Federal Appeals Court Upholds Individual Health Insurance Mandate

A U.S. appeals court on Wednesday upheld President Barack Obama’s landmark healthcare law that requires Americans to buy insurance as constitutional, an early victory for the White House.

The U.S. Court of Appeals for the 6th Circuit, based in Cincinnati, said the “minimum coverage provision is a valid exercise of legislative power by Congress under the Commerce Clause” of the U.S. Constitution.

The decision is the first at the appeals court level and legal experts say they expect the issue to ultimately be addressed by the Supreme Court later this year or next year, a critical time for Obama as he seeks re-election in 2012.

The Thomas More Law Center filed a lawsuit in Michigan the day Obama signed the healthcare measure into law, arguing the provision requiring Americans to buy coverage by 2014 under threat of penalty was beyond Congress’ authority and an unconstitutional tax.

A federal judge in Michigan upheld the law and the group appealed.

The appeals court affirmed that judge’s ruling, saying those who opt out of buying health insurance were still engaging in commerce because they were paying for healthcare services on their own and therefore the law was constitutional.

“Congress had a rational basis for concluding that, in the aggregate, the practice of self-insuring for the cost of healthcare substantially affects interstate commerce,” the court panel ruled in a 2-1 decision.

“The provision regulates active participation in the healthcare market, and in any case, the Constitution imposes no categorical bar on regulating inactivity.”

Federal judges in Virginia and Florida have struck down the individual mandate but the Obama administration has appealed and those decisions are expected in the coming weeks.

(Reporting by Jeremy Pelofsky and James Vicini)