Health Care Reform Faces Long Legal Fight
Experts predict appeal to the Supreme Court; key sticking point is provision that Americans must carry insurance
by Karen Pallarito
November 14, 2010
Source: Bloomberg/Business Week/HealthDay:
(HealthDay News) -- A federal judge's ruling Monday that struck down a key component of the new U.S. health-care reform law -- that nearly all Americans carry health insurance -- marks the first successful challenge to the controversial legislation.
But the battle over the law, which has pitted President Barack Obama and fellow Democrats against Republicans, will continue to be fought in the federal court system until it finally reaches the U.S. Supreme Court, perhaps as early as next year, experts predict.
Tuesday afternoon, the U.S. Justice Department said it planned to appeal the decision to an appellate court, Fox News reported.
During an interview with a Tampa, Fla., TV station on Monday, Obama said: "Keep in mind this is one ruling by one federal district court. We've already had two federal district courts that have ruled that this is definitely constitutional."
"You've got one judge who disagreed. That's the nature of these things," he said.
Earlier Monday, a federal judge sitting in Richmond, Va., ruled that the health-care legislation, signed into law by Obama in March, was unconstitutional, saying the federal government has no authority to require citizens to buy health insurance.
The ruling was made by U.S. District Judge Henry E. Hudson, a Republican appointed by President George W. Bush who had seemed sympathetic to the state of Virginia's case when oral arguments were heard in October, the Associated Press reported.
But as the Washington Post noted, Hudson did not take two additional steps that Virginia had requested. First, he ruled that the unconstitutionality of the insurance-requirement mandate did not affect the rest of the law. And he did not grant an injunction that would have blocked the federal government's efforts to implement the law.
White House officials had said last week that a negative ruling would not affect the law's implementation because its major provisions don't take effect until 2014.
Just two weeks ago, a federal judge in nearby Lynchburg, Va., upheld the constitutionality of the health insurance requirement, The New York Times reported. "Far from 'inactivity,'" said Judge Norman K. Moon, who was appointed by President Bill Clinton, "by choosing to forgo insurance, plaintiffs are making an economic decision to try to pay for health care services later, out of pocket, rather than now, through the purchase of insurance." A second federal judge appointed by Clinton, a Democrat, has upheld the law as well, the Times said.
In the case decided Monday, Virginia Attorney General Kenneth Cuccinelli, a Republican, had filed a lawsuit in defense of a new Virginia law barring the federal government from requiring state residents to buy health insurance. He argued that it was unconstitutional for the federal law to force citizens to buy health insurance and to assess a fine if they didn't.
The U.S. Justice Department said the insurance mandate falls within the scope of the federal government's authority under the Commerce Clause. But Cuccinelli said deciding not to buy insurance was an economic matter outside the government's domain.
In his decision, Hudson agreed. "An individual's personal decision to purchase -- or decline to purchase -- health insurance from a private provider is beyond the historical reach of the Commerce Clause," the judge said.
Jack M. Balkin, a professor of constitutional law at Yale University who supports the constitutionality of the health-reform package, told the Times that "there are judges of different ideological views throughout the federal judiciary."
Hudson seemed to reflect that reality when he wrote in his opinion that "the final word will undoubtedly reside with a higher court," the Times reported.
Hudson's decision was not unexpected, and both supporters and opponents of the legislation anticipate that its fate will be decided by the Supreme Court.
Hudson became the first federal judge to strike down a key part of the health law, which had been upheld by federal judges in Virginia and Michigan. Several other lawsuits have been dismissed and others are pending, including one filed in Florida by 20 states, according to the AP.
By 2019, the law, unless changed, will expand health insurance access to 94 percent of non-elderly Americans.
Advocates say that between now and then, the law will also provide consumers with many new rights and protections.
Key provisions include:
- Health insurance plans may no longer deny coverage to adults based on pre-existing health conditions. This provision is scheduled to take effect in 2014.
- Health plans that cover dependents must permit children to stay on a parent's family policy until age 26. This provision took effect in September.
- Insurers may no longer place lifetime dollar limits on essential benefits. This provision took effect in September.
- New health plans must offer preventive services such as mammograms and colon cancer screenings without charging a deductible, co-payment or coinsurance. This provision took effect in September, but does not apply to existing plans that are "grandfathered."
Reaction to the judge's ruling Monday was divided, with opponents of the law pleased while backers were dismayed.
The mandate that consumers buy insurance or pay a penalty marked the first time Americans have been required by the federal government to purchase a commercial product, said Devon Herrick, a senior fellow at the National Center for Policy Analysis in Dallas.
Requiring people to carry insurance takes away an individual's freedom of choice, he said, agreeing with the judge's decision to strike down that provision of the law.
"According to the judge, this dispute is about an individual's right to choose to participate," Herrick said. "One reason why individual choice is important is that the health insurance policies individuals will be required to purchase are saddled with mandated benefits and mandated providers that drive up the cost of coverage," he added.
"Moreover, the cost of this mandated health coverage will grow at twice the rate of the nation's income. It doesn't make sense to require individuals to purchase a product they cannot afford and fine them when they fail to purchase it," he stated.
DeAnn Friedholm, director of Consumers Union's health reform campaign, said: "This is a case that will likely wind up in the Supreme Court, since other courts have ruled in favor of the new health law. This law, while not perfect, finally protects American consumers against the worst practices of the health insurance industry. Until there is a final decision, we will continue to work hard to educate consumers about what is really in the health law and how they can get the best benefits from the system for their family's health and pocketbook."