SCOTUS: Health Care Reform Update 1

The first briefs in the health reform litigation were due last week.  As the deadline approached, the challengers sought to add new plaintiffs.

The individual plaintiff in National Federation  of Independent Businesses v. Sebelius, may no longer have standing to sue. The Wall Street Journal reports that she has closed her business and filed for bankruptcy protection and is now receiving unemployment compensation. A video of an interview with her is available here.

 In order to challenge a law in court, especially before it becomes effective,  the challenger must  be able to point to some concrete injury, a way that he or she is harmed by the law now. Her participation in the lawsuit was based on her status as a business owner; she alleged that she  had to set aside money now to cover the cost of health insurance in 2014, preventing her from meeting other needs of her business, including hiring employees. 

 The National Federation of Independent Businesses (NFIB) had joined with this individual and another member to challenge the  individual mandate. The government did not challenge the standing of the NFIB or the individual plaintiffs, but expressly conceded standing only as to this individual.

The change in her situation reinforces the reasoning  that sometimes leads courts to find that a case is not ripe. In other words,  there is not yet a live dispute between the parties because the situation may change. We don’t know what the future holds, and the law may not apply to them when it becomes effective.

The NFIB has asked to add two new  individuals as plaintiffs to keep the challenge alive. The government does not oppose the request.One is the sole proprietor in the business of home renovations and building contracting. He alleges that his usual medical expenses are only $100 per year, and his previous policy through the Chamber of Commerce cost him $6,000.  He says he doesn’t need insurance and paid his own expenses when he last needed health care,when he injured himself with a chainsaw.

The other new plaintiff is a flooring contractor who is not covered by his wife’s employer-sponsored health insurance. He has one employee, who works part-time.  Both allege they will be harmed by the individual mandate because they must investigate the cost of coverage and plan to meet this “unwise”expense instead of spending their moneyon their businesses or on other priorities. 

In another challenge to PPACA, the Ninth Circuit Court of Appeals rejected a claim of standing in Baldwin v. Sebelius. The individual in that case alleged as injury that he did not want to  be compelled to buy insurance and had to investigate whether he was in compliance with the law. He did not specifically allege that he had no insurance, however, and the court would not infer that he was uninsured from his allegation that he was opposed to the requirement. His opposition was a”generalized grievance”, that is, he was not harmed by the law in any specific way.

The Supreme Court’s order  specifying the issues to be argued does not mention either ripeness or standing to challenge the individual mandate. However,  to the extent that standing or ripeness is a jurisdictional requirement, the court can address the issue at any time.