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. 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.


  2. 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.


  3. 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.


  4. 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.


  5. 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.


  6. 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.


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

  8. 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.

  9. 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 …

  10. 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.”


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

  11. 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:

  12. 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.

  13. 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?

  14. 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.

  15. “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!

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