Tuesday, March 23, 2010

Twelve States Plan Lawsuit Over Obama Health Overhaul (Update2)

Business Week.com

Adds Virginia suit in the second paragraph, Michigan to list of states in eighth.)

By Pat Wechsler

March 22 (Bloomberg) -- Twelve states plan to challenge the constitutionality of the health-care overhaul passed yesterday by the U.S. House, according to statements made today.

Florida Attorney General Bill McCollum said Florida, Texas and Pennsylvania are among 11 states that will sue “as soon as the president signs the bill,” claiming it places a burden on already cash-strapped states to pay for an expanded Medicaid program and build an exchange so individuals can find affordable insurance. Virginia Attorney General Ken Cuccinelli also said in a statement his state would sue on the similar grounds.

States nationwide are facing unprecedented declines in tax collections, according to the Nelson A. Rockefeller Institute of Government in Albany, New York, and are cutting spending on these health programs for low-income residents. Florida will have to spend an additional $1.6 billion for Medicaid alone and hire 1,000 new workers to accommodate the overhaul, McCollum said.

“This is a bad bill,” McCollum told a press conference in Orlando, Florida. “That’s a political determination and a practical one.”

He said the mandate for individuals to buy some form of health insurance is unconstitutional. It also infringes on the ability of states to provide other services, such as education, to its citizens because of the cost burdens, he said.

Virginia Lawsuit

Cuccinelli, the Virginia attorney general, said today he also planned to sue the federal government, calling the health bill an “unconstitutional overreach of its authority.

“With this law, the federal government will force citizens to buy health insurance, claiming it has the authority to do so because of its power to regulate interstate commerce,” he said in a press release. “We contend that if a person decides not to buy health insurance, that person -- by definition -- is not engaging in commerce, and therefore, is not subject to a federal mandate.”

The states that say they will sue are Alabama, Florida, Michigan, Nebraska, North Dakota, Pennsylvania, South Carolina, South Dakota, Texas, Utah, Virginia and Washington.

(For more on the health-care overhaul, {EXT2 }

--Editors: Andrew Pollack, Robert Greene

To contact the reporter responsible for this story: Pat Wechsler at pwechsler@bloomberg.net

To contact the editor responsible for this story: Reg Gale at Rgale5@bloomberg.net