The day President Obama signed the healthcare reform into law the Thomas More Law Center filed a lawsuit arguing that a key provision in the new law that requires all U.S. citizens to have health insurance by 2014 was unconstitutional. Specifically, the Center maintained that it was an unconstitutional tax outside Congressional authority for the government to fine individuals who did not get health care coverage by the deadline. However, U.S. District Court Judge, George Streeh, of the Eastern District of Michigan recently ruled that Congress does have the right to enforce the provision under the Commerce Clause of the American Constitution.
In addition, the judge did not grant the injunction that the Center sought, and he also dismissed two other claims in the lawsuit. However, there are still four additional claims that have yet to be reviewed. The Center is not alone in its lawsuit—in fact, several other lawsuits, including one filed by failed gubernatorial hopeful Mike Cox, have sought to halt the healthcare reform law. Most of them argue that a federal government does not have the right to force individuals to purchase a product simply because they are American citizens. Nevertheless, the U.S. government argues that interstate commerce has been regulated by Congress for hundreds of years.
One of the main arguments that the Center made in its lawsuit is that an individual’s choice not to purchase healthcare coverage represents “economic inactivity” rather than “economic activity”, preempting it from the clause in the U.S. constitution that gives Congress the power to regulate interstate commerce. However, Judge Streeh ruled that by choosing not to purchase insurance, an individual is making an economic decision to try to pay for health care services later, out of pocket, rather than now by buying insurance coverage. Consequently, that decision would later translate into billions of dollars in costs onto other market participants since most individuals cannot actually pay for their medical costs out of pocket in the long run.