Government Responds to Health Care Reform Lawsuit

May 13, 2010 ( – In its first response to a legal challenge of the Patient Protection and Affordable Care Act, the Obama administration argues it has the constitutional right to require Americans to obtain health care.

The administration said the Thomas More Law Center and four individual plaintiffs have no standing to sue because they cannot show they are likely to suffer any harm as a result of the implementation of the provision requiring coverage. Aside from that, the administration contends that the minimum coverage provision is a valid exercise of Congress’ power to regulate interstate commerce.  

The response said plaintiffs’ claims that the provision falls outside of both Congress’s authority over interstate commerce and its power to tax and spend for the general welfare “are flatly wrong.” The administration argues the Anti-Injunction Act bars a suit to enjoin collection of a tax.  

The response noted that the lawsuit was filed four years before the provision it challenges takes effect; the plaintiffs demonstrate no current injury and merely speculate whether the law will harm them once it is in force. Though plaintiffs proclaim their current intent not to obtain health insurance, between now and 2014, changed health circumstances or other events could lead plaintiffs voluntarily to satisfy the minimum coverage provision or qualify for one of the Act’s exemptions covering those who “cannot afford coverage,” or who would otherwise suffer hardship if required to purchase insurance, the response said.   

Even if plaintiffs become liable for a penalty in 2014, they say their remedy would be to pay any assessed penalties to the IRS and then sue for a refund. “Given the availability of that remedy, any harm plaintiffs might conceivably sustain would be fully reparable,” the response said.  

As to the Commerce Clause, the administration notes that Congress specifically found that, in the interstate markets for health care and health insurance, the minimum coverage provision “regulates activity that is commercial and economic in nature: economic and financial decisions about how and when health care is paid for, and when health insurance is purchased.” The predicate of this finding, and a distinguishing feature of the health care market, is that virtually everyone will need medical services at some point. According to the response, Congress had a rational basis to conclude that economic decisions not to purchase insurance to pay for these services, taken in the aggregate, substantially affect interstate commerce by, among other things, shifting costs to third parties, “increas[ing] financial risks to households and medical providers,” precipitating personal bankruptcies, raising insurance premiums, and imposing higher administrative expenses.  

The administration also noted that apart from its power under the Commerce Clause, Congress also has authority under its power to tax and spend to “provide for the . . . general Welfare,” and the determination of what furthers the general welfare is for Congress to make, “unless the choice is clearly wrong, a display of arbitrary power, not an exercise of judgment.”  

Finally, the administration argues that the balance of equities and the public interest weigh strongly against granting preliminary relief. While any harm to plaintiffs is speculative and, in any event, reparable, the consequences of an injunction are not, the response said. “Congress determined that the health care system in the United States is in crisis, spawning public expense and private tragedy. After decades of failed attempts, Congress enacted comprehensive health care reform to deal with this overwhelming national problem. The minimum coverage provision is vital to that comprehensive scheme. Enjoining it would thwart this reform and reignite the crisis that the elected branches of government acted to forestall.”  

The administration’s response is here.