UPDATE 1-Virginia to ask top court to review US health law
* Supreme Court last granted such a request in 2002
* Virginia wants entire healthcare law scrapped
(Adds Justice Department, Congress, background)
WASHINGTON, Feb 3 (Reuters) - Virginia said on Thursday it will ask the U.S. Supreme Court to hear its challenge to President Barack Obama's healthcare overhaul, bypassing the appeals process in a rarely used move to try to speed up a definitive ruling on the year-old law.
The Obama administration opposed the move and said the case should follow the regular process, which could put off until 2012 a Supreme Court ruling on the sweeping law that aims to provide more than 30 million uninsured Americans with medical coverage and cracks down on unpopular insurance industry practices. [ID:nN01103739]
It was unclear whether the Supreme Court, which typically prefers that cases go though the appeals court first, would grant the request. The last time it agreed to such a request was in 2002 in a case on using race in university admissions.
Virginia, with a conservative Republican governor and attorney general, wants the entire law scrapped and contends a federal judge in Virginia erred in not striking down the full law which has been championed by Obama, a Democrat, and opposed by most Republicans.
The Obama administration's Justice Department has appealed the ruling as well, contending the law is constitutional.
A federal judge in Florida earlier this week struck down the entire law, ruling its requirement that Americans buy health insurance was unconstitutional. [ID:nN01141665] [ID:nN01120459]
The federal judge in Virginia in December also ruled the requirement was unconstitutional in a lawsuit brought by the state, but he declined to issue an injunction against the entire law.
Virginia Attorney General Ken Cuccinelli said the states need an immediate decision by the Supreme Court.
Because of uncertainty caused by the divergent rulings, Cuccinelli said, "We feel that it is necessary to seek resolution of this issue as quickly as possible."
Ramifications of the new law for the health sector have been widespread, affecting Aetna Inc (AET.N) , WellPoint Inc WLP.N and other health insurers as well as drugmakers, device companies and hospitals.
States, struggling to balance their books in the aftermath of the recession, face higher costs for the Medicaid health program for the poor under the law.
Polls show public opinion is mixed on the healthcare overhaul, and Republican promises during the 2010 midterm elections to repeal it helped them score huge gains and control of the U.S. House of Representatives.
Justice Department spokeswoman Tracy Schmaler said because the U.S. appeals court will hear arguments in the case in May, there is no need to take it directly to the Supreme Court.
Both the Florida and Virginia judges said Congress overstepped its authority in requiring that Americans start buying health insurance in 2014 or pay a penalty. Two other federal judges have upheld the law.
Twenty-six of the 50 states have signed onto the Florida suit. Virginia filed separately because it had passed a state statute just before the law passed last March barring the federal government from requiring its citizens to have health insurance. [ID:nN312466841]
"Virginia's suit is based on a state statute that is not applicable nationwide," said Schmaler. "The individual responsibility provision does not go into effect until 2014, so there is more than sufficient time for this case to proceed first in the court of appeals."
Since the first suit was filed within hours of Obama signing the healthcare act into law, legal scholars have said the matter will eventually reach the Supreme Court. Still, most states have started implementing the law, worried they will fall behind key deadlines if it is upheld.
"Currently, state governments and private businesses are being forced to expend enormous amounts of resources to prepare to implement a law that, in the end, may be declared unconstitutional," Cuccinelli said.
"Regardless of whether you believe the law is constitutional or not, we should all agree that a prompt resolution of this issue is in everyone's best interest," he said.
Democrats have used the effort to kill to law to try to highlight its more politically popular aspects, particularly provisions that allow young adults to stay on their parents' health insurance until age 26 and added prescription drug benefits for the elderly.
On Wednesday, Obama's fellow Democrats in the U.S. Senate blocked a Republican bid to repeal the healthcare overhaul. The Republican-led House of Representatives, in keeping a campaign vow, had voted to repeal it last month. [ID:nN02107914] (Editing by Vicki Allen)