Judge Okays Suit to Block Healthcare Reform


A federal judge in Florida gave opponents of healthcare reform a win ruling that a lawsuit brought by 20 states challenging the constitutionality of the federal healthcare reform could proceed to trial.

Judge Roger Vinson of the U.S. District Court in the Northern District of Florida ruled that the states "had a plausible claim" when they challenged the "individual mandate" outlined in the in Affordable Care Act.

"In this order, I have not attempted to determine whether the line between Constitutional and extraconstitutional government has been crossed," Vinson wrote. "That will be decided on the basis of the parties' expected motions for summary judgment, when I will have the benefit of additional argument and all evidence in the record that may bear on the outstanding issues."

The judge ruled that the plaintiffs' claim that the individual mandate exceeded Congress' authority under the so-called Commerce Clause was plausible, but he threw out the claim that the mandate was unconstitutional because it violated due process.

Explaining his decision on the Commerce Clause, which gives Congress the right to regulate interstate commerce, Vinson wrote, "At this stage in the litigation, this is not even a close call," the judge wrote. By imposing a penalty on citizens for not participating in a particular economic activity, rather than dealing with how they do participate, "the power that the individual mandate seeks to harness is simply without prior precedent."

The 20 states, along with two private citizens and the National Federation of Independent Business, filed the suit on March 23, the day the Affordable Care Act (ACA) was signed into law by President Obama. The suit alleges that the "individual mandate" in the law, which requires all citizens to get health insurance or pay a penalty, exceeds Congress' authority under the Commerce Clause and violates the 5th, 9th, and 10th amendments of the Constitution.

The suit also alleges that the ACA "coerces and commandeers the states with respect to Medicaid" by requiring them to expand the program's eligibility, and that its requirement that employers offer insurance "interferes with the states' sovereignty as large employers and in the performance of government functions."

In its response, the Obama administration said that the plaintiffs were not qualified to sue and that there was not a violation "for which relief can be granted" since the relevant provisions of the law had not yet taken effect.

The administration also argued that another federal law, the Anti-Injunction Act, precludes suing over both the individual and the employer mandate and the penalties associated with them. The Anti-Injunction Act states that the government cannot be sued for collecting a tax before the tax is collected, but instead should be sued for a refund after the tax payment has been received.

On this point, the judge sided with the plaintiffs. "The individual mandate penalty is not a 'tax,'" he wrote. "It is (as the Act itself says) a penalty. ... Therefore, the Anti-Injunction Act does not deprive this court of jurisdiction." The judge also agreed that the plaintiffs were qualified to sue due to the monetary penalties that might be assessed on them as a result of the ACA.

However, Vinson did dismiss several counts, including the charge that the law interferes with employer and state sovereignty.

"Because the Act's employer mandate regulates the states as participants in the national labor market the same as it does private employers, and because the Supreme Court has held in this context that [requiring a minimum level of employment-based benefits] does not interfere with state sovereignty and impede state functions, the employer mandate does not violate the Constitution," wrote Vinson. "Therefore, [this allegation] does not state a plausible claim upon which relief can be granted and must be dismissed."

As for the allegation that the individual mandate was unconstitutional, the judge dismissed the plaintiffs' claims that it was unconstitutional because it violated their right to "due process" of law, since they should have the freedom to "eschew entering into a contract." Judge Vinson noted that in passing the ACA, "Congress ... concluded that the individual mandate was 'essential' to the insurance market reforms contained in the statute," thus giving the mandate a "rational basis" that could withstand a "due process" challenge since it didn't violate a "fundamental right" of citizens.

Judge Vinson's ruling contrasts with one by another federal district court judge, George Caram Steeh of Detroit, who ruled on Oct. 7 that plaintiffs in a similar case in Michigan would not be granted a preliminary injunction against the ACA.

"The decision whether to purchase insurance or to attempt to pay for healthcare out of pocket, is plainly economic," he wrote. "These decisions, viewed in the aggregate, have clear and direct impacts on healthcare providers, taxpayers, and the insured population who ultimately pay for the care provided to those who go without insurance. These are the economic effects addressed by Congress in enacting the Act and the minimum coverage provision."

Judge Vinson also upheld the allegation regarding the Medicaid expansion. He noted that the point at which states would be considered to be unduly coerced into following a particular federal law has never been clearly decided by the courts and therefore "the plaintiffs have stated a 'plausible' claim" in this case.

At the beginning of his ruling, the judge noted that he was not there to appraise the law's merits or flaws. "My review of the statute is not to question or second guess the wisdom, motives, or methods of Congress," he wrote. "I am only charged with deciding if the Act is constitutional. If it is, the legislation must be upheld -- even if it is a bad law."

Conversely, "if it is unconstitutional, the legislation must be struck down -- even if it is a good law," he added.

The case is scheduled to go to trial on Dec. 16. Several other similar cases against the ACA also are still pending.