Uninsured Can Move Forward in HCR Challenge

May 5, 2011 (PLANSPONSOR.com) – A federal court has moved forward claims of uninsured plaintiffs in a challenge to the federal health care reform law, while saying the plaintiffs who have health insurance lack standing.

The U.S. District Court for the Western District of Oklahoma found the three uninsured plaintiffs allege two injuries fairly traceable to the challenged action of the defendants: the future injury of being compelled to purchase health care coverage which they have no desire to purchase, and a present injury of having to now investigate how the Patient Protection and Affordable Care Act will impact them and alternatives to their current provision for health care and of altering their finances and saving money for the imminent requirement in the Act that they purchase health insurance.  

The court rejected defendants’ argument that plaintiffs’ failure to allege facts showing that it is unlikely that events will occur which will render them not subject to the Act’s requirement that they purchase health insurance makes their injury speculative, The court said it is of the opinion that plaintiffs’ burden of pleading facts sufficient to establish a plausible future injury does not include eliminating all or even most contingencies that could obviate the future injury. “If the defendants’ position were correct, then courts would essentially never be able to engage in pre-enforcement review. Indeed, it is easy to conjure up hypothetical events that could occur to moot a case or deprive any plaintiff of standing in the future,” the opinion said.  

U.S. District Judge David L. Russell also noted there is a causal connection between the alleged injury and the challenged action of the defendants such that their injury is fairly traceable to the defendants and not the result of some third party’s independent action, and that it is likely, not merely speculative, that the declaratory and/or injunctive relief Plaintiffs seek will redress their injury.  

However, Russell found that the plaintiffs who currently have health insurance failed to allege an injury that is fairly traceable to the challenged action of the defendants and not the result of some independent action of some third party or of plaintiffs’ own actions – not caused by enactment of the PPACA.  

Even if the court were to consider the insured plaintiffs’ argument that they are now having to investigate how the Act will affect them and alter their current finances in preparation for the individual mandate in the health care law because the Act will cause the cost of health care insurance to rise due to the prohibition on denying coverage because of pre-existing medical conditions, the result is the same, Russell said. In their case, that insurance costs will increase as a result of the Act is mere speculation and speculation about future events does not constitute an injury in fact.   

In addition, the court noted that the Act does not require insurance companies to raise their premiums, and if insurance companies did so, any injury to plaintiffs would be the result of the insurance companies’ independent actions and not the challenged actions of the defendants.  

Finally, the court rejected all plaintiffs’ claims that the health reform law commits an equal protection violation. Russell said plaintiffs have failed to identify any specific provision(s) of the Act that provide “earmarks” or “special interest expenditures” for some groups, including unions, and not plaintiffs; that exempt some citizens from penalties or “taxes” while imposing same on others, including the plaintiffs, based on whether they choose to purchase health insurance; and that fund and benefit special interest organizations, including unions, “through tax exemptions and other mechanisms provided for in the Act based on their political views” while “denying similar funding to other individuals and organizations that do not share similar viewpoints,” including plaintiffs. “Indeed, Plaintiffs do not even allege that such unidentified provisions will not benefit Plaintiffs,” Russell wrote.  

The case is Calvey v. Obama, W.D. Okla., No. 5:10-CV-353.