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Utah, 12 other states file anti-health reform lawsuit

Published March 23, 2010 6:16 pm

Politics » Shurtleff calls challenge 'an uphill battle' ; BYU law professor labels it 'a fool's errand.'
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A group of 13 attorneys general filed a federal lawsuit Tuesday challenging the constitutionality of health care reform a mere seven minutes after President Barack Obama signed the bill.

That mostly Republican group includes Utah Attorney General Mark Shurtleff, who believes Congress trampled the rights of individuals and states by requiring most people to buy insurance or pay a fine and by greatly expanding the size of Medicaid.

The health reform bill "represents an unprecedented encroachment on the liberty of individuals," the suit contends, with the attorneys general arguing the Constitution doesn't give the government the right to force people to buy insurance, known as the individual mandate.

"Our goal is to eliminate the individual mandate and stop the Medicaid expansion, but we don't want to kill the legislation entirely," Shurtleff said shortly after the filing in a Florida federal court. Like many of the other states involved, Utah recently passed a new law banning individual mandates, placing it in direct conflict with the federal reforms.

Brigham Young University law professor Frederick Gedicks said the lawsuit has little chance of success, particularly in striking down the insurance requirement.

"The challenge to the individual mandate is a fool's errand," said Gedicks, a constitutional law scholar.

White House spokesman Adam Abrams said, "These challenges have no merit and they will not stop historic reform from taking place.

Shurtleff acknowledged the suit filed in Florida faces a difficult path and put its chances of success at about 50 percent, but he also said the staffs of the AG offices involved "are no slouches."

"Whenever you sue in federal court asking the federal court to limit federal power you are fighting an uphill battle, there is no doubt about it," he said.

The individual mandate goes into effect in 2014 and those who fail to buy insurance would face a $95 penalty, which would go up to $695 per individual by 2016 or no more than $2,085 for a family.

Supporters of health reform say the mandate is justified by the government's right to regulate interstate commerce and is needed to stop cost shifting from the uninsured to those who have coverage. The lawsuit counters this by saying the requirement punishes an individual for not taking an action and "inactivity by its very nature cannot be deemed to be in commerce."

Gedicks thinks that argument is simplistic and flies in the face of existing law.

"I can't think of a clearer case of a constitutional tax than the individual mandate," he said. "For this lawsuit to succeed, the Supreme Court would have to undo a century of tax and spending jurisprudence."

He said the government could easily argue the tax is necessary for the success of a larger regulatory scheme, which would block insurance companies from denying people coverage because they have pre-existing conditions.

The second big issue in the lawsuit is a planned Medicaid expansion, which will cover millions of poor adults who are not currently eligible for the program jointly run by the federal and state governments. The attorneys general argue the states will not be able to afford their share of the expansion and can't back out of Medicaid or millions will be left without a safety net.

Under the new law, the federal government would pick up the entire cost of the new enrollees for a few years before states must pick up their share. But states, such as Utah, that are already chafing under the high costs of the program, say the expansion may force tax increases.

"The federal government will boost its Medicaid funding, but not soon enough and not nearly enough to cover that expansion," Shurtleff said.

The suit also argues that the federal government is requiring states to set up new health insurance marketplaces, known as exchanges, without giving them the needed funding.

Gedicks thinks this issue is more serious than the individual mandate claim, but he still expects the courts to uphold the health reform law.

"The bottom line is the states have a choice: They can either expand Medicaid or drop out of the Medicaid system, rather than set up the exchanges," said Gedicks, who is a self-described Democrat who is in favor of the health reform effort. "Nobody is holding a gun to the head of any state and insisting it be in the Medicaid system."

The states involved in the lawsuit are Utah, Florida, South Carolina, Nebraska, Texas, Michigan, Pennsylvania, Alabama, South Dakota, Idaho, Washington, Colorado and Louisiana. All of these attorneys general are Republicans except for Louisana's Buddy Caldwell, who is a Democrat. Virginia filed a separate suit challenging the individual mandate on Tuesday.

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