WASHINGTON, D.C. (Sept. 4) — The Internal Revenue Service (IRS) acted illegally when it issued an Obamacare rule allowing subsidies for health care insurance purchased in federal exchanges in states that declined to create their own exchanges, a brief filed Wednesday by the American Civil Rights Union (ACRU) argues.
The brief in King v. Burwell asks the U.S. Supreme Court to hear a challenge to a Fourth Circuit Court of Appeals ruling upholding the subsidies.
By ignoring the clear wording of the Affordable Care Act (ACA), the Obama Administration has violated Congress’s unique constitutional power to enact federal laws, the brief states. The ACRU is joined on the brief by the Pacific Research Institute, the CATO Institute, the Individual Rights Foundation and the Reason Foundation.
“When 36 states failed to establish Exchanges, [Health and Human Services] used its Section 1321 authority to establish federal Exchanges,” the brief states. “But that left taxpayers enrolling through a federal Exchange ineligible for the ‘premium assistance credit’ …. [R]ather than seek corrective legislation, the Internal Revenue Service ignored public objections … and issued a final regulation ‘deeming’ federal exchanges to be State Exchanges.”
The brief notes that, “There is no indication in the ACA that Congress delegated to the IRS the power to determine whether billions of federal subsidy dollars annually should be disbursed to those purchasing health coverage on federal Exchanges.”
As such, the lower court’s acquiescence to the IRS rule constitutes a “collusion between the court and the Executive to seize the lawmaking prerogative from Congress.”