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Contraception Cases Close to Cert; New Lawsuits Could End Obamacare

By William Peacock, Esq. on October 23, 2013 | Last updated on March 21, 2019

After the Solicitor General filed responses to three anti-Obamacare lawsuits earlier this week, it seems as it the Court is getting closer and closer to resolving the critical mass of cases challenging the employer mandate on religious freedom grounds.

Meanwhile, even if the religious freedom lawsuits don't undermine Obamacare, two other recently-initiated lawsuits may also end up in the Supreme Court: one challenging the IRS's ability to penalize states for failure to provide health coverage, and another challenging subsidies to individuals who obtain insurance through the federal Obamacare exchange.

Everyone Wants to Know: Do Corporations Have Religious Rights?

The Supreme Court calls 'em people, even though they are closely-held business entities. But do these faux-people, also known as corporations, have religious rights based on their owners' beliefs? And if so, are those religious rights impacted by Obamacare, which requires the companies to provide health coverage that pays for contraception (including abortifacients)?

The Court has four cases seeking certiorari, including cases from the Tenth, Sixth, Third, and Fourth circuits. Circuit courts' opinions have ranged from holdings denying that corporations have religious rights, to incidental burden analysis, to corporations are people with full religious rights under the Religious Freedom Restoration Act.

According to the National Constitution Center, the Obama administration agreed with Hobby Lobby that the Supreme Court should take up that case (Hobby Lobby won, but the circuit split makes things messy for the national craft store chain), but asked the Court to delay acceptance of the similar Conestoga case from the Third Circuit until after the Hobby Lobby appeal has been decided.

Latecomers Take on the IRS

Indiana: You Can't Tax Me!

The IRS can penalize any employer, thorough a tax, who chooses not to provide coverage to employees. But, the IRS is not allowed to tax states due to intergovernmental tax immunity. Can it, therefore, constitutionally penalize the State of Indiana, or its school districts, for not complying with the employer mandate?

Indiana Attorney General Greg Zoeller, who brought the lawsuit, explained that the state brought the lawsuit because of an inability to pay health premiums, and stated, in an op-ed for the Courier-Journal, that the lawsuit "goes to the fundamental relationship between states and the federal government."

Subsidies: Faulty Keystone in Obamacare's Arch?

The Daily Mail states that this lawsuit, recently allowed to proceed by a federal judge, could "stop Obamacare in its tracks." The suit involves the subsidy provision of the Affordable Care Act, which authorizes the IRS to provide subsidies to those who purchase insurance "though an exchange established by the State."

For the 34 states that refused to set up exchanges, the federal exchange provided a marketplace for the state's citizens instead. But the statute, which clearly states "State," doesn't authorize subsidies for polices purchased through the federal website.

The IRS, however, argues that it "reasonably interpreted" the statute to authorize subsidies irregardless. Meanwhile, the employer mandate, which is at issue in the contraception lawsuits sitting on the Supreme Court justices' desks, isn't triggered unless the subsidies are provided.

No subsidies, no employer mandate, no Obamacare. Checkmate?

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