US judge tosses challenge to Obama healthcare law

Last Updated: Fri, Dec 03, 2010 05:10 hrs

A federal judge in Virginia on Tuesday dismissed a lawsuit challenging the landmark healthcare law championed by President Barack Obama, upholding key provisions that require health insurance coverage.

The challenge, one of several attempting to strike down the law, was brought by the conservative Christian Liberty University and individuals who said the law would violate several parts of the US Constitution.

However, US District Judge Norman Moon ruled that the law requiring individuals to buy health insurance coverage as well as requiring employers to buy coverage for their employees was legal under the Commerce Clause of the US Constitution.

Moon found that without the coverage requirements in the law, the cost of health insurance would increase because the number of insured individuals would decline, "precisely the harms that Congress sought to address with the Act's regulatory measures."

Interstate commerce would be hurt by large employers failing to offer adequate healthcare coverage, thus "the employer coverage provision is a lawful exercise of Congress' Commerce Clause power," said Moon, who was appointed by then-Democratic President Bill Clinton.

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Lawyers for Liberty University, which was founded by conservative evangelical Jerry Falwell, were not immediately available for comment.

The state of Virginia has filed its own challenge to the healthcare law and 20 other states have sued to strike down the law in a federal court in Florida. Rulings are expected in the coming weeks and months.

Many of the challenges centre on whether the federal government can regulate whether or not someone fails to buy a good or service under the Commerce Clause and whether the fines are a tax.

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Even though Obama has said previously that the penalties would not function as a tax, the federal government has argued in court that they are and it is entitled to levy them. Opponents counter that they are punitive fines which the government is not entitled to impose.

Judge Moon characterised the fines as "penalties" rather than a tax, noting that they are not designed to raise revenue but merely to "enforce the requirement that individuals and employers purchase or provide health insurance."

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Further, opponents of the law have argued that it illegally permits federal funding for abortion but Moon said "they fail to allege how any payments required under the Act, whether fines, fees, taxes, or the cost of the policy, would be used to fund abortion."