Bench Memos

Re: Obamacare Litigation Update

Stretching the limits of government power has been a hallmark of the Obamacare enterprise — first the law itself and now its implementation. The latest case challenging the president’s attempt to govern by executive fiat, Halbig v. Sebelius, will move forward thanks to a ruling today. The suit is brought by employers who are being forced to pay penalties and cut their employees’ hours because federal regulations are extending the employer mandate and some aspects of the individual mandate to states that have not set up their own insurance exchanges. These regulations are at odds with the text of the law, which only applies these provisions to states with exchanges.

While the court did not issue a preliminary injunction to block the subsidies and penalty, it will decide the case in an expedited fashion, possibly even before consumers have to decide to buy insurance or pay the penalty.

After the ruling Sam Kazman, the general counsel for the Competitive Enterprise Institute, which is helping coordinate the case, said, “We have been hoping for a quick ruling since we filed this case, and now it looks like we will get it. . . . We are hopeful the forthcoming ruling will invalidate the attempt by the IRS to eliminate the distinction between states that participate in the insurance exchange program and those that do not.”

While this case does not have the potential to undermine the entirety of the law like the original NFIB case, it is a serious challenge to this administration’s attempt to use executive and regulatory power to get around the laws passed by Congress that will have implications for the president’s choice to unilaterally delay the employer mandate as well.

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