Obamacare has been challenged in court since Democrats in Congress passed it with no Republican support more than five years ago.
Looks like it’s going to be there for a long time to come.
A new lawsuit brought by Kansas, Texas and Louisiana challenges the law’s health-insurance provider fee on several grounds, not the least of which is the Tenth Amendment.
Other states are considering joining the case, which was filed Thursday in U.S. District Court in Wichita Falls, Texas,
Legal expert Hans von Spakovksy explained the lawsuit in a commentary.
“They argue that the fee is ‘an unconstitutional tax on the plaintiff states in violation of the Tenth Amendment of the United States Constitution and the doctrine of intergovernmental tax immunity,’” he wrote.
He noted that in America’s federalist system, the federal government “has no right to tax state governments.”
The private insurers with whom most states contract to provide services must pay the Health Insurance Providers Fee to Washington. But since the Obamacare law requires states to pay the fees, the complaint argues it amounts to a tax on states.
The complaint also argues it’s illegal for federal lawmakers to delegate regulatory authority to a private entity, noting the fees are set by the private Actuarial Standards Board.
Further, the suit claims states were not given “clear notice” of the massive costs in the Obamacare law.
And, the complaint contends, the Supreme Court already ruled the federal government cannot force the states to accept expanded Medicaid coverage as a condition of receiving any Medicaid funding.
The fees for 2014 totaled about $8 billion, but like many other variables in Obamacare, they are expected to reach $14.3 billion in just three years.
“It is important to note that this lawsuit is not over the Medicaid expansion that was part of the Obamacare law and that states like Texas refused to accept. This is about a fee that the Obama administration, through the IRS, is now imposing on states as a condition of continuing to receive federal funds for the basic Medicaid and CHIP programs,” von Spakovsky explained.
“There is no question that this is a serious lawsuit raising substantive issues against the Obamacare law and the way it has been implemented in relation to Medicaid and other federal health insurance programs.
“A win by the states could knock a substantial hole in the financing of the Obamacare program. The question now is how quickly the case will move through the courts, and how many other states will join the suit,” he said.
Texas Attorney General Ken Paxton sounded off: “This threat to cut Medicaid funding to Texans unless the state continues to pay hundreds of millions in taxes to Washington amounts to the very ‘gun to the head’ the Supreme Court warned about in earlier rulings on Obamacare.
“Not only is the federal government threatening the health care needs of millions of Texans, but it is doing so using Texans’ own money, collected from them through taxes. This represents yet another huge overstep of authority for this administration, which once again has demonstrated their willingness to circumvent the Constitution in order to achieve their policy goals.”
It’s also been argued that Obamacare, as a tax-revenue measure, was required to originate in the U.S. House. The Obamacare law came from the Senate, where Majority Leader Harry Reid simply took the number of a House bill and slapped it on the front of his Senate Obamacare package.
The U.S. Supreme Court already has reviewed Obamacare three times, first changing its “fees” to “taxes” to comply with the Constitution and later ruling that “exchanges established by the state” as written in the law actually means exchanges established by states or the federal government.
The Supreme Court also ruled that the government could not force business owners to pay for abortion-causing drugs in violation of their religious faith, although the government continues to fight for that mandate in several other cases.
Another current challenge to Obamacare alleges it violates the Fourth, Fifth and Ninth amendment provisions on privacy.
Yet another case is suing the Obama administration for making arbitrary changes in the law outside of Congress.