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New health-care law constitutional, federal judge rules

By N.C. Aizenman
Washington Post Staff Writer
Thursday, October 7, 2010; 11:32 PM

A federal judge in Michigan ruled Thursday that the new health-care overhaul law is constitutional, rejecting an argument that Congress lacked the power to create the legislation's "individual mandate," which requires virtually all Americans to purchase health insurance.

Other federal courts have already dismissed some challenges to the law on technical grounds - ruling, for instance, that the plaintiffs lacked standing. However, the decision issued Thursday by Judge George Caram Steeh of the Eastern District of Michigan is the first to reject a claim based on the merits, marking a notable victory for the Obama administration.

The plaintiffs, three people and the Thomas More Law Center, a nonprofit public interest law firm in Ann Arbor, had objected to being compelled to choose between buying health coverage that they do not want or paying a tax penalty that, they argued, would go into the nation's general fund and could end up paying for abortions.

They further argued that because the decision not to buy insurance is a form of inactivity rather than an economic activity, it is not covered by the clause of the Constitution that grants Congress the power to regulate interstate commerce.

However, Steeh found that "far from 'inactivity,' 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, collectively shifting billions of dollars . . . onto other market participants." Therefore, Steeh ruled, regulating this decision falls well within the scope of Congress's authority to regulate the health insurance market.

The judge also echoed the administration's contention that unless young and healthy people are required to purchase coverage, the pool of those who are insured would be skewed toward the sick, making it impossible for insurers to comply with protections such as the law's prohibition on discriminating against those with preexisting conditions.

"The court found that the minimum coverage provision of the statute was a reasonable means for Congress to take in reforming our health-care system," said Tracy Schmaler, a spokeswoman for the Justice Department. "The department will continue to vigorously defend this law in ongoing litigation."

Robert Muise, the law center's senior trial counsel, said he plans to appeal. But he added that despite the loss, he is pleased that Steeh sided with him and the other plaintiffs on their standing to file the suit, the ripeness of their claim and whether they have a right to a court determination of Congress's authority to write the legislation.

"The case is framed quite nicely since the judge ruled in our favor on [those issues]. So really the main question is whether or not Congress has exceeded its authority under the commerce clause, and I like our chances before the U.S. Court of Appeals of the 6th Circuit," he said.

The case is one of 15 to 20 lawsuits challenging some aspect of the health-care law, according to a Justice Department estimate.

Among the most prominent are a suit filed by 20 states in federal court in Florida and a similar suit filed by the state of Virginia before a federal judge there. They raise similar arguments as those in the Michigan suit but also mount additional constitutional objections to the law.

The judge in the Virginia suit denied a government motion to dismiss the case and is scheduled to hear oral arguments on the merits on Oct. 18.

A government motion to dismiss is still pending before the federal judge in Florida, but he has indicated that he, too, plans to deny it.

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