GOP challenges to health law loom
Suits may unravel reform, even wipe it off the books
WASHINGTON — The Affordable Care Act could get nicked by the Supreme Court next year when the justices take up the mandate that most businesses provide free coverage for contraception.
But that’s not the only legal hurdle it faces.
In courtrooms across the country, Republican state attorneys general and conservative groups are challenging the way the law was passed, the way it was worded and the bureaucracy it created.
For President Barack Obama and the millions of Americans who stand to benefit from the law’s insurance expansion, the good news is that the lawsuits are long shots. Most are pending at federal district courts, which gives the government more time to implement the law and could make judges less likely to rule against it.
Still, a favorable appeals court ruling in any of the cases might lead to another Supreme Court showdown like the one expected in March or April, when the justices will consider business owners’ religious objections to providing certain types of birth control coverage.
“An act this complicated was always going to raise additional legal questions,” said Randy Barnett, a Georgetown University law professor who was a primary force behind the original legal challenge to the health care law.
Perhaps the most closely watched lawsuits are those in the District of Columbia, Virginia, Oklahoma and Indiana that, ironically, accept the law’s wording at face value.
As passed by Congress and signed by Obama in 2010, the law offers federal subsidies to — and threatens tax penalties on — individuals and businesses in state marketplaces, or exchanges. But 35 states are served by a federal exchange, and while proponents in- tended for the subsidies to apply nationwide, the law refers to them only in state exchanges.
The lawsuits challenge an Internal Revenue Service rule that applies the hundreds of billions of dollars in subsidies to all states and subjects employers and taxpayers nationwide to penalties. A victory could threaten the subsidies, making health coverage unaffordable for millions and the health care marketplace unworkable.
One of the cases, Halbig v. Sebelius, will be back in federal district court in the District of Columbia on Tuesday. Judge Paul Friedman has said he will rule by midFebruary. Another case in Virginia could be decided before the end of the year.
“If the courts rule for us, a majority of the country is not going to be under the subsidy provisions,” says Sam Kazman, general counsel at the Competitive Enterprise Institute, who is coordinating the legal action. “Politically, that has a huge impact.”
Administration allies say the law clearly was intended to make subsidies available nation- wide, and the IRS rule is just a logical step in that process. “Courts usually do not reach conclusions that defy common sense,” says Robert Weiner, a former associate deputy attorney general and a leading defender of the health care law.
While those lawsuits could wreak havoc with the law, a longer-shot challenge has the potential to wipe it off the books.
That case, Sissel v. U.S., argues that the Affordable Care Act is a revenue-raising bill, which under the Constitution should have originated in the House of Representatives. After all, its proponents argue, Supreme Court Chief Justice John Roberts upheld the mandate that people buy insurance only because the penalty can be seen as a tax.
The conservative Pacific Legal Foundation, which mounted the lawsuit, contends that when Senate Majority Leader Harry Reid amended the House bill by wiping it out entirely and starting over, he violated the Constitution’s “origination clause.”
If that argument wins in court, says Cato Insti- tute health economist Michael Cannon, “not only do they have to strike down every other revenue measure in the law ... they would have to strike down the entire law.”
But no court ever has struck down a law based on its origination in the Senate rather than the House. U.S. District Court Judge Beryl Howell denied the challenge in June, reasoning that the law did originate in the House and was not the brand of revenue measure that had to start there anyway.
That case now goes to the U.S. Court of Appeals for the D.C. Circuit, where others soon will follow.
Yet another lawsuit comes from the conservative Goldwater Institute, an Arizona-based group that has challenged the powers of the Independent Payment Advisory Board, which was created under the law to control costs.
District Court Judge G. Murray Snow dismissed that portion of the institute’s challenge shortly after the law was upheld by the Supreme Court last year, but his ruling is being appealed.