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House Sues Obama Over Health Law Employer Mandate, Insurer Payments

By Todd Ruger, CQ Roll Call

November 21, 2014 -- The House filed its long-awaited lawsuit last week against the Obama administration, asking the federal courts to declare the president acted unconstitutionally and to stop payments to insurance companies under the health care law.

The lawsuit is a Republican response to a series of President Barack Obama's unilateral executive actions that lawmakers say are unconstitutional. It comes the day after Obama further angered Republicans by announcing more immigration executive actions.

"Time after time, the president has chosen to ignore the will of the American people and rewrite federal law on his own without a vote of Congress," House Speaker John A. Boehner said in a statement.

"If this president can get away with making his own laws, future presidents will have the ability to as well," Boehner said. "The House has an obligation to stand up for the Constitution, and that is exactly why we are pursuing this course of action."

The lawsuit, however, faces what could be insurmountable legal barriers, constitutional law experts say. The House will have to demonstrate that the institution has been harmed by Obama's actions, and has little recourse otherwise, according to an analysis by The Heritage Foundation.

The House has other options—like impeachment or a resolution condemning the president—and the federal courts have been reluctant to referee disputes between the other two branches of government.

The lawsuit focuses on two ways the Obama administration implemented the health care law, claiming the House has been injured because the executive branch has, "among other things, usurp[ed] the House's legislative authority."

First, the House challenges how the administration twice waived the health care law's employer mandate and the penalties for companies failing to comply with it.
Second, lawmakers challenge what they call "the unlawful giveaway" of $175 billion over the next 10 fiscal years to insurance companies under a Department of Health and Human Services cost-sharing program, even though Congress has never appropriated funds for the program.

The administration is making Section 1402 Offset Program payments from the same account as Section 1401 Refundable Tax Credit Program payments—something the health care law does not permit, the lawsuit states.

"The Constitution does not permit such a sleight of hand," the lawsuit states. It names as defendants the Department of Health and Human Services and the Department of Treasury, along with the secretaries of those agencies.

The focus on the offset program is a surprising twist to the lawsuit and puts a focus on an unsettled debate about one of the more obscure parts of the health care law—cost-sharing subsidies.

The cost-sharing subsidies from Section 1402 are not the same thing as the health care law's premium tax credits from Section 1401. The tax credits help pay monthly premiums charged by plans in the health insurance marketplaces. The cost-sharing subsidies help pay for such out-of-pocket expenses as deductibles and copays and also are used to lower the total amount someone has to pay for health care in any given year.

If the House can press its case on the merits, there could be an appropriations law dispute about whether the Section 1402 spending is considered discretionary or mandatory under the health care law.

Republicans think that the statute does not have "the right language" to appropriate funds for the cost-sharing reduction payments, said Timothy S. Jost, a law professor at Washington and Lee University who supports the law.

"The position of the Administration apparently has been that this is mandatory spending because it's part of the premium tax credits and that's the way the CBO scored it," Jost said, referring to the Congressional Budget Office. "It's all part of the same package."

The House lawsuit asks the U.S. District Court for the District of Columbia to find the actions unconstitutional. And the House wants the court to stop Treasury Secretary Jacob J. Lew and the Treasury Department from making any additional Section 1402 Offset Program payments to insurers unless and until Congress enacts a law appropriating funds for those payments.

A White House spokesman called the lawsuit "unfortunate" during a press gaggle.

"At a time where we—I think the American people want Washington focused on jobs and the economy, the House Republicans choose to sue us, sue the President for doing his job—and using taxpayer resources at the same time—for a lawsuit that their own Congressional Research Service could not identify any merit for," Principal Deputy Press Secretary Eric Schultz said.

House Minority Leader Nancy Pelosi, D-Calif., in a statement called the lawsuit a "bald-faced attempt to achieve what Republicans have been unable to achieve through the political process."

"The legislative branch cannot sue simply because they disagree with the way a law passed by a different Congress has been implemented," Pelosi said. "It is clear, as one leading legal scholar put it, that this lawsuit is 'an embarrassing loser.'"

The lawsuit does not challenge Obama's immigration action announced last week. Boehner's office told reporters the House might add immigration to the health care lawsuit.

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