WASHINGTON (Reuters) - An appeals court ruled Friday that President Barack Obama's healthcare law requiring Americans to buy healthcare insurance or face a penalty was unconstitutional, a blow to the White House.
The Appeals Court for the 11th Circuit, based in Atlanta, found that Congress exceeded its authority by requiring Americans to buy coverage, but also ruled that the rest of the wide-ranging law could remain in effect.
The legality of the so-called individual mandate, a cornerstone of the 2010 healthcare law, is widely expected to be decided by the Supreme Court. The Obama administration has defended the provision as constitutional.
The case stems from a challenge by 26 U.S. states which had argued the individual mandate, set to go into effect in 2014, was unconstitutional because Congress could not force Americans to buy health insurance or face the prospect of a penalty.
"This economic mandate represents a wholly novel and potentially unbounded assertion of congressional authority: the ability to compel Americans to purchase an expensive health insurance product they have elected not to buy, and to make them re-purchase that insurance product every month for their entire lives," a divided three-judge panel said.
Obama and his administration had pressed for the law to help halt the steep increases in healthcare costs and expand insurance coverage to the more than 30 million Americans who are without it.
It argued that the requirement was legal under the Commerce Clause of the Constitution. One of the three judges of the appeals court panel, Stanley Marcus, agreed with the administration in dissenting from the majority opinion.
The majority "has ignored the undeniable fact that Congress' commerce power has grown exponentially over the past two centuries and is now generally accepted as having afforded Congress the authority to create rules regulating large areas of our national economy," Marcus wrote.
Many other provisions of the healthcare law are already being implemented.
The decision contrasts with one by the U.S. Appeals Court for the 6th Circuit, based in Cincinnati, which had upheld the individual mandate as constitutional. That case has already been appealed to the Supreme Court.
The Court of Appeals for the 4th Circuit, based in Richmond, has yet to rule on a separate challenge by the state of Virginia.
(Reporting by Jeremy Pelofsky and James Vicini; Editing by Eric Beech)
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