Latest Healthcare Ruling A Double-Win For Obama

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September 12, 2011 | Affordable Care Act, In The Courts

Reuters

By Andrew Cohen

Sep 9 2011, 2:10 PM ET

The 4th U.S. Circuit Court of Appeals ruled that the state of Virgina has no case to sue the government over federal heath care reform.

The 4th U.S. Circuit Court of Appeals gave a double victory Thursday to the White House, the Justice Department, and other supporters of the Patient Protection and Affordable Care Act. Actually, you could call it a double-double.

Not only did the three-judge panel of federal judges dismiss two separate challenges to the new health-care law. But it did so on jurisdictional grounds, which means the justices of the United States Supreme Court now may have other viable legal options available to them next year should they wish to avoid resolving this battle on the merits. And judges typically love to resolve cases without getting to the merits if they can get away with it.

In Virginia v. Sebelius, a unanimous panel declared that Virginia had no standing to sue for what state lawyers claimed was a “sovereign injury” caused by the federal health care law. Virginia couldn’t get around federal jurisdictional rules, the 4th Circuit ruled, just because the state had enacted its own measure, the Virginia Health Care Freedom Act. The state law — which states that “[n]o resident of this Commonwealth… shall be required to obtain or maintain a policy of individual insurance coverage” — was signed into law one day after President Barack Obama signed into law the federal health measure.

Noting the timing and purpose of Virginia’s statute, the 4th Circuit essentially called out the Commonwealth for its blatant attempt to manipulate its way into federal court. Here’s how Judge Diana Gribbon Motz put it (and I’m citing the kinder passages):

Contrary to Virginia’s arguments, the mere existence of a state law like the VHCFA does not license a state to mount a judicial challenge to any federal statute with which the state law assertedly conflicts. Rather, only when a federal law interferes with a state’s exercise of its sovereign “power to create and enforce a legal code” does it inflict on the state the requisite injury-in fact.

By contrast, the VHCFA regulates nothing and provides for the administration of no state program. Instead, it simply purports to immunize Virginia citizens from federal law… To permit a state to litigate whenever it enacts a statute declaring its opposition to federal law, as Virginia has in in the VHCFA, would convert the federal judiciary into a “forum” for the vindication of a state’s generalized grievances about the conduct of government.

So, at last, we have an ACA ruling without much discussion about the “individual mandate” or any discussion at all about the “broccoli mandate” or the “action-inaction” dichotomy that has marked each of the prior rulings over the constitutionality of the law. Remember last month how it took the 11th Circuit 300 pages to explain why the Care Act was (and was not) constitutional? Thursday’s first ruling was a scant 33 pages long — 16 of which were devoted to a listing of all the advocates who joined in the fight. My kinda ruling!

[I interrupt this analysis to employ a sports metaphor. Basketball. With the feds driving the lane (in the form of the Affordable Care Act), Virginia stepped directly in their path (with the late-arriving VHCFA) hoping for a charging call from the referee. Instead, the ref, the 4th Circuit, called Virginia for a blocking foul. That explains this first case perfectly well. Let’s now resume the non-metaphoric analysis]

The other ACA case decided Thursday by the 4th Circuit was Liberty University v. Geithner, a 140-page opinion which will make tax law professors howl with delight because it generated opinions from all three of the panelists. None were willing to allow challenges to the Care Act to proceed. All were appointed to their judicial posts by President Bill Clinton. Two rejected the arguments made here both by the Administration and the plaintiffs — that the court had jurisdiction to reach the merits of the case. See what I mean about courts always looking for the easy way out?

Judge Motz ruled that the private plaintiffs in the case had no standing at the present time to challenge the Affordable Care Act’s “individual mandate” because Supreme Court precedent (and the Anti-Injunction Act) precludes tax lawsuits before taxes are collected. Judge James A Wynn was even more emphatic in his belief that the “individual mandate” constituted a tax and therefore could not be challenged. The third judge, Andre Davis, dissented, declaring that the tax issue did not preclude evaluating the Act on its merits. It’s constitutional, he ruled.

The Liberty University ruling thus adds to the looming Supreme Court debate a few new legal avenues the justices may be willing to explore. For example, will Justice Anthony Kennedy or Chief Justice John Roberts see in the jurisdictional issues a way out, a compromise, that would both dispose of the pending cases and help protect the Court from the inevitable political criticism it will receive no matter how it rules on the merits? It’s a question the justices will have to confront right in the middle of next spring’s primary season. And it’s a question more legitimately raised today in the wake of the 4th Circuit ruling than it was yesterday.

In any event, for those of you keeping score at home, at the federal appeals court level, the score now is 2-1 in favor of the Care Act and its supporters. The 4th Circuit and 6th Circuit have rejected challenges to the new law. The 11th Circuit has embraced such challenges. Soon, perhaps in the next month or so, we’ll hear from the 3rd Circuit and then we’ll all be able to move on toward the next phase of the legal battle over health care. The 4th Circuit’s analysis may be right, if may be wrong, but either way it’ll give the justices much more to think when the briefs start piling up late this year or early next.

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