Federal judge rules that House has standing to sue to challenge ‘ObamaCare’ subsidies to healthcare insurers

ObamacareThe reason that the TanMan, Weeper of the House John Boehner, feels emboldened to threaten to sue the President every time that his Tea-Publican Caucus fails to achieve their prime directive of obstructing all things Obama, it is because the federal court system has been packed with conservative activist judges who stand at the ready to give Tea-Publicans a second bite at the apple to continue their fight in another forum.

This was the case on Wednesday when a conservative activist judge ruled that the TanMan and the House have standing to pursue a legal challenge to the Affordable Care Act aka “ObamaCare.” GOP scores early win in ObamaCare lawsuit:

A federal district judge on Wednesday delivered a blow to the Obama administration, ruling that the House Republican lawsuit against ObamaCare can move forward.

“The Court concludes that the House has standing to pursue those constitutional claims,” Judge Rosemary Collyer wrote in a 43-page decision.

The ruling is an early victory for Speaker John Boehner (R-Ohio), who has repeatedly touted the lawsuit to his conference. It also gives new hope to Republicans who have been so far stymied in their efforts to dismantle the five-year-old healthcare law.

* * *

Still, the court cautioned that Wednesday’s ruling should not be seen as a sign that either side will win the case.

“The Court stresses that the merits have not been briefed or decided; only the question of standing has been determined,” Collyer wrote.

The Obama administration said it plans to immediately appeal the decision.

“The district court’s decision is unprecedented and the Department of Justice has indicated it plans to seek immediate appellate review,” spokeswoman Jen Friedman wrote in a statement to The Hill.

“This case is just another partisan attack, and we believe that ultimately the courts will dismiss it for what it is — an inappropriate attempt to involve the judiciary in disputes between the other branches,” she wrote.

The court ruled that Boehner can challenge the Obama administration for its use of executive power in spending “billions of unappropriated dollars”  to support the healthcare law.

House Republicans have argued that the Obama administration illegally overstepped its powers when it began paying $175 billion to insurance companies with money that was requested — but never approved — by Congress.

Instead, the administration began making its own payments into a “cost-sharing” program that helps cover insurance companies’ costs of covering the newly insured.

Health and Human Services Secretary Sylvia Mathews Burwell, who is named in the case along with Treasury Secretary Jack Lew, has argued that the separate pool of funds was intended to “to improve the efficiency in the administration of subsidy payments.”

Collyer rejected the second piece of the GOP’s lawsuit, in which Boehner contested the Department of the Treasury’s decision to waive a requirement for employers to provide health insurance without consulting Congress.

The House’s claims “concern only the implementation of a statute, not adherence to any specific constitutional requirement,” Collyers wrote in dismissing the claim.

Ian Millhiser provides the legal analysis at Think Progress. Republicans Notch A Big Victory In The Obamacare Wars:

In a familiar story that has now played out twice before, a Republican-appointed judge breathed life into a lawsuit widely viewed as unlikely to prevail by many legal experts.

It remains to be seen whether Judge Rosemary Collyer’s opinion survives contact with a higher court. Nevertheless, if past is prologue, her lone decision will be sufficient to cause judges, the media and potentially even the Supreme Court to treat this case as a major threat to Obamacare.

United States House of Representatives v. Burwell is, in many ways, quite different from the two previous Supreme Court cases attacking President Obama’s signature health care law. For one thing, it’s unclear just how much of a threat this case presents to the Affordable Care Act as a whole, while the other two cases threatened to gut the law or even potentially repeal it in its entirety.

House challenges subsidies paid to health insurers in order to compensate them for reducing out-of-pocket costs for relatively low-income beneficiaries — the Republican-controlled House claims that these subsidies were never properly appropriated by Congress. If the subsidies are cut off, that could cause costs to spike for many individuals who can ill-afford such higher costs, but insurers likely have a number of tools which could allow them to ward off this worst case scenario. Insurers could effectively transfer the cost of these lost subsidies to higher-income consumers by increasing premiums — a different set of subsidies that are not challenged in this case ensure that the actual premiums paid by low-to-moderate income families and individuals does not exceed a certain threshold. Additionally, as Nicholas Bagley notes, insurers may still be able to receive the subsidies by bringing a suit in the Court of Federal Claims.

A victory for the House in this case, in other words, may only increase insurance companies administrative costs without preventing them from ultimately obtaining the subsidies authorized by the Affordable Care Act.

At least at this stage in the litigation, House also turns on a very different issue than the one presented in previous challenges to Obamacare. Ultimately, the most important issue in House is not likely to be whether the GOP lawmakers behind this lawsuit are correct regarding the merits of their case, it is likely to be whether they are allowed to sue the Obama administration at all.

As a general rule, lawmakers are not allowed to sue the executive because they disagree with the way that a presidential administration is implementing a law. Indeed, Judge Collyer acknowledges this general rule in her opinion, which throws out at least six of the House’s eight claims against the administration. Were she to allow all of the House’s claims to proceed, she writes, that decision “would contradict decades of administrative law and precedent, in which courts have guarded against ‘the specter of ‘general legislative standing’ based upon claims that the Executive Branch is misinterpreting a statute or the Constitution.’”

Yet, while Collyer pays enough heed to this general rule to dismiss most of the House’s claims, she preserves at least one of those claims due to a largely semantic distinction that Bagley quite justifiably labels as “incoherent.”

House ultimately turns upon a disagreement about whether certain money was appropriated by Congress. In the absence of a narrow appropriation allocating funds specifically for the subsidies at issue in this case, the Obama administration has paid out the subsidies from a permanent, more general appropriation which it claims may lawfully be used for this purpose. The House disagrees. Thus, this is a statutory case. It turns upon whether a particular statutory appropriation can or cannot be used for the purpose the Obama administration has used it for.

Judge Collyer, however, frames this litigation as a constitutional case. “The Congress (of which the House and Senate are equal) is the only body empowered by the Constitution to adopt laws directing monies to be spent from the U.S. Treasury,” Collyer writes. Thus, if the administration is, in fact, acting outside the terms of a statutory appropriation, that becomes a constitutional violation because only the Congress can decide the perimeters of federal spending. The House’s legal theory, Collyer claims, “does not turn on the implementation, interpretation, or execution” of a federal law. Rather, “the question presented is instead constitutional,” and this, she holds is reason to allow the House’s suit to move forward.

Collyer’s opinion takes an even more confusing turn, however, when she later explains that not all constitutional claims fit within her newly created rule. In essence, she limits her rule to legal challenges involving appropriations, and dismisses several other claims which allege that the Obama administration is violating some other provision of law. “If the invocation of Article I’s general grant of legislative authority to Congress were enough to turn every instance of the Executive’s statutory non-compliance into a constitutional violation,” Collyer writes, “there would not be decades of precedent for the proposition that Congress lacks standing to affect the implementation of federal law.” By contrast, “when the appropriations process is itself circumvented, Congress finds itself deprived of its constitutional role and injured in a more particular and concrete way.”

It’s a novel distinction establishing a novel limitation to a novel rule that carves out a novel exception to decades of established precedent. Indeed, Collyer’s reasoning is so unusual that even Jonathan Adler, one of the primary cheerleaders behind the last Supreme Court case seeking to gut the Affordable Care Act, writes that he would be “surprised” if Collyer’s reasoning prevails in the Supreme Court. Adler predicts that the House will lose this case 7-2 in the Supreme Court — a bold prediction considering the fact that he lists archconservative Justice Antonin Scalia as a likely vote for the Obama administration.

Nevertheless, Collyer’s decision is a victory for the Republican-led House because it casts yet another cloud of legal uncertainty over the Affordable Care Act just months after the Supreme Court signaled that it is fed up with litigation trying to take out the law. If nothing else, Collyer’s opinion will ensure that many of the best and brightest legal and health policy thinkers in the Democratic Party waste much of the next year defending against yet another anti-Obamacare lawsuit rather than looking for new ways to improve the health care system.

It’s always about providing grist for the mighty Wurlitzer of the right-wing noise machine of the conservative media entertainment complex. It is never about governing responsibly.

UPDATE: From Daily Kos, Judge ruling on House’s Obamacare case significant departure from precedent: Judge Rosemary Collyer’s unorthodox decision that the Congress can sue the White House over a dispute about Obamacare spending didn’t come as a total shock to the Justice Department. This is the George W. Bush-appointed judge who mulled impeachment as a remedy for the House in arguments.

 

2 responses to “Federal judge rules that House has standing to sue to challenge ‘ObamaCare’ subsidies to healthcare insurers

  1. “… the federal court system has been packed with conservative activist judges…”

    That’s odd, I always thought the federal court system was packed with liberal activist judges. In truth, this was one of the things the Founders warned us about. They said that the Judiciary could – and would, if allowed – become the dominant force of government. Today it really doesn’t matter what the Executive or the Legislative Branches want to do, it isn’t Law until the Supreme Court says it’s law. The Courts effectively legislate from the bench, they force culture from the bench and they even allocate funding from the bench. It is NOT a good way to govern…

  2. Your tax $$ “hard at work”. This is why we can’t have nice things…like infrastructure and excellent schools , for starters. Instead, they cost the taxpayers tens of millions on this happy horse crap. Vote. Every.Single.Time.