Oklahoma Challenges IRS Rule on Tax Credits in Federal Exchanges

Oklahoma Attorney General E. Scott Pruitt today filed an amended complaint in the state’s lawsuit against the Patient Protection and Affordable Care Act that, among other things, challenges the legality of an IRS rule that would authorize tax credits for the purchase of health insurance in federally run exchanges, and thereby expose Oklahoma employers to penalties should they fail to comply with the law’s employer mandate. Here’s AG Pruitt’s press release and an early news report. For background on the issues in this suit, see here.

In related news, Hobby Lobby filed suit against the so-called contraception mandate last week. With this filing, there are now over two-dozen suits pending against the requirement that employers include coverage for government-approved methods of contraception in health insurance plans offered to their employees. Whatever the outcome of the direct challenges to this policy, should Oklahoma’s claim that the IRS rule is illegal prevail, the contraception mandate would be unenforceable against employers in states without state-run exchanges. For this reason, I would not be surprised if some of the plaintiffs challenging the contraception mandate opt to challenge the IRS rule as well.

UPDATE: Oklahoma’s amended complaint is here.