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Feds ask court to throw out states' suit challenging health overhaul

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Health care reform

Feds ask court to throw out states' suit challenging health overhaul

Responding to a legal challenge from 20 states to the health overhaul, the Obama administration says it has constitutional power to regulate interstate commerce and impose taxes, The Wall Street Journal reports. The lawsuit, led by Attorney General Bill McCollum, a Florida Republican, contends that Congress can't require Americans to buy insurance. The response argues that isn't the case: It's a tax on not having coverage, not a requirement to get it. "Congress was entitled to pass a law punishing people who go without coverage because their decision could impose future costs on the nationwide health system, the filing said." The filing also argued that the states don't have standing to challenge the law, because the provisions in question don't take effect until 2014 and therefore all damages are "speculative" (Adamy and Perez, 6/18).

The Associated Press: "McCollum said Thursday that the government's defenses clash with comments Obama made during the health care debate, 'including the president's insistence on national television that the purchase mandate was absolutely not a tax.' In its arguments for the motion to dismiss, the Justice Department says the requirement to buy coverage is an exercise of Congress' constitutional power to tax and spend. 'The Supreme Court has long held that an exercise of this power is valid, even if it has a regulatory function, even if the revenue purpose is subsidiary, and even if the moneys raised are 'negligible,'' wrote a team of government lawyers led by Assistant Attorney General Tony West." The judge set a Sept. 14 hearing date on the motion to dismiss (Kaczor, 6/17).

The Jacksonville Observer: "[T]he federal government also argued against charges that the reform effort illegally requires states to expand Medicaid programs, which McCollum and others say is a direct violation of states' rights guaranteed in the 10th Amendment of the U.S. Constitution." The 10th Amendment says states retain powers not explicitly granted to the federal government. The administration "argues that Congress has the power to determine how federal money appropriated for Medicaid may be spent and can give states an option of setting up their own health exchanges or having the federal government do so." Other Medicaid changes have cleared court challenges, and states can drop out of the program altogether if they don't like new requirements (6/18).

Here's McCollum's statement responding to the filing, courtesy of Foster Folly News (6/17).

Politico Pulse adds that the federal response says "Congress has the authority under the commerce clause (the 'necessary and proper' clause) and its power to tax 'to promote the general welfare.' The last point is likely to reignite the debate over whether the individual mandate penalty is a tax -- and one that would surely hit those making under $250,000 that President Obama said he wouldn't tax. The court filing hedges that argument by calling it a tax with a 'regulatory function' based on a volitional event" (Kliff and Haberkorn, 6/17).

Kaiser Health News is an editorially independent news service. It is a program of the Kaiser Family Foundation, a nonpartisan health-care-policy research organization unaffiliated with Kaiser Permanente.

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