Congressional standing to contest ACA insurance subsidies allowed but decision is in question
In a somewhat unusual decision rendered on September 9, 2015, Judge Rosemary Collyer of the United States District Court for the District of Columbia held that the U.S. House of Representatives has standing to sue the Obama Administration regarding an insurance cost-sharing program instituted to implement the Affordable Care Act (ACA). The House argued that the administration was spending unappropriated money that Congress had never specifically approved for the purpose. The Administration of course disagrees. While much has been made of this decision by advocates and press commentators alike, it should be noted that the holding, which already is the subject of a petition seeking an interlocutory appeal, does not decide the merits question; it only allows the lawsuit to proceed.
United States House of Representatives v. Burwell
GersonThe federal courts are courts of limited jurisdiction. They are not empowered to render advisory opinions or abstract policy analyses, but are restricted by Article III of our constitution to adjudging real “cases or controversies.” That is, matters of genuine dispute brought by parties that can set forth a cognizable injury in fact resulting from the challenged activity. The ability to bring such a federal suit is known as “standing,” and Congress and its members rarely are allowed this status. Indeed, Judge Collyer’s opinion appears to represent the only time that congressional standing has ever been approved in a case about appropriations. It is easy to see why.
Congress’s appropriations power derives from the constitution’s Article I mandate that it is only the legislative branch, i.e., Congress, that has the power to tax and spend and, in support of that power: “No money shall be drawn from the Treasury, but in consequence of appropriations made by law.” Where the executive undertakes a spending activity that Congress believes is unauthorized, Congress generally needn’t sue; it simply can exercise its power of the purse to cut off funding.
Moreover, unelected courts are generally resistant to involving themselves in disputes between the two elected branches of government over their policy differences, preferring those branches to battle it out in the political arena.
The underlying dispute itself relates to a program under Section 1402(a)(2) of the ACA by which the government provides subsidies to insurance companies to offset out-of-pocket costs of insuring certain persons in qualified health plans. The House is alleging that the funds the Administration was using for the offsets had never gone through a required annual appropriations process . The administration does not contest the requirement for congressional approval, but asserts that Congress in fact had made the requisite appropriation through general funds. Without reaching that question, Judge Collyer held that the House’s allegations implicated a constitutional right and that the House had at least alleged a cognizable injury.
At the same time, Judge Collyer rejected an additional claim by the House that the president had violated the Constitution by whittling down and delaying the implementation of the Affordable Care Act’s “employer mandate”-the provision of the ACA that subjects certain larger employers to penalties if they do not offer affordable healthcare benefits to full-time employees and their dependents. Collyer held that these actions were purely administrative implementations of a statutory provision and did not create an injury to Congress that could be redressed under the constitution.
As to the merits issue of whether a line-item appropriation was necessary or whether a general appropriation suffices to give the executive branch the right to spend on the insurance subsidies, the difference is a very fine one-one of the sort that the courts generally have avoided in the past. Whether Judge Collyer will get to decide that question or is blocked from doing so by a reversal on appeal will be the subject of judicial wrangling that will play out over the next several months.
ABOUT THE AUTHOR
Stuart M. Gerson is a member of Epstein Becker & Green’s Litigation and Health Care & Life Sciences practices.