Oklahoma Attorney General Scott Pruitt’s year-old lawsuit to bring down the Patient Protection and Affordable Care Act is beginning to receive more attention now that Obamacare has endured the first week of its square-wheeled rollout.
Taking a different approach than that employed by the 28 States that lost a Constitutional argument before the Supreme Court, Oklahoma is arguing that the law stands against itself by following separate tracks for those States which create their own insurance exchanges (and agree to fund the attendant expansion of Medicaid), and those States that have Federally-managed exchanges imposed because they refused to participate in implementing the law (or the Medicaid expansion).
The Act specifies that only low-income residents in States that have agreed to expand Medicaid and institute their own health care exchange programs are eligible to receive the promised insurance premium subsidies. Residents of States that don’t participate in Obamacare, by contrast, are not eligible to receive those subsidies – even if they buy Obamacare insurance plans through the Federal exchange program.
Merrill Matthews at Forbes explained back in July how Oklahoma is arguing that dichotomy knocks part of the Obamacare law out of step with its own requirements:
The liberals writing the law assumed the vast majority of states would create their own exchange. But just to make sure, they included a “carrot” that clearly says that the federal subsidies are available ONLY in the state-created exchanges, not in the federal-state partnerships or the federally created exchanges.
However, 34 states have decided not to play the ObamaCare game and opted for a federally created exchange or the partnership, which means the federal subsidies will not be available to millions of middle- and lower-income workers in those states.
And without the subsidies, insurance would become “unaffordable” under ObamaCare for the vast majority of those families. They would thus be exempted from the mandate to have coverage, and their employers would be exempted from the penalty for not providing it.
In other words, the most draconian part of ObamaCare would essentially be defunded. Bingo!
Oklahoma is suing the feds to establish this point.
There are other aspects to the lawsuit, involving the IRS’ punitive enforcement measures against large employers, which National Review has nicely summarized.
A Federal judge overruled the government’s contention that Pruitt lacked standing to proceed with the suit in August.
Will Oklahoma continue to fight this battle alone?