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Federal Health Care Law Argued In Court This Week

When U.S. District Judge Roger Vinson in Pensacola declared last year’s federal health overhaul unconstitutional, the ruling vindicated Florida Republicans and other critics of the law.

But Wednesday, three appellate judges in Atlanta — including two appointees of former Democratic President Bill Clinton — will get their shot at the case.

Despite the political cacophony surrounding the law, the case largely boils down to this question: Does the Commerce Clause of the U.S. Constitution allow the federal government to require that most people have health insurance starting in 2014?

Florida and other states spearheading the lawsuit also make another key argument: The federal government is improperly trying to “coerce” them with the law’s expansion of Medicaid eligibility.

Ultimately, the U.S. Supreme Court is expected to decide those issues. But with 26 states involved in the case, Wednesday’s arguments at the 11th U.S. Circuit Court of Appeals will be closely watched.

The Obama administration will argue the law complies with the Commerce Clause, at least in part, because health care is part of a broad system of interstate commerce. That interstate commerce is affected by uninsured people who need health care but can’t afford to pay for it.

“Millions of people without health insurance have consumed health-care services for which they do not pay,” administration lawyers said in a brief filed in the appeals court. “They have thereby shifted the uncompensated costs of their care … to health-care providers regularly engaged in interstate commerce.”

But the states and other opponents argue that using the Commerce Clause to require Americans to buy insurance is unprecedented. Allowing it, they contend, would justify Congress making decisions about consumer spending on such products as food and housing.

“In the over 200 years that Congress has sat, it has never before attempted to exercise its Commerce Clause power in this manner,” the attorneys for the opponents wrote in a brief.

Vinson, a senior judge who was appointed to the federal bench by former Republican President Ronald Reagan, ruled in January against the Obama administration on the Commerce Clause issue. Vinson also went further, throwing out the entire federal law because he said the insurance requirement was a vitally interconnected part.

The requirement has always been the most-controversial part of the mammoth health law, which Obama and a Democratic-controlled Congress approved in March 2010. People who remain uninsured in 2014 will face financial penalties.

Bill McCollum, then Florida’s Republican attorney general, immediately filed the lawsuit last year in Pensacola and made the insurance requirement a centerpiece. Officials in 25 other states also joined the case, as did the National Federation of Independent Business and two individual plaintiffs.

As an indication of how politically charged the insurance requirement has become, the two sides in the lawsuit even describe it differently in the briefs. Obama administration lawyers describe it as the “minimum coverage provision,” while opponents call it an “individual mandate.”

While Vinson agreed with Florida and the other states on the insurance requirement, he rejected their argument that the law would improperly expand Medicaid eligibility.

The expansion, which would raise income-eligibility levels to allow more people to qualify for Medicaid, would help meet the law’s goal of almost all Americans having health coverage. During the first few years, the federal government would cover all of the costs of the newly eligible people, though states would have to pay 10 percent of the costs by 2020.

States that refuse to expand eligibility would lose billions of dollars in federal Medicaid funding. The law’s opponents contend that is unconstitutional, saying Congress may not “employ its spending power to coerce states into capitulating to federal demands.”

But Obama administration lawyers argue that state participation in Medicaid is voluntary and that Congress has the right to change the conditions of federal funding for the program.

Always shadowing the lawsuit has been the fierce partisan political fights about the health law. Those fights have played out in Washington and state capitals, such as Tallahassee, and also will be prominent during the 2012 presidential campaign.

That has also created scrutiny of the political backgrounds of the judges hearing the case. The judges Wednesday will include Clinton appointees Frank Hull and Stanley Marcus and Chief Judge Joel Dubina, who was appointed by former Republican President George H.W. Bush.

Dubina has received scrutiny in recent weeks because his daughter, U.S. Rep. Martha Dubina Roby, R-Ala., is an outspoken critic of the federal health law.