Lawmaker says state suit could end tax break for 400,000

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A key House Democrat says a lawsuit filed by the attorney general challenging the Affordable Care Act could lead to 400,000 Hoosiers losing out on tax breaks meant to make the insurance more affordable.

Rep. Ed Delaney of Indianapolis, who has been active on health care policy issues in the legislature, said the suit filed Tuesday by the state and 15 school districts is “dashing the hopes of Hoosiers on purpose.”

But Delaney went beyond blaming Zoeller and put the issue square at Gov. Mike Pence’s feet.

“What he’s saying, as the governor of our people, is that he does not want federal tax dollars that have been paid to the federal government to be used to help the people of Indiana,” Delaney said. “That is incredible. That is neglectful.”

The suit accuses the Internal Revenue Service of going beyond the Affordable Care Act’s authorizations by extending the tax breaks – which are meant to be subsidies – to residents of all states. The suit said the law only authorizes the tax credits for people living in states that are operating state-based exchanges, which are essentially marketplaces for insurance.

Indiana and most other states opted not to create their own exchanges and let the federal government do the job instead.

That’s important because the health care law – also known as Obamacare – requires companies to pay penalties if they fail to provide minimum health coverage to employees and at least one of those employees signs up through an exchange and receives the federal subsidy.

Under the law as written, no Indiana company could be subject to the penalty because the state doesn’t have an exchange and, therefore, employees couldn’t qualify for a subsidy, according to the lawsuit.

But as revised by the IRS, the health care program opens the subsidies to residents of all states – including Indiana – which also makes companies in the state subject to the penalties.

That affects private firms and not-for-profit organizations but also government entities, Zoeller said. And Congress doesn’t have the authority to impose taxes or tax penalties on state or local governments, Zoeller said.

But Delaney said that for the state’s argument to have merit, it would mean stripping the tax breaks away from all Hoosiers.

He said the U.S. Supreme Court has already upheld the Affordable Care Act as constitutional in a case in which the state was a plaintiff and that the new challenge is frivolous.

“Mr. Zoeller lost this argument in the Supreme Court,” Delaney said. “He’s asking for a do-over, a video replay.”

The U.S. Supreme Court upheld the Affordable Care Act’s mandate that individuals purchase insurance and most other aspects of the law. But the court did rule that Congress couldn’t force states to expand Medicaid.

Zoeller said that decision, combined with rules President Barack Obama’s administration has made since then, mean there are still issues for the court to consider.


  • Vote Against Themselves Eh?
    Hey Susan, please elaborate on what you mean by the poverty stricken Hoosiers voting against themselves....you mean they are voting against themselves because they don't vote for Democrats that would dole out money and subsidies to them? Are you saying that these people could actually vote themselves money from the government coffers if they voted for Democrats? If you're not talking about that then I don't know how you could say by voting for Republicans they are voting against themselves...it's many of the Republicans (not all) that have job creating ideas and policies in mind that allow the "poverty stricken people" to better their own position instead of the government simply giving them money to make them feel better in the short term. Why is it that you believe the poor need the government to fix their situation with more money given to them? I may have assumed too much into your thoughts on this, but I feel that is more of a general issue with anyone saying that poor people voting for Republicans are voting against themselves and you hit on that with your comment so I made some assumptions. Republicans aren't always right on this either, but overall a conservative approach to government with an emphasis on the free market capitalist approach is better for society than a dependency based socialist setup that doesn't encourage personal responsibility and development. Sure, democrats WANT all of that for people too, but their method of governing doesn't mesh with actually encourating personal responsibility and development. WANTING and DOING are two different things.
  • I'm With Susan
    I'm with Susan on this issue. I am an Independent voter that could never vote for Mike Pence and the legislators that support his agenda. I think too many truly moderate citizens have bought the message coming from the far right. In Indiana, a moderate is considered a liberal. It is a sorry situation that begs for mainstream citizens to give more critical thought to the direction the state is heading. We are looking more like Mississippi, Arkansas, and old Kentucky every day.
  • 400000 demo voters
    And that's all Ed cares about.
  • No Bible Believers Here...
    The Koch brothers are driving TP strategy, not the Bible. The Bible says, "Love thy Neighbor as You Love Yourself" and there is no love going on because too many concerned about their own household. One thing is for sure, we may be closer to the "last days" than we think.
  • Delaney is Wrong
    I'm not a fan of Ed Delaney or his wife. I'm sure if his wife's law firm was representing the school districts he wouldn't be playing politics with this issue. Delaney is wrong on the fact that the ACA has been upheld. The original version of the law was upheld; however as the article notes, the IRS changed the law after it was upheld. This opens the law up for additional challenges. The Obama administration has made several revisions to the law after it was upheld. That is why the democrats argument that the it is the law of the land is not factual. At one sad time in our country slavery was the law of the land and was upheld by the supreme court. Even so, Republicans fought to end slavery and for the freedom for all individuals.
  • Really Susan ???
    I'm a Republican because I have a functioning calculator. I do not believe in God. I do believe that man should do for man. Not Government. The Democrat platform is IMPOSSIBLE and spells failure. We can't all be on welfare. A tax payer voting Democrat is like a chicken voting for Colonel Sanders.
  • Pence doesn't get it
    I don't think that Mike Pence gets that he driving moderate Republicans away. I don't know if it is his religious fervor (not advertised, but drives him) or his catering to the tea party, but I predict his right wing nuttiness is going to cost him the next election. He is not even close to the middle and many moderate Republicans (this one included) find his mean-spirited policies regarding women and lower income earners hard to take. Mitch kept the moderates in the fold, Mike is not.
  • Too Many Taxes
    Hey, middle class registered democrat guy here, just wanted to say WE ARE PAYING TOO MUCH TAXES FOR WHAT WE EARN!!!
  • Tax Break Twilight Zone
    Here goes the spin again....left says republicans hate this country but yet this country IS all about the flag and bible. Left must hate us because we must truly love this country more than the left. Susan, I hope you don't imply that we are all just a bunch of dumb hicks and are incapable of making informed decisions.
  • more money for the lawyers.
    "The school districts are represented in the lawsuit by Bose McKinney & Evans, an Indianapolis law firm." How much do you think they charge an hour?
  • Twilight Zone
    We here in Indiana are a republican state surrounded by democratic states. And we are almost as radical as Texas is getting. I don't understand how all of the really poverty stricken Hoosiers always vote against themselves and vote for the Republican party. The strategy of wrapping the party up in the flag and bible has worked wonders.

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