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U.S. senator sues over healthcare subsidy for Congress

By Susan Cornwell and Doina Chiacu

WASHINGTON (Reuters) - U.S. Senator Ron Johnson filed a lawsuit on Monday challenging the way President Barack Obama's healthcare law is being applied to Congress, part of a larger Republican strategy to draw attention to what they see as critical flaws in Obama's signature domestic policy.

Johnson, of Wisconsin, is challenging a U.S. agency decision allowing the federal government to keep paying part of the costs of health insurance for U.S. lawmakers and their staffs who must buy coverage through the Obamacare marketplaces.

He said the decision singled them out for "special treatment" that other Americans don't get.

The senator's lawsuit was the first salvo fired at Obamacare from Capitol Hill as lawmakers returned to work after a recess.

More blasts are coming; the House of Representatives Republican leadership is planning votes later this week aimed at the security and transparency of the federal government's health insurance website, HealthCare.gov.

The Affordable Care Act, passed in 2010 and commonly known as Obamacare, mandated that Americans have health insurance or pay a penalty, while offering subsidies to help lower-income people buy it. The law created new online marketplaces where Americans can shop for and buy insurance, with the goal of signing up millions of uninsured and underinsured people.

Signups for 2014 insurance coverage began October 1. But HealthCare.gov was glitch-ridden for much of the first two months of operation, bolstering the criticisms of Republicans who have long opposed the ambitious reach and mandates of the new law.

More than 2 million people have signed up for new private health plans that took effect on January 1, and people have since been able to use their new Obamacare coverage.

But Johnson's lawsuit and the upcoming House votes show the Republicans plan a steady stream of Obamacare criticisms in an election year in which they hope to gain seats in both houses of Congress and perhaps take control of the Democratic-run Senate.

Johnson's lawsuit was filed in the U.S. District Court for the Eastern District of Wisconsin, but he held his news conference announcing it in a Capitol meeting room.

He said the Obama administration exceeded its legal authority when the Office of Personnel Management ruled last year that the government could continue to make employer contributions to the health insurance plans of 535 U.S. lawmakers and their staff - even when they purchase coverage through the new Obamacare online exchanges.

Johnson said this violated the intent of Congress, which was that Congress would participate in the healthcare exchanges on the same terms as other Americans.

"I think it's just a basic issue of fairness," he said. "I really do believe the American people expect, and they have every right to expect, that members of Congress, the political class here in Washington, should be fully subject to all the rules, all the laws that Congress imposes on the rest of America."

Johnson said that he had refused the employer contribution for himself and had purchased private healthcare coverage through a broker in his home state of Wisconsin. He did not know how many lawmakers had done the same.

"I imagine all my staff members, I think most people here in Congress and staff did take the employer contribution," he said.

CHALLENGES TO OBAMACARE

The Affordable Care Act has spawned many lawsuits, including one recently from a group of Roman Catholic nuns over the part of the law requiring employers to provide insurance policies covering contraception.

Turning back another legal challenge to Obamacare, U.S. Chief Justice John Roberts on Monday denied an emergency request by two physician groups seeking to temporarily block a regulation requiring doctors to register with the U.S. government in order to refer patients for Medicare-covered services.

The regulation, part of Obamacare, was set to take effect on Monday. Medicare is the government health insurance program for the elderly and disabled.

Not all Republicans think Johnson's lawsuit is a good move. Another Wisconsin Republican, U.S. Representative James Sensenbrenner, said that Johnson's lawsuit was "an unfortunate political stunt" that would have the effect of driving away good staff from Congress if it succeeds in court.

"The employer contribution he's attacking is nothing more than a standard benefit that most private and all federal employees receive - including the president," Sensenbrenner said in a statement.

The House was expected to vote on Friday on two bills related to the Affordable Care Act. One would require consumers be notified within two days of any breaches of their privacy on HealthCare.gov, which collects personal data such as names, birth dates, and email addresses.

Some technology experts have warned that the site has security flaws, but the Centers for Medicare and Medicaid Services, which oversaw the launch of HealthCare.gov, says there have been no successful security attacks on the site.

The other bill would require the government to make weekly reports to Congress and the public about how many visits to the website have taken place as well as how many people have enrolled for coverage, and to list ongoing problems with the website's functionality.

(Additional reporting by Terry Baynes in New York; Writing by Doina Chiacu; Editing by Karey Van Hall, Bill Trott, Chizu Nomiyama and Jonathan Oatis)

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