Judge Strikes Down Insurance Mandate in Health Reform Law

On Monday, U.S. District Court Judge Henry Hudson ruled that the federal health reform law's individual mandate is unconstitutional, agreeing with plaintiffs in a Virginia lawsuit that the mandate exceeds Congress' power to regulate interstate commerce, the New York Times reports (Sack, New York Times, 12/13).

However, the ruling -- which marks the first time that a judge has struck down a central provision in the law -- did not invalidate the law or block its implementation, the Washington Post notes.

Virginia Attorney General Ken Cuccinelli (R) filed the lawsuit in March just hours after the new reform law was enacted, arguing that the mandate -- which requires nearly all U.S. residents to obtain health coverage by 2014 or pay a penalty -- also conflicts with a state law that protects state residents from such federal insurance mandates (Helderman/Goldstein, Washington Post, 12/14).

Hudson's Ruling

In his 42-page ruling, Hudson dismissed the Obama administration's argument that because all U.S. residents would need health care services at some point, the coverage requirement simply is a way to regulate how they would pay for their care.

He wrote that requiring people to purchase insurance "would invite unbridled exercise of federal police powers." He added, "At its core, this dispute is not simply about regulating the business of insurance -- or crafting a scheme of universal health insurance coverage -- it's about an individual's right to choose to participate."

Hudson also rebuffed the administration's argument that federal taxation law permits the government to levy a penalty on individuals who fail to obtain insurance coverage, the Wall Street Journal reports. The penalty "lacks a bona fide intention to raise revenue," he wrote.

However, Hudson declined to grant the plaintiffs' request to set an immediate nationwide injunction against the entire law or the individual mandate pending an appeal (Adamy, Wall Street Journal, 12/14).

Next Steps in Lawsuit

Hudson is the third federal district court judge in one of more than a dozen similar lawsuits to rule on the overhaul.

In recent months, U.S. district court judges presiding over a lawsuit in Detroit and a separate challenge in Lynchburg, Va., dismissed those complaints. The Michigan lawsuit now is being reviewed in an appellate court in Cincinnati, while the Virginia challenge is under review at the Fourth Circuit Court of Appeals in Richmond, Va. (New York Times, 12/13).

Under standard procedures for such cases, the Cuccinelli lawsuit would proceed to Richmond appellate court for further review, CQ HealthBeat reports (Norman, CQ HealthBeat, 12/13).

The Times notes that judges at the Richmond appeals court now would have to consider opposite rulings on the same issue (New York Times, 12/13). Although the Department of Justice is expected to appeal Hudson's ruling, it is not clear how soon it plans to act, according to the Post.

Meanwhile, Virginia Gov. Robert McDonnell (R), who welcomed Hudson's ruling, has launched an effort to gather other state governors to press DOJ to bypass the appeals court review and fast-track the case to the U.S. Supreme Court, the Post reports.

Following Hudson's ruling, Cuccinelli said he is continuing to seek the administration's help in moving the suit directly to the Supreme Court, but he declined to say whether he plans to file an independent petition. He said a fast-track review in the high court "is about creating certainty and finality," noting that a "normal process" that would take years is "just unacceptable for business, for doctors and for states" (Washington Post, 12/14).

However, some legal experts predict that a fast-track petition would face challenges along the way, Politico reports.

Charles Fried -- a Harvard Law School professor and former U.S. solicitor general in the Reagan administration -- said, "Given that the health care mandate doesn't kick in until 2014, the argument for expediting it is not really strong," adding, "It's quite an unusual thing to do" (Haberkorn/Kliff, Politico, 12/14).