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Health care reform challenge fails to win rehearing from appeals court


A federal appeals court decided Friday it will not rehear a case considered one of the last significant legal challenges to President Obama’s signature health care reform law.

The plaintiff in the case, Washington artist Matt Sissel, plans to appeal to the U.S. Supreme Court, said Timothy Sandefur, an attorney for Mr. Sissel with the Pacific Legal Foundation, which is backing the case.

Mr. Sissel and his attorneys had asked the U.S. Court of Appeals for the District of Columbia Circuit to rehear the matter before a full court after a three-judge panel sided with the government last year. Mr. Sissel had argued that the Affordable Care Act is unconstitutional because it is a revenue-raising law that originated in the House rather than the Senate. He also said the law violated the commerce clause of the Constitution.

Democrats have said the bill did technically originate in the House as a different measure centering on first-time homebuyers’ credit for military members.

In their order rejecting the request, the majority of judges noted that “the Supreme Court has not once found a law in violation” of the clause requiring revenue bills to start in the House. In the ruling against Mr. Sissel last year, the court said the ACA’s purpose was not to raise revenue.

Dissenting judges, however, wrote that even though they, too, would side with the government, they agree with Mr. Sissel that the ACA is a revenue-raising statute.

“By newly exempting a substantial swath of tax legislation from the origination clause, the panel opinion degrades the House’s origination authority in a way contrary to the Constitution’s text and history, and contrary to congressional practice,” wrote Judge Brett Kavanaugh, joined by three other judges. Judge Kavanaugh was appointed by President George W. Bush.

Mr. Sandefur said he’s pleased that the dissent concludes that the court’s original ruling “creates a dangerous new precedent that creates a loophole in the Constitution.”

“I think the Supreme Court is likely to see why that’s so important,” Mr. Sandefur said.

But Tim Jost, a law professor at Washington and Lee University and an ACA supporter, doubts the Supreme Court will take up the issue.

“I think it pretty much puts a nail in the coffin of any type of origination clause argument,” Mr. Jost said.

Parallel case

At least one other live case, Hotze v. Burwell, makes the same argument as the one in Sissel, but a panel of the 5th U.S. Circuit Court of Appeals deep-sixed that one, too, ruling that the plaintiff didn’t have standing to sue. The plaintiff in that case has likewise asked for a rehearing before a full panel of judges, but the court has not yet made a decision.

House Republicans, meanwhile, continue to pursue a lawsuit against the Obama administration over the health care law. The House argues that the administration is illegally spending money that Congress never appropriated for the law’s cost-sharing provisions, which include reduced deductibles, co-pays and co-insurance for some beneficiaries, depending on income. A U.S. District Court judge is now considering whether the House has standing to sue.

In June, the U.S. Supreme Court sided with the government in King v. Burwell, which was widely considered to be the most serious threat to the ACA. The justices held 6-3 that the law allows premium subsidies in all states, not just those with their own exchanges.

Lisa Schencker writes for Modern Healthcare, a sister publication of Business Insurance.

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