President Barack Obama signs the Health Care and Education Reconciliation Act of 2010 in a ceremony at Northern Virginia Community College in Alexandria, VA., Tuesday, March 30, 2010.

KOMO News

A Federal Judge said Tuesday he will likely dismiss only parts of a lawsuit by 20 states, including Washington, challenging the Obama administration's health care overhaul as unconstitutional, though he didn't specifically say what portions.

The Obama administration had asked U.S. District Judge Roger Vinson to dismiss the entire lawsuit. The states and the administration disagree over whether people should be required to have health insurance, and whether states should pay additional Medicaid costs not covered by the federal government.

The judge said he will issue a ruling by Oct. 14. The lawsuit is likely to wind up before the U.S. Supreme Court.

Washington State Attorney General Rob McKenna joined the lawsuit earlier this year, prompting harsh criticism from Gov. Chris Gregoire.

"She believes it's a policy matter. That's fine. This lawsuit is not about policy. It's about the Constitution," McKenna said on Tuesday. "Neither the governor nor the majority leaders of the House of Representatives or the Senate ever speak to the constitutional questions."

McKenna said he is still waiting to see which parts of the lawsuit Vinson may dismiss.

"He didn't really tip his hand with regard to which parts he'll dismiss and which parts will continue," McKenna said. "It's conceivable he'll dismiss parts of the case as to some plaintiffs and not to others."

If Vinson upholds the states' challenge, he would overturn decades of law enforcing the federal government's power to regulate interstate commerce, said Ian Heath Gershengorn, deputy assistant attorney general.

"This court is free to disagree with Congress' policy judgments but it is not free to overturn 75 years of Constitutional law," he said.

Administration attorneys also argued that the section requiring health insurance doesn't take effect until 2015 and it's up to an individual taxpayer - not the states - to challenge the law then.

But David Rifkin, an attorney representing the states, argued the law will destroy the state's Constitutional sovereignty by burdening them with uncontrolled Medicaid costs. The federal government is over reaching its taxing authority by penalizing people for not taking an action - not purchasing health insurance, he said.

"By imposing a mandate on inactive individuals they are eviscerating state sovereignty," he said.

The judge questioned whether the administration was correct in arguing that all Americans are active participants in the health care system regardless of whether they choose to have health insurance and are therefore subject to penalties under the government's authority to regulate commerce.

Health insurance is the mechanism to regulate the health care market, Gershengorn said.

"The healthiest individual can be hit by a bus. He cannot keep himself out of the health care market," Gershengorn said.

But Rifkin likened the health care law to the subprime mortgage crisis.

"If this cost shifting is allowed then it would let the government demand that people buy a prescribed package of mortgages," he said.

Florida's Republican Attorney General Bill McCollum filed the lawsuit just minutes after President Barack Obama signed the 10-year, $938 billion health care bill into law last March. He chose a court in Pensacola, one of Florida's most conservative cities. A similar case is unfolding in Virginia.

There, the Obama administration also tried to get the lawsuit dismissed, saying Virginia lacked standing to sue, but a federal judge has allowed it to continue, ruling that the overhaul raises complex constitutional issues.

The other states that are suing are Alabama, Alaska, Arizona, Colorado, Georgia, Indiana, Idaho, Louisiana, Michigan, Mississippi, Nebraska, Nevada, North Dakota, Pennsylvania, South Carolina, South Dakota, Texas and Utah.