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Health Freedom Watch
August 2010


  • Virginia Overcomes First Hurdle in Health-Insurance Mandate Challenge
  • Missouri Passes Law Rejecting Mandate
  • CMS Chief Asks “Will We Ration With Our Eyes Open?”
  • Medicare Chief Actuary Publishes “Alternative Report”

  • Virginia Overcomes First Hurdle in Health-Insurance Mandate Challenge

    Virginia overcame the first hurdle in its constitutional challenge to the federal health-insurance mandate August 2, when the U.S. District Court for the Eastern District of Virginia denied the U.S. government’s motion to dismiss the state attorney general’s lawsuit.  The suit claims the mandate conflicts with the Virginia Health Care Freedom Act, which protects state residents from any legal requirement that they buy health insurance.  

    The 32-page opinion stated, “Although this case is laden with public policy implications and has a distinctive political undercurrent, at this stage the sole issues before the Court are subject matter jurisdiction and the legal sufficiency of the Complaint.” 

    The court recapped the commonwealth’s complaint that: 

    • “…requiring an otherwise unwilling individual to purchase a good or service from a private vendor [which Section 1501 of the law does] is beyond the outer limits of the Commerce Clause…. Succinctly put, the Commonwealth defies the Secretary [of HHS] to point to any Commerce Clause jurisprudence extending its tentacles to an individual’s decision not to engage in economic activity.” 
    • “…since Section 1501 [of the law] exceeds this enumerated [Commerce Clause] power, Congress cannot invoke either the Necessary and Proper Clause or its taxation powers to regulate such passive economic activity.” 
    • “…Section 1501 is in direct conflict with the Virginia Health Care Freedom Act…. [and] therefore encroaches on the sovereignty of the Commonwealth and offends the Tenth Amendment to the Constitution.” 

    The federal government argued that the Virginia attorney general lacks standing to challenge Section 1501 and that because the mandate doesn’t take effect until 2014, the issues were not ripe for immediate resolution.  

    Judge Henry Hudson, however, responded, “The issues in this case are fully framed, the underlying facts are well settled, and the case is accordingly ripe for review.  The Commonwealth has therefore satisfied all requirements of … standing.” 

    The Washington Examiner reports, “The case, Commonwealth of Virginia v. Kathleen Sebelius, will continue on October 18, 2010, at 9:00 a.m. in the U.S. District Court for the Eastern District of Virginia in Richmond. The summary judgment hearing is to determine if the federal health care law is unconstitutional.” 


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    Missouri Passes Law Rejecting Mandate

    The following is a press release from the American Legislative Exchange Council:

    (Washington, DC/August 4)—[On August 3], the state of Missouri voted [71 to 29] to pass Proposition C, also known as the “Health Care Freedom Act,” barring governments from requiring people to have health insurance. The measure conflicts with a key provision of the new federal health care law that requires people to have health insurance or pay fines by 2014. The proposition is modeled after the American Legislative Exchange Council's (ALEC) Freedom of Choice in Health Care Act, which has now been introduced or announced in 42 states.  

    “The people of Missouri sent a clear message to the President and Congress: we don't want government-mandated health care,” said Missouri Senator Jane Cunningham, ALEC board member and lead sponsor of the referendum. 

    “Each individual vote on this proposition was an individual voice expressing frustration and disappointment with our federal government—we just hope the leadership in Washington hears this majority's voice,” Cunningham added.  

    The proposal passed the Missouri House and Senate with bipartisan support and then was placed on the August 3 primary ballot. The proposition brought controversy and led some within the state to bring a lawsuit disputing the state constitutionality of drafting such a proposal. Cole County Circuit Judge Paul Wilson dismissed the suit, and which opponents failed to appeal.  

    "Proposition C will give Missourians the ultimate exit strategy at a time when Americans are faced with an unconstitutional federal requirement to purchase health insurance," said ALEC Health Task Force Director Christie Herrera, who is coordinating the nationwide effort.

    "It will give Missouri standing in the current lawsuit against the federal health law; allow Missouri to launch future, 10th-Amendment-based challenges against the federal government if the current lawsuit is thrown out of court; and empower the attorney general to take up the case of individuals harmed by the mandate," Herrera added.  

    ALEC's Freedom of Choice in Health Care Act has already been enacted in statute form by the Virginia, Idaho, Arizona, Georgia, and Louisiana legislatures, and constitutional amendments will appear on the November ballot in Oklahoma, Arizona, and Florida. Active citizen initiatives are also underway in Colorado and Mississippi.  

    A complete map with links to the legislation in each state is available online at


    • “ALEC Applauds Missouri Vote to Allow Health Care Act to Proceed,” press release from the American Legislative Exchange Council, August 4, 2010:
    • “Obamacare Repeal Gains Momentum,” by Deroy Murdock, Scripps Howard News Service, August 5, 2010: 

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    CMS Chief Asks “Will We Ration With Our Eyes Open?”

    By Twila Brase, R.N.  

    Should the political appointee who will oversee the nation’s largest pot of taxpayer health-care dollars be subjected to public scrutiny and congressional approval?  

    On July 7 President Obama made a controversial “recess” appointment of pediatrician Donald Berwick to head the Centers of Medicare and Medicaid Services (CMS).  The appointment bypassed the usual Senate confirmation process, therefore precluding public discussion.  One has to wonder whether Obama did this to avoid scrutiny of Dr. Berwick’s publicly stated love for England’s National Health Service (NHS) rationing system.  

    In a 2008 speech Berwick told a British audience, “I am romantic about the NHS; I love it. All I need to do to rediscover the romance is to look at healthcare in my own country.”  The NHS is notorious for rationing health-care services. Yet Berwick lauds Britain’s [National Institute for Health and Clinical Excellence] NICE rationing board, saying, “NICE is not just a national treasure; it is a global treasure.” 

    In the United States Berwick will be in charge of policy, treatment, and payment decisions for the approximately 47 million Medicare recipients and 58 million Medicaid recipients. The federal health-care reform law could add another 15 million recipients to the Medicaid rolls, leaving potentially 120 million people affected by the president’s unilateral installation of Berwick. 

    Meanwhile, Berwick’s warning about forthcoming rationing is pretty clear. “The chronically ill and those toward the end of their lives are accounting for potentially 80% of the total health care bill out there,” he says.  “There is going to have to be a very difficult democratic conversation that takes place. The decision is not whether or not we will ration care. The decision is whether we will ration with our eyes open.” 


    • “Obama Plans Recess Appointment of Medicare-Medicaid Chief,” by Noam Levey, Los Angeles Times, July 7, 2010.
    • “Why Donald Berwick is Dangerous to Your Health,” by Hal Scherz,, May 26, 2010. 

    Twila Brase, R.N., is president of Citizens’ Council on Health Care in Saint Paul, Minnesota

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    Medicare Chief Actuary Publishes “Alternative Report”

    The following is a health-policy alert from John Goodman’s blog: 

    For the first time in Medicare history, the Medicare Chief Actuary has called the projections in a Medicare Trustees Report “unreasonable” and “implausible” and encouraged everyone to ignore them and view instead an “Illustrative Alternative” report. The alternative opens this way: 

    “The Trustees Report is necessarily based on current law; as a result of questions regarding the operations of certain Medicare provisions, however, the projections shown in the report do not represent the ‘best estimate’ of actual future Medicare expenditures.” 

    Noting that the formal Trustees report assumes Medicare physician fees will be reduced by 30% over the next three years, Chief Actuary Richard Foster says that’s “implausible.” In addition, the Trustees report assumes Medicare fees will fall below Medicaid rates by 2019 and fall further and further behind private payment rates in future years… 

    As explained in an April 22 report by Foster, the health reform law will cause: 

    • Cuts in Medicare spending of $575 billion over the next decade.
    • 7½ million members of Medicare Advantage plans to lose their coverage and cause another 7½ million to face higher premiums and benefit cuts.
    • About one in seven facilities—hospitals, skilled nursing facilities, home health agencies, and hospices—to become unprofitable and possibly drop out of Medicare altogether.
    • Many doctors to quit seeing Medicare patients entirely.  

    The alternative report says that the number of facilities that would become unprofitable will grow to 25% by 2030 and 40% by 2050 if the health reform law is implemented as written. 

    John Goodman is president of the National Center for Policy Analysis in Dallas, Texas 

    Source:  “Unprecedented: Medicare Chief Actuary Disavows Trustees’ Report, Publishes an “Alternative Report,” John Goodman’s Health Policy Blog, National Center for Policy Analysis, August 5, 2010:

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    Health Freedom Watch is published by the Institute for Health Freedom. Editor: Sue Blevins; Assistant Editor: Deborah Grady. Copyright 2010 Institute for Health Freedom.