- The Washington Times - Monday, August 2, 2010

A federal judge on Monday refused to dismiss a challenge by the state of Virginia to President Obama’s landmark health care reform law, a setback that will force his administration to mount a lengthy legal defense.

The decision came as the Obama administration released an upbeat report that said the new health overhaul law is starting to produce savings for Medicare and will eventually add more than a decade of solvency to the program’s trust fund.

In the opening salvo of the legal fight, U.S. District Judge Henry Hudson allowed Virginia to go forward with its suit, which argues the requirement that its residents have health insurance was unconstitutional.

Judge Hudson, who noted that his ruling was an initial step, decided the law was ripe for review and that the issues the state raised had not been fully tested in court.

“While this case raises a host of complex constitutional issues, all seem to distill to the single question of whether or not Congress has the power to regulate — and tax — a citizen’s decision not to participate in interstate commerce,” Judge Hudson said, referring to the health care purchase requirement.

The new law is a major cornerstone of Obama’s domestic agenda and administration officials have vigorously defended it as constitutional and necessary to stem huge increases in costs for health care.

Virginia’s lawsuit is one of several trying to undo the law aimed at overhauling the $2.5 trillion health care system.

The fight over the health care law is expected to be a major theme leading up to the November midterm congressional elections. Republicans have advocated repealing the measure, forcing the White House and Democrats to defend it.

The Justice Department, arguing on behalf of the Obama administration, has said the suit should be dismissed because Virginia lacks standing to challenge the health care law. Instead, a person having to pay a fine for not having health insurance as required by the new law would have to sue.

Virginia has countered that the health care law would represent the first time the U.S. government forces its citizens to buy something.

With the rejection of the Obama administration’s effort to dismiss the case, arguments now will be set to hear the merits of the arguments.

Regardless, other lawsuits will proceed, including one filed in Florida by more than a dozen states. Legal analysts say there is a good possibility one of these cases will reach the highest court in the country.

In Monday’s report, the administration said Medicare will save about $8 billion by the end of next year, and as much as $575 billion over the rest of the decade, the report said.

“This reflects the priority we put on acting quickly to secure Medicare’s future,” Health and Human Services Secretary Kathleen Sebelius told reporters.

Release of the analysis comes ahead of the official annual financial checkup for Social Security and Medicare from program trustees, due later this week. Monday’s report provides support for the administration’s position that the health care law strengthens health care for seniors, but the trustees’ report could well call attention to deeper problems, as has happened in the past.

Republicans have argued that spending cuts called for in the health care law will undermine Medicare, and the government’s own nonpartisan analysts have questioned whether some of the reductions are politically sustainable. Polls show that seniors are more skeptical of the health overhaul than younger people, a political dilemma for Democrats in the fall congressional elections.

The report says savings from the cuts will help to lower seniors’ monthly premiums by nearly $200 annually by 2018.

Medicare spending will keep increasing, but not as fast. Under the health care law, spending will rise by 5.3 percent a year on average over the next decade, compared with 6.8 percent without the cuts.

The Medicare trust fund will remain solvent until 2029, a gain of more than a decade from 2017. However, critics say trust-fund solvency will only improve on paper, since actual savings from the Medicare cuts would have been spent to provide coverage for more than 30 million uninsured Americans.

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