Health-Law Mandate Ruled Unconstitutional

Health-Law Mandate Ruled Unconstitutional

Ralph Note: Without the individual mandate but with the requirement to issue insurance regardless of pre-existing conditions, here is what will happen:

People will drop their coverage, and wait until they are sick to get coverage. This will force rates to quadruple. Then insurance companies will make it more and more difficult to get coverage, and many will stop offering it.

By BRENT KENDALL

http://online.wsj.com/article/SB10001424053111904006104576504383685080762.html?mod=WSJ_hp_LEFTTopStories

A divided U.S. appeals court in Atlanta ruled Friday that a key provision of last year’s federal health-care overhaul is unconstitutional, siding with a group of 26 states that challenged the law.

The 2-1 ruling marks the Obama administration’s biggest defeat to date in the multifront legal battle over the health-care law.

The U.S. Court of Appeals for the 11th Circuit ruled that Congress exceeded its constitutional powers when it required individuals to purchase health insurance or pay a penalty.

“This economic mandate represents a wholly novel and potentially unbounded assertion of congressional authority: the ability to compel Americans to purchase an expensive health insurance product they have elected not to buy, and to make them re-purchase that insurance product every month for their entire lives,” Judges Joel Dubina and Frank Hull said in a jointly written 207-page opinion.

The ruling marked the first time a Democratic-appointed judge has found part of the Patient Protection and Affordable Care Act unconstitutional. Judge Hull was appointed by Bill Clinton, while Judge Dubina is a George H.W. Bush appointee.

The decision directly conflicts with a different ruling issued in June by a federal appeals court in Cincinnati that upheld the law. The disagreement between the circuits makes it a near certainty that the Supreme Court will eventually step in and provide the final word on the law’s constitutionality.

Several legal challenges are working their way through the nation’s courts, but Friday’s ruling came in the highest-profile lawsuit of them all: a case brought by 26 governors and attorneys general, almost all of them Republicans, from states including Florida, Ohio and Texas. The National Federation of Independent Business and two individuals were also plaintiffs in the case.

Stephanie Cutter, an adviser to President Barack Obama, said in a statement, “We strongly disagree with this decision and we are confident it will not stand.”

“Individuals who choose to go without health insurance are making an economic decision that affects all of us—when people without insurance obtain health care they cannot pay for, those with insurance and taxpayers are often left to pick up the tab,” Ms. Cutter said.

Florida Attorney General Pam Bondi said in a brief written statement that the ruling prevents Congress “from infringing on the individual liberty protected by the U.S. Constitution.”

The decision affirmed part of a January ruling by U.S. District Judge Roger Vinson of Florida, who ruled the health-insurance mandate unconstitutional.

The appeals court, however, overturned the portion of Judge Vinson’s decision that voided the entire health-care law. The court said the unconstitutional insurance mandate could be severed from the rest of the law, with other provisions remaining “legally operative.”

In dissent, Judge Stanley Marcus, a Clinton appointee, said the majority ignored Congress’s broad power to regulate commerce. The insurance mandate, he said, was a rational and permissible attempt to address the huge health-care costs that uninsured Americans impose on others.

The Cincinnati-based Sixth Circuit Court of Appeals upheld the health law on a 2-1 vote in June. The challengers in that case, four individuals and the Thomas More Law Center, a conservative legal organization, have already appealed that ruling to the Supreme Court. The high court is on summer break. Its new term begins in October and runs through June 2012.

A third appeals-court ruling on the constitutionality of the health law is expected soon from the Fourth Circuit in Richmond, Va. At issue in that case are two challenges, including one brought by Virginia Republican Attorney General Ken Cuccinelli.

Write to Brent Kendall at brent.kendall@dowjones.com

One response

my dad’s an Obama fan and he thinks the individual mandate is a good thing – because it incentivizes people to buy insurance before something goes wrong. He also says Obama’s plan encourages market based reforms. I’m a little skeptical, I don’t know what to believe.

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