Court: Congress Can Sue Admin on Obamacare Subsidies

WASHINGTON—Congress can sue President Barack Obama’s administration over a key part of Obamacare, a federal court has ruled. Lawmakers are challenging federal agencies granting tax subsidies to Americans for purchasing healthcare policies, because Congress has never appropriated funds for this part of the president’s controversial namesake law.

The U.S. House of Representatives voted months ago to authorize a lawsuit challenging two central aspects of the Obama administration’s actions involving the Affordable Care Act (ACA). The lawsuit challenges Secretary Jack Lew and the U.S. Department of the Treasury over granting taxpayer subsidies to cover part of the skyrocketing cost of healthcare under the ACA, as well as Secretary Sylvia Burwell and the U.S. Department of Health and Human Services (HHS), for carrying out Obama’s orders to ignore certain provisions of the law, and modify others. (For example, although the ACA’s “employer mandate” requires all businesses with over 50 employees to offer ACA-compliaint healthcare policies by 2014, Obama unilaterally suspended that mandate for 2014, then suspended it for 2015 for all companies with fewer than 100 employees.)

Although it received little media attention, on Sept. 9, 2015, Judge Rosemary Collyer of the U.S. District Court for the District of Columbia rejected Justice Department arguments that the challenge should be dismissed. Specifically, Collyer allowed the House’s suit to proceed to challenge Treasury’s grant of subsidies without congressional approval. Article I, Section 9, Clause 7 of the Constitution provides, “No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law.”

As Judge Collyer’s opinion held, “An appropriation must be expressly stated; it cannot be inferred or implied.” She also noted that “appropriations are an integral part of our constitutional checks and balances, insofar as they tie the Executive Branch to the Legislative Branch via the purse string.”

The only issue before the district court at this point is whether the U.S. House has standing to sue—that is, whether the House can drag the matter into court in a lawsuit to get a judge’s order that will rein in the president and his deputies.

Judge Collyer focused on the Supreme Court’s recent case, Arizona State Legislature v. Arizona Independent Redistricting Commission. Arizona’s voters had passed a statewide measure more than a decade ago, taking the legislature’s ability to draw legislative district boundaries, and creating a new, purportedly independent commission which would draw the lines after each census.

But the Elections Clause of the U.S. Constitution specifies that state legislatures draw lines for themselves and for Congress. So Arizona lawmakers sued, arguing that this statewide measure violated the federal Constitution because it “stripped the Legislature of its alleged prerogative to initiate redistricting.” One issue the court had to resolve first, however, was whether Arizona’s statehouse could even sue, invoking judicial authority to decide such a political dispute between elected branches of government.

The Supreme Court held that this statewide measure was an actual injury recognized by the courts, traceable to the defendant in the case (the commission), and that a court could remedy with a favorable decision. Therefore, the Court held, the plaintiffs had standing to sue.

Judge Collyer here followed the Supreme Court’s lead, holding that the federal courts have jurisdiction to rule on one of the U.S. House’s claims, the one arguing that “the Executive has spent billions of dollars without a valid appropriation” of funds by Congress. On that count, the court held that “the constitutional trespass alleged in this case would inflict a concrete, particular harm upon the House for which it has standing to seek redress.”

The court held that Congress did not have standing to sue over Obama’s effectively amending the ACA by delaying parts of the “employer mandate” and other provisions that proved difficult to administer or become politically problematic. That part of the case was dismissed, although the House can appeal the dismissal.

But the court rejected the administration’s argument that this entire lawsuit is about how to implement the ACA. Where appropriations are concerned, the district court reasoned that this case “is not about how [the subsidy provision] is being applied, but rather how it is funded.”

Justice Department lawyers will now take this adverse ruling to the U.S. Court of Appeals for the District of Columbia Circuit, which has been heavily stacked with Obama appointees since Senate Democrats used the “nuclear option” in 2013 to abolish filibusters for most judicial nominations.

Ken Klukowski is legal editor for Breitbart News. Follow him on Twitter @kenklukowski.