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Doctors' Obamacare Lawsuit Dismissal Affirmed by D.C. Circuit

By Jenny Tsay, Esq. on March 11, 2014 | Last updated on March 21, 2019

The D.C. Circuit has affirmed the dismissal of a lawsuit brought by medical doctors challenging the constitutionality of the implementation of Obamacare.

In Association of American Physicians and Surgeons v. Sebelius, one of the arguments asserted by the plaintiffs was that Congress violated the Origination Clause of the U.S. Constitution when it enacted the Patient Protection and Affordable Care Act.

The case had been dismissed by the D.C. District Court for lack of standing and failure to state a claim by the association. The doctors appealed that dismissal, but were unsuccessful.

Origination Clause

The Origination Clause, aka the Revenue Clause, states that all bills for raising revenue must originate in the House of Representatives, but the Senate may amend or concur as with other bills.

"All bills for raising revenue" only pertains to bills that levy taxes, so bills for other purposes which incidentally generate revenue aren't included under the clause.

For example, a statute that's created by Congress which aims to raise revenue to support a particular government program, but isn't a law that raises revenue to support the government in general, won't be covered under the Origination Clause.

Challenges to the Origination Clause

In the medical association's challenge, appellants argued that since Obamacare contained revenue-raising measures, the bill had to originate in the House of Representatives, according to the Constitution.

You'll recall the ACA's health insurance mandate was held to be valid exercise of taxing power by SCOTUS.

Well, that's a problem, the doctors argued, because although the Act has a House bill number, the bulk of the bill was produced in the Senate. The appellants asserted that only after amendments were made in the Senate did the bill actually transform into a revenue bill.

While a ruling on the application of the Origination Clause to the bill could have a serious impact on the legislative process, the D.C. Circuit didn't directly address the issue. Instead, the D.C. Circuit addressed the district court's dismissal of the case.

The district court ordered the medical association to file supplemental pleadings after the SCOTUS decision in NFIB v. Sebelius was handed down. However, the district court ruled that because the doctors' group didn't raise the Origination Clause claim in its original pleading, the claim was conceded.

The D.C. Circuit agreed because the District Court didn't ask for a briefing on the overall impact of the NFIB opinion, only on whether the decision required the dismissal of any claims. So applying the standard motions to dismiss rules was appropriate.

The District Court's decision was affirmed.

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