology of the HCR Act. The federal government most certainly well within its rights to levy a tax. They’ve levied a tax for which there is a 100% deduction by carrying health insurance. End of story.

  17. “Where do you live?”
    ————————-

    I’m probably headed for the trailer park at this rate….but I hear the people there are of the very nicest sort!

  18. I may just be bullheaded, but I still believe that there is nothing unconstitutional about this legislation. Nor am I particularly disturbed by Judge Vinson’s order. Getting past a motion to dismiss means nothing more than that a group of lawyers put their heads together and figured out how to plead a cause of action. Permitting the matter to go to trial on the surviving issues will create a clear record for appellate purposes, which is important since the decision will be appealed regardless of who prevails. I guess we’ll have a result soon enough.

  19. The mandate only works if the insurance is purchased from a not for profit entity. In other words like SS, and Medicare. Which is what the Dims wanted in the first place and gave away to the Republicans who were going to vote against the bill anyway.

    Op in to a Civil Service type government plan would have been simpler and quicker and less legally assailable.

    Isn’t Obama supposed to be a Constitutional lawyer?

  20. Isn’t the American court system amazing? For all the injustices it can seem to correct, for some reason it always has to screw up right when people start trusting it. First you win our hearts by allowing the government to challenge Arizona’s insane immigration law: http://lawblog.legalmatch.com/2010/10/15/the-arizona-immigration-madness-continues/ And then you have to go and break our hearts by letting public health care be challenged. To be fair, the incompetent judge and lawyers are to be blamed for this, too.

  21. Dredd 1, October 16, 2010 at 9:07 am

    Woosty’s Still A Cat,

    “… I hear the people there are of the very nicest sort!”

    Like any place, there are the good, the bad, and the ugly.
    ——————————————————-
    That is a cool link Dredd! I love illustrative cosmology :)

    I was only being 1/2 serious….not all ‘trailer parks’ are created equal and actually it’s the people in them that make the difference. And my ‘bucket’ list actually includes traveling the USA (preferably for a year or more) in a mobile type environ…here’s my 1st choice:
    http://www.vonslatt.com/ :)

  22. Woosty’s Still a Cat,

    I wish I could too.

    But my trailer is attached to the ground ;-) so I can’t …

    Back to the health care case …

    I found and interesting quote that mcoville might find interesting too:

    After all, most people spend their lives making decisions under uncertainty, and that’s what dealing effectively with climate change demands – the same kind of decisions you make when you decide to buckle your seatbelt, or buy insurance for your house or invest in the financial markets.”

    http://www.bbc.co.uk/news/science-environment-11551943

    Insurance For Health, Cars, and the Environment have a similar thread: Precaution is good for the goose and for the gander.

  23. 10-15-2010

    Chris Snowbeck

    The last insurance company writing “child-only” health policies in Minnesota has pulled out of the market.

    Minnetonka-based Medica said Friday that it is no longer selling policies that cover individuals under the age of 19…

    —–

    Last month, three other insurance companies in Minnesota said they were dropping out of the child-only market because of changes prompted by the federal health care overhaul that Congress passed earlier this year.

    Read this story at twincities.com …

  24. W=c,

    I’m a sleep in this AM, and as I drink that late first coffee, I’d like to say thanks for the mellow start to my day that clip provided.

  25. The companies raise the deductibles every year. Now they can blame Obama even though they were hiking employee contributions like they have for years.

  26. During the White House Summit on health care, Senator Lamar Alexander (R-Tenn.), chairman of the Senate Republican Conference, and President Obama argued as to whether the Democratic health care bill would cause premiums to rise.

    Obama said premiums would decrease by 14% and attacked Sen. Alexander saying:
    “This is an example of where we’ve got to get our facts straight.”

    Fast Forward

    In 2011 employees’ share of premiums for a family plan is up an average of 14%, to $3,997.
    CNN reported:

    It’s that time of year when employers deliver bad news about next year’s benefits.

    Chances are you’ll learn that your 2011 health insurance tab will be sharply higher, as companies continue to shift the burden of rising costs onto their workers.

    Employees’ share of premiums for a family plan is up an average 14%, to $3,997, vs. just a 3% rise in the total bill, according to the Kaiser Family Foundation.

    And it’s not just premiums that are spiraling higher. You’re also likely to be hit with higher deductibles and out-of-pocket maximums as well as bigger bills for doctor’s visits and drugs.

    “Increasingly, employees have to be thoughtful about not just the cost of the plan, but the cost of the services they use,” says Michael Thompson, a principal with Pricewaterhouse-Coopers’ human resources practice.
    1 million to lose out on better coverage

    It seems people are doing that, but not in the way experts recommend: Recent data suggest that many insured Americans are now forgoing care because of the cost.

    http://money.cnn.com/2010/10/20/pf/rising_health_care_costs.moneymag/

  27. Obamacare is destroying Medicare- Email going out to AMA members In order to get the AMA’s support for Obamacare, (Obama) promised physicians he would not cut Medicare reimbursements to doctors by the planned 20%. Obama is keeping his word. He is not cutting Medicare reimbursements to doctors by 20% ….He is cutting them 30%

    On June 24, 2010, Congress passed a six-month Medicare patch providing a 2.2 percent positive update and a temporary reprieve for seniors and the physicians who care for them. In December, without action by Congress, the Medicare physician payment cut will be a whopping 23 percent, increasing to nearly 30 percent in January 2011.

    With baby boomers beginning to enter into Medicare in just six months, the physician payment problem must be addressed or these new Medicare patients won’t be able to find a doctor to treat them. Congress must act to replace the broken physician payment system before the cost to fix it grows even larger. Call your members of Congress at (800) 833-6354 and demand they fix the problem once and for all.

    http://www.ama-assn.org/ama/pub/physician-resources/solutions-managing-your-practice/coding-billing-insurance/medicare/payment-action-kit-medicare.shtml

  28. New Rules Coming for Payments Out of Health Savings Accounts

    Under the new health care law, consumers using workplace pre-tax health savings accounts will soon need a doctor’s note to pay for Tylenol and an estimated 15,000 other over-the-counter drugs.

    Starting Jan. 1, employees who use flexible spending accounts (FSAs), health saving accounts (HSAs), or health reimbursement arrangements (HRAs) to pay for common medications such as pain relievers, cold medicines, antacids and allergy medications will need prescriptions. The new rules don’t apply to insulin.

    http://www.foxnews.com/politics/2010/10/15/new-health-care-rules-require-doctors-note-pay-otc-drugs-fsas/

  29. ObamaCare, for Some
    Step right up and get your waiver.

    Well, well. In the clearest evidence so far that ObamaCare is harmful in practice and an election-year liability, the Obama Administration has decided not to enforce some of the law’s “consumer protections.” At least when the results are politically embarrassing.

    Over the last several weeks the Health and Human Services Department has granted dozens of temporary waivers to certain ObamaCare mandates so that insurers and businesses won’t drop or cancel coverage. The most conspicuous went to McDonald’s to protect the “mini-med” plans for some 30,000 hourly workers from a rule that prohibits annual restrictions on benefits. Mini-med policies offer modest coverage at low premiums and other low-wage fast-food chains like Jack in the Box and Denny’s have been granted waivers as well.

    Cigna, Aetna and a few other insurers have been given hall passes to continue selling mini-meds. Another went to the United Federation of Teachers Welfare Fund. The New York union offers city teachers supplemental drug coverage that would have been banned under the new rules.

    At least this sudden regulatory flexibility is protecting the coverage that people have today, as President Obama promised. But it isn’t much of an improvement if HHS retreats only after a national political blow-up. After all, the essential point of the regulations was to destroy mini-med plans and other types of coverage that Democrats claim are insufficiently generous. Democrats from Mr. Obama on down call these rules “the patients’ bill of rights,” but people don’t regularly need exemptions from a bill of rights.

    http://online.wsj.com/article/SB10001424052748703794104575546052343243306.html?mod=googlenews_wsj

  30. Exclusive: New Study Says Cost of Health Reform Subsidies Could Far Exceed Previous Estimates

    Morgen on October 20, 2010 at 6:59 pm

    A new study by the Lewin Group estimates that 28.6 million Americans will be eligible for a federal subsidy to purchase health insurance beginning in 2014 at a projected cost to tax payers in excess of $110 billion. This estimate is dramatically higher (578%) than the cost of these subsidies forecast by the Congressional Budget Office (CBO) prior to the bill’s enactment into law. If the new estimate is correct, it would mean that instead of lowering the deficit by $143 billion over ten years—a claim widely touted by proponents of the law— the legislation would begin adding to the deficit as early as 2015, only one year after major provisions of the law go into effect.

    http://www.verumserum.com/?p=18038

  31. ObamaCare’s Incentive to Drop Insurance

    My state of Tennessee could reduce costs by over $146 million using the legislated mechanics of health reform to transfer coverage to the federal government.

    One of the principles of game theory is that you should view the game through your opponent’s eyes, not just your own.

    This past spring, the Patient Protection and Affordable Care Act (President Obama’s health reform) created a system of extensive federal subsidies for the purchase of health insurance through new organizations called “exchanges.” The details of these subsidies were painstakingly worked out by members of my own political party to reflect their values: They decided who was to benefit from the subsidies and what was to be purchased with them. They paid a lot of attention to their own strategies, but what I believe they failed to consider properly were the possible strategies of others.

    Our federal deficit is already at unsustainable levels, and most Americans understand that we can ill afford another entitlement program that adds substantially to it. But our recent health reform has created a situation where there are strong economic incentives for employers to drop health coverage altogether. The consequence will be to drive many more people than projected—and with them, much greater cost—into the reform’s federally subsidized system. This will happen because the subsidies that become available to people purchasing insurance through exchanges are extraordinarily attractive.

    http://online.wsj.com/article/SB10001424052702304510704575562643804015252.html?mod=WSJ_newsreel_opinion

  32. Congressional Budget Office director Doug Elmendorf said Friday that ObamaCare includes work disincentives likely to shrink the amount of labor used in the economy.

    In a speech on ObamaCare’s economic impact outside the health care sector, Elmendorf said that those effects will primarily be related to the labor market and “will probably be small.”

    Factoring in additional demand for workers in health care and insurance, CBO estimates that “the legislation, on net, will reduce the amount of labor used in the economy by roughly half a percent,” he said.

    The reason: The expansion of Medicaid and new health insurance subsidies will reduce “the amount of labor that workers choose to supply.”

    (For perspective, half a percent of current payrolls is 651,000 jobs, though the impact would show up in both fewer jobs and fewer hours worked.)

    The conclusion isn’t a surprising one; any extra support from the government takes some pressure off of workers to provide for themselves. However, ObamaCare’s progressive subsidies, i.e. more generous for those who earn less, carry more of a disincentive than the flat, universal benefit favored by some Republicans.

    As Capital Hill has noted previously, work disincentives will be particularly strong for older workers because both health care premiums and the law’s subsidies grow much bigger with age.

    Further, the new health law will give some older households without access to employer care a big incentive not to earn too much. That’s because earning more than 400% of the poverty level would make them ineligible for subsidies that may be well in excess of $10,000 for couples.

    Consider this example of a single individual age 62 in a high-cost area and no access to employer care. According to the Kaiser Family Foundation’s Health Reform Subsidy Calculator:

    * At 200% of the poverty level, or $23,000 in income in 2014, an individual would get $10,750 in premium subsidies.

    * At 400% of the poverty level, or $46,000, an individual would get $7,830 in premium subsidies.

    * And at 401% of the poverty level, an individual would get no government support.

    http://blogs.investors.com/capitalhill/index.php/home/35-politicsinvesting/2154-cbo-confirms-obamacare-discourages-work

  33. 5 freedoms you’d lose in health care reform
    If you read the fine print in the Congressional plans, you’ll find that a lot of cherished aspects of the current system would disappear.

    NEW YORK (Fortune) — In promoting his health-care agenda, President Obama has repeatedly reassured Americans that they can keep their existing health plans — and that the benefits and access they prize will be enhanced through reform.

    A close reading of the two main bills, one backed by Democrats in the House and the other issued by Sen. Edward Kennedy’s Health committee, contradict the President’s assurances. To be sure, it isn’t easy to comb through their 2,000 pages of tortured legal language. But page by page, the bills reveal a web of restrictions, fines, and mandates that would radically change your health-care coverage.

    If you prize choosing your own cardiologist or urologist under your company’s Preferred Provider Organization plan (PPO), if your employer rewards your non-smoking, healthy lifestyle with reduced premiums, if you love the bargain Health Savings Account (HSA) that insures you just for the essentials, or if you simply take comfort in the freedom to spend your own money for a policy that covers the newest drugs and diagnostic tests — you may be shocked to learn that you could lose all of those good things under the rules proposed in the two bills that herald a health-care revolution.

    In short, the Obama platform would mandate extremely full, expensive, and highly subsidized coverage — including a lot of benefits people would never pay for with their own money — but deliver it through a highly restrictive, HMO-style plan that will determine what care and tests you can and can’t have. It’s a revolution, all right, but in the wrong direction.

    Let’s explore the five freedoms that Americans would lose under Obamacare:

    http://money.cnn.com/2009/07/24/news/economy/health_care_reform_obama.fortune/index.htm?postversion=2009072410

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