US

Lawsuit claims Obamacare crushing small employers

The 2010 Patient Protection and Affordable Care Act radically hikes small-business costs, impoverishes states and violates the plain language of the U.S. Constitution, claims a lawsuit filed Tuesday in Houston, Texas.

Steven F. Hotze, a Katy-based allergist and immunologist, says the Affordable Care Act, popularly called Obamacare, forces his wellness center to pay enormous costs for its 73 employees. His suit challenges the law on three main grounds.

Hotze’s lawsuit claims that by forcing Americans to buy private insurance, Obamacare violates the Fifth Amendment’s Takings Clause, which holds that private property can only be taken for a “public use” and with just compensation for the property owner.

The suit also claims that the Affordable Care Act is unconstitutional because revenue-raising laws and taxes must originate in the House of Representatives. In the 5-4 decision upholding Obamacare, Chief Justice John Roberts ruled that the law’s penalty on the uninsured is a tax.

A 2012 suit filed in federal district court that was supported by the Pacific Legal Foundation similarly uses the Origination Clause in Article I, Section 7 of the Constitution to challenge the Affordable Care Act’s legality. The Justice Department has moved to dismiss that challenge, arguing that the Supreme Court “has never invalidated an act of Congress” using the clause.

Hotze also argues that Obamacare violates principles of federalism by sending a “massive redistribution of wealth away from Texas.”

Although Hotze is critical of federal intrusions, his small wellness and pharmaceutical center does not seem like a typical plaintiff in a suit against the federal government. “It’s primarily a women-run business,” he told The Daily Caller, that specializes in natural and diet remedies without extensive use of pharmaceuticals.

The problem, said Hotze, is that the Affordable Care Act is forcing his small business to choose between either exorbitant per-employee penalties or exorbitant costs for health coverage the employees don’t want.

Right now Hotze and his employees rely on health savings accounts, but Obamacare would require them to move into government-approved plans with higher premiums and fewer options.

This requirement will kick in January 1, 2014, forcing Hotze’s company, Braidwood Management, either to switch its employee plan or pay penalties of $2,000 per person for every employee over a 30-employee threshold.