Feds move to dismiss Va. health care reform challenge

John O'Brien May 25, 2010, 4:01pm


RICHMOND (Legal Newsline) - The federal government is asking a judge to dismiss the challenge to health care reform filed by Virginia Attorney General Ken Cuccinelli.

Cuccinelli filed his lawsuit soon after President Barack Obama signed the legislation into law in March. It is separate from a 20-state suit filed in Florida federal court in that it claims Virginia has passed a law that prevents the bill's individual health care mandate.

The legislation contains a mandate for individuals to have health insurance coverage or face an annual penalty of $695.

"The 'minimum coverage provision' that Virginia challenges here... is a linchpin of Congress's reform plan," says the motion to dismiss, filed Monday.

"Based on extensive hearings and expert evidence, Congress concluded that requiring the financially able to purchase health insurance would spread risks across a larger pool, which (as with all insurance) would allow insurers to charge less for coverage...

"Congress determined that, without the minimum coverage provision, the reforms in
the Act, such as the ban on denying coverage based on pre-existing conditions, would not work, as they would amplify existing incentives for individuals to 'wait to purchase health insurance until they needed care,' which in turn would shift even greater costs onto third parties."

Businesses with more than 50 workers would have to provide coverage or pay a $2,000-a-worker penalty if any of their employees get government-subsidized plans on their own.

"With this law, the federal government will force citizens to buy health insurance, claiming it has the authority to do so because of its power to regulate interstate commerce," Cuccinelli said.

"We contend that if a person decides not to buy health insurance, that person - by definition - is not engaging in commerce, and therefore, is not subject to a federal mandate."

Cuccinelli has also said the lawsuit would save the state about $1.1 billion from 2015-2022 if it is successful. That $1.1 billion figure represents new Medicaid requirements and does not take into account tax and fee savings to those who would have to pay them if they do not purchase health insurance.

From Legal Newsline: Reach John O'Brien by e-mail at jobrienwv@gmail.com.

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