South Carolina Attorney General Alan Wilson has joined five other states in public support of a several small business owners and taxpayers who have filed suit against the federal government’s healthcare reform as enforced by the Internal Revenue Service in states without healthcare exchanges.
The lawsuit, Halbig v. Sebelius, contends that the IRS cannot enforce a rule that would “punish” large employers with penalties in the 34 states (including South Carolina) without a state-based healthcare exchange, like South Carolina. A recent court decision sided with the federal government. According to court documents, the ruling concluded: “The IRS Rule is consistent with the text, structure, and purpose of the Affordable Care Act.”
But the plaintiffs and Wilson disagree, saying that the tax penalty funds a subsidy within states that run their own exchanges, but the Affordable Care Act did not specify that a penalty could also be enforced in those states without exchanges. The case now could be heard by a Washington, D.C., circuit court.
“You have a federal agency that has completely re-written the Affordable Care Act,” Wilson told South Carolina Radio Network. “Our job is to protect not only the law and the intent of the law but to protect the process by which that law is enforced. When you violate that process than you’ve created anarchy in our system of governance.”
The other states signing onto the amicus brief in favor of the plaintiffs include Alabama, Georgia, Nebraska, Oklahoma and West Virginia — none of which created their own healthcare exchanges. Seventeen states in the nation did create the healthcare exchanges.