Hotze to File Suit Over Federal Health Reform

Updated May 7, 2013:

The U.S. Supreme Court’s ruling that penalties under the Affordable Care Act qualify as taxes has opened the door to another constitutional challenge, Dr. Steve Hotze, a Houston physician and prominent Republican donor, said at a Tuesday press conference announcing his lawsuit against the federal government. 

“What we were promised was a new health care policy and change that could be good for all Americans,” Hotze said at the state Capitol, flanked by more than a dozen Republican legislators. “Really, all it’s turned out to offer us is higher premiums, higher taxes and a government that will allow its bureaucrats to interfere with the doctor-patient relationship.”

Hotze plans to file a lawsuit in Houston district court on Tuesday to prevent enforcement of the federal Affordable Care Act in Texas. 

The lawsuit presents two constitutional challenges: First, it argues that the ACA violates the rule that requires revenue-raising bills to begin the U.S. House, because the original bill began as a tax credit bill for veterans — not a revenue-raising bill. Second, the lawsuit argues that the ACA violates the Fifth Amendment of the Constitution by essentially requiring citizens to pay money to other citizens by compelling employers to pay private insurance companies for health coverage.

Because Hotze’s business, Braidwood Management, has more than 50 employees, the law requires him to purchase employee health insurance or pay a $2,000 penalty for every full-time employee above a 30-employee threshold.

“This is going to be a huge expense. I’m grateful that Dr. Hotze is stepping forward,” state Sen. Dan Patrick, R-Houston, said at the press conference. “I think he’ll have the support of many business owners and people around the state.”

Hotze said Gov. Rick Perry, Lt. Gov. David Dewhurst and Attorney General Greg Abbott were made aware of his intention to file a lawsuit, and none objected. Dewhurst was originally scheduled to speak at the press conference but did not attend.

The state of Texas will not be involved in pursuing or paying for the lawsuit. Hotze plans to cover the costs of the suit and has established a legal defense fund for other individuals and businesses to donate to his cause.

Original story: 

Steve Hotze, a Houston-area physician and major Republican campaign donor who has built his career around alternative medicine, says he is filing suit against the federal government to try to prevent the enforcement of the Affordable Care Act in Texas. 

He'll announce the suit, to be filed against U.S. Health and Human Services Secretary Kathleen Sebelius, on Tuesday morning in a press conference hosted by Lt. Gov. David Dewhurst.

Hotze, the president of Conservative Republicans of Texas, said his suit will address "new and unconstitutional problems that stem from Obamacare." 

"It is imperative that Texas challenge this unwarranted federal overreach and ensure that Texans maintain the most innovative and economically viable health care system in the country," he wrote in a statement.  

Hotze has built a lucrative practice in suburban Houston around nontraditional therapies and treatments for allergies, thyroid problems and yeast infections. He’s best known for promoting natural progesterone replacement therapy for women, a treatment the FDA has questioned the effectiveness of. As recently as 2011, he had a daily health and wellness show on Republican Sen. Dan Patrick’s Houston radio station, KSEV.

Hotze contributed at least $60,000 personally and at least $640,000 via his PAC, Conservative Republicans of Texas, to GOP House and Senate candidates in the 2010 election cycle. In 2010, he contributed $15,000 to Dewhurst's campaign.