Virginia Health-Care Lawsuit Can Proceed, Judge Says
Virginia Governor Bob McDonnel
Geoff Burke/Getty Images
Virginia Governor Bob McDonnell.
Virginia Governor Bob McDonnell. Photographer: Geoff Burke/Getty Images
Virginia can proceed with its lawsuit challenging the health-care overhaul signed by President Barack Obama in March, a federal judge said.
U.S. District Judge Henry E. Hudson in Richmond, Virginia, today denied a U.S. Justice Department request to throw out the suit, rejecting arguments that the state had no right to sue. Virginia said the U.S. Congress had unconstitutionally exceeded its powers by requiring individuals to buy insurance.
“While this case raises a host of complex constitutional issues, all seem to distill to the single question of whether or not Congress has the power to regulate -- and tax -- a citizen’s decision not to participate in interstate commerce,” Hudson wrote in his 32-page ruling.
There is “some authority arguably supporting the theory underlying each side’s position,” Hudson said. The U.S. Supreme Court and other federal appeals courts haven’t squarely addressed the issue, he said.
“The decision is a procedural step that just means there will be a full hearing on the arguments,” U.S. Health and Human Services Secretary Kathleen Sebelius told reporters in a conference call after Hudson handed down his ruling. “We remain confident that the case is solid and that there’s a full constitutional case for the passage of the Affordable Care Act.”
Virginia filed its suit within minutes of Obama signing the bill on March 23. The following day, Governor Bob McDonnell signed legislation making it illegal to force the state’s residents to buy health insurance.
Florida Lawsuit
Florida, joined by 19 other states, filed a separate lawsuit claiming that the health-reform law is unconstitutional and puts a fiscal burden on its cash-strapped budget by expanding state-run Medicaid programs. U.S. District Judge Roger Vinson in Pensacola, Florida, scheduled a non-jury trial in that case for Sept. 14.
Virginia claims in its lawsuit that the federal mandate to buy health insurance goes beyond Congress’s authority. The U.S. said the provision is allowed under its power to regulate commerce because of the $43 billion in unpaid medical bills absorbed by the market each year.
The U.S. said Virginia doesn’t have standing to sue, and that no one has suffered any injury because the insurance requirement doesn’t take effect until 2014. The state said the conflict was inevitable and therefore ripe for litigation now.
Virginia Law
Virginia filed the case in March, defending the Virginia Healthcare Freedom Act, the state law barring the compulsory purchase of health insurance by its citizens.
“This case is not about health care, so much as it is about liberty,” Virginia Attorney General Kenneth Cuccinelli told reporters at a press conference today.
Cuccinelli said the federal health-care statute has no severability clause. That means the entire act will be invalidated if Virginia’s challenge is upheld, he said.
“If this law is ultimately upheld, it will be the new outer limit” of federal constitutional power, he said. Hudson is scheduled to hear argument on the merits of the state’s case on Oct. 18.
McDonnell, the state’s Republican governor, said in a statement that he looked forward to the hearing.
“The requirement that all Americans must purchase health insurance or face a penalty is not permitted under the Commerce Clause of the United States Constitution,” McDonnell said.
Health Club
In a July 1 hearing, Hudson expressed skepticism over the federal legislation’s reach, wondering whether the government could force citizens to join a health club.
Lawyers for the U.S. said Congress has a right to regulate people who hurt the economy when they become sick or injured and seek health care without insurance. Because the federal government covers some costs of the uninsured, it has authority to require them to get health coverage even if they don’t want it, the lawyers said.
Virginia said the law’s purpose is to ensure that people buy health-care coverage and not to raise revenue. That means it shouldn’t be classified as a tax, and that puts it outside the realm of Congress’ recognized power to tax and spend, the state’s lawyers argue.
The U.S. said the law is within Congress’s authority to tax and to regulate interstate commerce. The possibility of people being unable to pay medical bills is sufficient to draw a link to their insurance coverage and those powers, the federal government said.
‘Wasting’ Money
Larry McNeely of the advocacy group U.S. PIRG, the federation of state Public Interest Research Groups, said in a statement that today’s ruling allows Cuccinelli to “continue wasting” taxpayers’ money.
“Instead of pursuing lawsuits and repeal attempts that accomplish little more than exciting their political base, elected officials in Virginia and other states around the country should focus on using the new health-care law to bring down costs for their constituents,” McNeely said.
The case is Commonwealth of Virginia v. Sebelius, 10-cv-00188, U.S. District Court, Eastern District of Virginia (Richmond).
To contact the reporters on this story: Andrew M. Harris in Chicago at aharris16@bloomberg.net; William McQuillen in Washington at bmcquillen@bloomberg.net.
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