House Obamacare Lawsuit to Proceed in Federal Court

A federal judge has rejected the Obama Administration’s efforts to dismiss a pending lawsuit filed by the House of Representatives over allegedly inappropriate spending by the President to fund key portions of his signature healthcare legislation.  The ruling doubles down on a decision last month that allowed some of the claims found in the House Obamacare lawsuit to proceed, and likely means that the case will be decided on its merits rather than legal procedure.

US House of Representatives files Obamacare Lawsuit in 2014

Last November the House of Representatives filed a federal lawsuit alleging that President Obama violated the US Constitution by unilaterally reworking key aspects of his Affordable Care Act (ACA) healthcare law.  The House lawsuit zeroed in on two key claims against the President:

  • Repeated delays of the employer mandate violated the terms of the legislation and could not be authorized without approval from Congress
  • Payments to insurance companies under a cost-sharing provision which allows insurers to provide healthcare to low-income Americans were not authorized by the terms of the law as it was passed. These payments totaled $3 billion in 2014 – a figure the House claims could climb as high as $175 billion over the next decade.  These subsidies were included in the ACA, but Congress refused to appropriate money for them, leading the President to unilaterally authorize the paymets.

In response to the House of Representative’s Obamacare lawsuit, the Administration argued that the House did not have legal standing to sue the Executive in federal court.  Central to the Obama Administration’s standing argument was the contention that the House has not suffered a real or actual injury as a result of the President’s actions.  Under federal law, a plaintiff must be able to prove he or she suffered a harm, and the House lawsuit has been the subject of intense criticism for allegedly failing to satisfy the standing requirement.

Federal Judge Partially Grants House Standing in Obamacare Lawsuit

Last month, after nearly a year of legal wrangling and political posturing, Federal Judge Rosemary Collyer allowed the House lawsuit to proceed on one of its two claims: that the President violated the terms of the ACA by unconstitutionally authorizing billions of dollars in subsidy payments to insurance companies that provide low-income healthcare.  According to Judge Collyer’s ruling, the House suffered a harm because it refused to authorize subsidy funding, but had its authority circumvented by President Obama’s decision to distribute the funds regardless of Congressional action.  The Constitution endows Congress with the “power of the purse,” and Judge Collyer felt circumventing this authority may constitute a harm suffered by the House.

The other claim – that the President unconstitutionally authorized continued delays of the employer mandate – was dismissed because the House did not have standing to challenge the action in court.  According to Judge Collyer, the House had not suffered a claim by that particular executive action, and thus could not issue a legal challenge in federal court.

As a result of Judge Collyer’s ruling last month, United States House of Representatives v. Burwell was allowed to proceed to a decision on the merits.  Judge Collyer told the parties that she intends to issue an opinion on the merits quickly after both sides present a final round of briefs arguing the legal questions over the President’s action.  Before the case could proceed, however, President Obama requested Judge Collyer allow an immediate appeal of the standing decision to the United States Court of Appeals for the District of Columbia.

Federal Judge Denies President’s Request for Immediate Appeal in Obamacare Lawsuit

Over the objection of the Administration attorneys, Judge Collyer denied President Obama’s request for an immediate appeal of her standing ruling.  This week, Judge Collyer denied the motion for immediate appeal, writing in her opinion the case should be decided on the merits of the case before proceeding to the Court of Appeals for the DC Circuit.  Writing that allowing an immediate appeal on the standing issue would not “materially advance the ultimate termination of the litigation” Judge Collyer argued that deciding the case on the merits would allow the Court of Appeals in DC to determine all relevant questions – including standing and merit issues.

Responses to the House Obamacare lawsuit ruling echoed arguments for or against the litigation since its inception last November.  Democrats and Administration attorneys condemned the lawsuit for not only wasting public resources, but setting a dangerous precedent by allowing one branch of the federal government to sue another branch in federal court – an action that could jeopardize the delicate separation of powers that enforces checks and balances across all three branches.  House Speaker John Boehner expressed satisfaction for the decision, writing in a statement the ruling is an “important step toward holding the president accountable for his unconstitutional actions.”

Judge Collyer will likely issue a decision on the merits within a month, and the case will unquestionably be quickly appealed to the Court of Appeals for the District of Columbia to address both standing and merit related questions.

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