Could Oklahoma’s New Lawsuit Strike a Fatal Blow to Obamacare?

Oklahoma Attorney General Scott Pruitt has filed a lawsuit alleging the Obama administration is violating the Patient Protection and Affordable Care Act and imposing illegal taxes in states such as Oklahoma. As Jonathan H. Adler and Michael F. Cannon detail in their forthcoming Health Matrix article, “Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits under the PPACA,” the PPACA cannot function without state buy‐​in. The Obama administration’s response to state push‐​back has been to rewrite the statute by imposing, on both employers and individuals, taxes that Congress never authorized. Pruitt is challenging the IRS rule that imposes those illegal taxes. Supporters and opponents agree the PPACA’s “entire structure” depends on the IRS’s interpretation of the statute, and that this dispute “could be a fatal blow to Obamacare.”