WASHINGTON -- President Obama's health care law survived a long-shot challenge Tuesday when a federal appeals court panel tossed out a lawsuit that contested the way it was enacted by Congress.
The three-judge panel ruled unanimously that Congress did not violate the Constitution's Origination Clause, which requires "bills for raising revenue shall originate in the House of Representatives."
In the case of the health care law, the Senate in 2010 took a House revenue bill, erased everything but the bill number, and inserted the health care law. But the appeals court panel said that was irrelevant because the law's requirement that individuals purchase health insurance does not make it a tax bill.
"It is beyond dispute that the paramount aim of the Affordable Care Act is 'to increase the number of Americans covered by health insurance and decrease the cost of health care,'" Judge Judith Rogers said. She was joined by Judges Cornelia Pillard and Robert Wilkins, both named to the court by Obama.
"Where, as here, the Supreme Court has concluded that a provision's revenue-raising function is incidental to its primary purpose, the Origination Clause does not apply. The analysis is not altered by the fact that the shared responsibility payment may in fact generate substantial revenues."
Timothy Sandefur, principal attorney for the conservative Pacific Legal Foundation, which brought the challenge, criticized the ruling and vowed to appeal. "Today's decision is disappointing, because it relied on a new and unprecedented distinction to exempt the Obamacare tax from the Constitution's rules for enacting taxes," he said..
The decision, which can be appealed to the full court or the Supreme Court, removes but one challenge to the law. At least two others remain:
• A different three-judge panel of the same court ruled last week that federal subsidies making insurance affordable to low- and middle-income Americans cannot be offered in states that use the federal marketplace, rather than their own. That panel did not include any Obama nominees.
• The Supreme Court ruled in June that the administration cannot require that closely held corporations offer health insurance policies that include all forms of contraception to their employees if the owners have religious objections.