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September 14, 2011

Pennsylvania Middle District Judge Rules Individual Mandate Unconstitutional

by Jonathan B. Stepanian, Esq.

In a ruling issued yesterday in Goudy-Bachman v. United States, United States District Court judge Christopher Conner held that the individual mandate provision of the Affordable Care Act — or “Obamacare” or “Obamneycare” depending on your political persuasion — is unconstitutional.  Judge Conner’s ruling adds to the myriad cases percolating through various federal courts on the trial and appellate levels throughout the country.

Goudy-Bachman arose from a York County couple’s lawsuit against the government challenging the constitutionality of the individual mandate under the Commerce Clause.  According to the opinion, the couple is self-employed and opted to drop all health care insurance coverage because the cost exceeded their mortgage payment.  They have since paid for occasional health care costs themselves.  However, under the Affordable Care Act, they would be required to purchase health insurance when the individual mandate provision of the Act takes effect on January 1, 2014.

In his opinion, Judge Conner squarely addressed whether the Commerce Clause of the United States Constitution empowers Congress to mandate that individuals purchase health insurance.  The answer:

The court concludes that it cannot. The power to regulate interstate commerce does not subsume the power to dictate a lifetime financial commitment to health insurance coverage.

Notably, Conner also held that the individual mandate provision of the Act was not severable from other provisions of the Act that guarantee coverage regardless of pre-existing conditions.  Therefore, because the funding offered by the individual mandate and the guarantees of coverage regardless of pre-existing medical conditions are so intertwined, Judge Conner held that they cannot be separated and must equally be stricken.  Conner says,

Congress clearly linked the individual mandate to the guaranteed issue and preexisting conditions reform provisions because it is a partial funding source for these provisions. Given the current structure of the Act, and with certain deference to the government’s perspective of Congress’s intent, the fate of the guaranteed issue reforms rises and falls with the minimum coverage provision.

Conner’s ruling in Goudy-Bachman is similar to a prior Florida District Court ruling, Florida v. U.S. Department of Health & Human Services.  There the Florida Court similarly held that the individual mandate provision of the Act was unconstitutional and so intertwined with other provisions of the Act that they all must be struck down.  That case was later appealed to the Eleventh Circuit Court of Appeals, which affirmed it in part and reversed it in part.  The Eleventh Circuit upheld the ruling that the individual mandate was unconstitutional but held that it was sufficiently severable from the remaining provisions of the Act that those other provisions, such as coverage of pre-existing conditions, could remain.

Now the question is, where will the Third Circuit fall in the mix of rulings brewing across the country on this issue.

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Jonathan B. Stepanian, Esq.

Jon is an attorney whose practice is specialized in litigation, complex medical professional liability defense, health care, and providing legal counsel on numerous issues associated with day-to-day hospital operations. He has successfully tried several cases to verdict as first-chair trial counsel before juries in both state and federal court. Jon has also represented clients in appellate litigation, mediation, and in connection with administrative agency investigations.

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