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February 11, 2015

Affordable Care Act Challenger

New Questions Swirl on an Affordable Care Act Challenger

Plaintiff Listed Motel as Her Address, Which Was Basis for Her Legal Grounds


By Louise Radnofsky and Louise Radnofsky

One of the plaintiffs in the Supreme Court case against the Affordable Care Act listed a short-term-stay motel as her address when she joined the lawsuit, potentially calling into question her basis for suing.

Rose Luck is among four plaintiffs suing the Obama administration to eliminate tax credits under the law that make health insurance cheaper for millions of Americans. They say the wording of the 2010 law allows consumers to tap the credits only in states that run their own insurance exchanges, and not their home state of Virginia, which is one of as many as 37 states that use the federal enrollment system.

The plaintiffs say that, by making their insurance more affordable, the tax credits subject them to the law’s requirement that they carry insurance or pay a fee, which they oppose.

Ms. Luck described herself in court papers as a 55-year-old resident of Petersburg, Va., in the fall of 2013, when the litigation was initiated. The address she provided is for the American Inn motel a short distance from Interstate 95. A receptionist at the inn said Sunday that Ms. Luck didn’t currently live there and that residents weren’t allowed to stay more than 28 days.

Ms. Luck’s address was used by her attorneys and the government to calculate the cost of insurance plans for people her age in her ZIP Code, as well as the value of insurance tax credits. That information was relevant for determining whether Ms. Luck’s situation qualified her to be a plaintiff in the case. Her right to bring the case, or “standing,” already had been subject to questions during earlier stages of the litigation on whether she was exempt from the penalty for not buying coverage because her income was too low.

The Wall Street Journal reported Friday that two male plaintiffs in the case could also be subject to a dispute over their legal standing to sue, because as Vietnam veterans they likely qualified for care through the Department of Veterans Affairs that would fulfill the law’s requirement for them to have coverage or pay a penalty.

The Competitive Enterprise Institute, the libertarian think tank that initiated and bankrolled the case, said it believes all the plaintiffs are still entitled to bring the case. Even if a court disagreed, the lawsuit wouldn’t be in jeopardy so long as the claims of the fourth plaintiff, Brenda Levy, are on solid legal footing. Critics of the challenge have seized on the issues surrounding the plaintiffs as proof they had no real involvement in the case and aren’t harmed by the insurance subsidies. “All of these plaintiffs are people they picked off the street for this litigation,” said Tim Jost, a law professor at Virginia’s Washington and Lee University who supports the health law.

The Supreme Court is scheduled to hear oral arguments in the case March 4. If it sides with the plaintiffs and strikes down the subsidies in federally run exchanges, the health law could unravel, supporters and opponents say.

The Department of Health and Human Services said Monday that almost 6.5 million people were likely to get tax credits in those 37 states for 2015, and that each person’s credits had an average value of $268 a month.

CEI spokeswoman Annie Dwyer confirmed that staff knew Ms. Luck used a motel address when the suit was filed and that she was no longer there. Attempts to reach Ms. Luck were unsuccessful. Ms. Dwyer said Ms. Luck still lived in Virginia, though she declined to specify where. “The lawyers are not concerned about standing issues,” she said.

Other lawyers say they aren’t so sure. “Standing is dynamic and has to be present at all times and not just at the time of the lawsuit’s filing,” said Neal Katyal, a former acting solicitor general during the Obama administration who worked on an amicus brief supporting the government in the case.

The fourth plaintiff in the case, Ms. Levy, is a 64-year-old substitute teacher who will turn 65 and become eligible for Medicare in June, the month the Supreme Court is expected to rule on the case.

She said at her Richmond home Saturday that she couldn’t recall how or when she had become involved in the case and said several times that she and the other plaintiffs had been told not to talk about it. She said she had little knowledge of the case’s progress, including when it had been filed, guessing only that she had become a participant before that date. Ms. Levy’s log cabin-style home in a wooded suburban drive is about 15 minutes away by car from the federal courts where the case was initially heard.

Ms. Levy has given about $5,000 in political donations to conservative candidates in recent years, according to filings, and she helped organize a protest against the participation of openly gay members in the Boy Scouts. She said Saturday those issues had “nothing to do with the case.”

There also is a question about Ms. Levy’s income, which she projected in court papers to be $43,000 for 2014 as the basis for her expected premiums and tax credits and in turn why she claimed a legal grievance. Ms. Levy said in her declaration that she was employed as a substitute teacher, and she indicated no other sources of income.

A spokesman for Chesterfield County Public Schools, which Ms. Levy had listed as her employer in most of her recent campaign-donation filings, said her annual rate of pay was less than $10,000. A single person earning that amount wouldn’t have to pay the penalty if she went without coverage and would make too little to qualify for any tax credits.

Ms. Levy didn’t answer questions about her income on Saturday and didn’t respond to an email on Monday.

Sam Kazman, general counsel for CEI, said he wouldn’t provide further information about Ms. Levy’s sources of income. “We stand by our affidavit and there is no reason to assume that substitute teaching is her only or principal source of income,” he said.

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