States cannot be forced to set up “exchanges” under Obamacare.
As of right now, it looks like more than half of states will not set up exchanges.
States that don’t set up exchanges will have exchanges set up on their behalf by the federal government.
It seems clear the way the Obamacare law was written, only states that set up state exchanges will have access to federal subsidies for health care premiums.
Without these subsidies, the federal government cannot impose tax penalties on businesses that do not provide insurance to employees.
In other words, in more than half of states, the government will not be able to impose penalties on businesses. As a result, the whole rotten Obamacare edifice is at risk of collapsing.
To fix this problem, IRS decided to say “screw the law” and to extend ObamaCare subsidies to people enrolled in federal government-run exchanges.
Republican lawmakers are threatening to subpoena Internal Revenue Service documents over claims that the administration improperly expanded the availability of subsidies under the federal health care overhaul.
IRS representatives say the agency has been cooperative. But in a Jan. 29 letter, Reps. Darrell Issa, R-Calif., and Dave Camp, R-Mich., called for “unredacted” documents to be submitted by Feb. 5.
The Republicans claim the IRS had “no authority” to make the decision. Further, Issa says he’s asked the IRS for documents four separate times relating to how the government is crafting the law but has been ignored.
The Treasury Department, though, is defending its decision. An October 2012 letter said the government is allowed to provide subsidies to “individuals who enroll in coverage through either a state-run or a federally-facilitated exchange.” The department said nothing in the law suggests “Congress intended … to limit the availability of the tax credit.”
Another day, another battle against the socialist juggernaut that is Obamacare.