The Republican lawsuit targets reinsurance that helps insurance companies provide universal coverage without accounting for pre-existing conditions.
Dec. 04-- While creative at points, Oklahoma Attorney General Scott Pruitt's legal challenge to the Affordable Care Act -- Obamacare -- is speculative, conjectural and fails to meet the test of law, attorneys for the federal government say.
In a Monday filing, the federal attorneys ask U.S. Eastern District Judge Ronald White to dismiss Pruitt's complaint against U.S. Health and Human Services Secretary Kathleen Sebelius, which would allow the federal health care law to go into effect as scheduled.
The state lacks any legal standing to make its key claim that the law's tax penalties against employers who fail to provide adequate health insurance to their workers can't be enforced in Oklahoma, federal attorneys argue in their filing at the Muskogee-based court.
Pruitt's claim rests on the fact that Oklahoma won't be establishing a state health insurance exchange, and the law doesn't allow for the tax penalties to flow through a federal exchange to be built in the state as a substitute.
But the U.S. Justice Department attorneys argue that Oklahoma can't make its claim because it doesn't stand to be damaged by the law's tax penalties.
"Oklahoma can provide no more than conjecture and speculation that it will be subject to that penalty, which applies only if a large employer fails to provide coverage to its full-time employees that meets certain minimum standards," the filing says.
Pruitt doesn't make any claims about the insurance provided to state government employees, but the federal response says those benefits are "relatively generous" and it is unlikely the state would be subject to any penalties under the law.
While the federal response rejects the idea that the tax penalties can't come through a federal exchange, the crux of the argument is that the claim could only be made by a employer who is subjected to the tax, and then only after they have received and paid a tax bill, which wouldn't come until 2014.
"...(A)ny claim for relief from the large employer tax penalty belongs to the employer itself, not the state," the filing says.
While Pruitt's case argued that treating a federal exchange like a state exchange commandeers the state's constitutional authority, the federal filing says that position is logically and legally flawed.
"Oklahoma does not explain ... how a provision of federal law directing the federal government to act constitutes commandeering of the state's legislative powers," the filing says.
The legal memo points out that Pruitt's action seeks to deny some 381,500 uninsured Oklahomans with federal subsidies to help them purchase private insurance. The average subsidy would be more than $5,000 per person per year, the filing says.
"In this case, Oklahoma asserts a position that is directly adverse to the approximately 381,500 Oklahoma residents who will receive a premium tax credit under the act, but who would not if Oklahoma were to prevail in this suit," the filing says.
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