AG’s Federalism Unit Files Amended Lawsuit against Affordable Care Act

New IRS rule to tax businesses conflicts with health care law

OKLAHOMA CITY – Attorney General Scott Pruitt filed an amended complaint Wednesday in Oklahoma federal court, challenging the implementation of certain provisions of the Affordable Care Act.

“Oklahoma is in a unique position with the only active lawsuit against the Affordable Care Act to hold the federal government accountable in how it implements the law,” Pruitt said. “Now that the Supreme Court has deemed the ACA a tax, and therefore constitutional, the federal government must follow the law and proper procedures, and that is not being done.”

The original lawsuit, filed in January 2011 in the U.S. District Court for the Eastern District of Oklahoma, challenged the health care act’s constitutionality under the Commerce Clause, specifically whether the federal government had the power to mandate individuals to buy health insurance as simply a condition of being a citizen. Oklahoma’s lawsuit was stayed by Judge Ronald White until the U.S. Supreme Court issued a ruling in the Florida case.

In June, the Supreme Court sided with the states, agreeing that the health care law had exceeded its power under the Commerce Clause, but the Court gave authority to implement the individual mandate as a tax under Congress’ Taxing Power.

Following the decision, General Pruitt filed a request with Judge White to lift the stay on the Oklahoma case, so new issues related to implementation of the act could be addressed. The judge granted the request last week, lifting the stay.

With Oklahoma’s lawsuit still at the district level, the state can amend the complaint, which would not be allowed with cases on appeal.

Among the issues raised in the complaint is a new IRS rule that violates the Administrative Procedures Act and conflicts with the ACA. Oklahoma also is asking the Court to recognize that because the Supreme Court deemed the health care act’s individual mandate a tax that it no longer conflicts with Oklahoma’s constitutional provision that no law or rule can “compel any person, employer or health care provider to participate in any health care system.”

For a copy of the original and amended complaints or the state’s motion to lift the stay, go online to www.oag.ok.gov.

Pruitt v. Sebelius-Motion to Lift Stay(Final).pdf

Original Complaint - Healthcare.pdf

Oklahoma Amended Complaint.pdf

Pruitt Takes Action on Oklahoma Health Care Lawsuit

Oklahoma amendment still protects Oklahomans from being forced to buy health care; Supreme Court decision, other federal actions raise new questions about constitutionality 

OKLAHOMA CITY – Attorney General Scott Pruitt Friday asked a federal judge to lift a stay on Oklahoma’s health care lawsuit and allow the state time to address the U.S. Supreme Court’s ruling on the Affordable Care Act. 

The Oklahoma lawsuit was filed on Jan. 21, 2011, in the U.S. District Court for the Eastern District of Oklahoma. It is pending before Judge Ronald White, who stayed the case while the U.S. Supreme Court decided a lawsuit filed by Florida and 25 other states. The Supreme Court decision was issued in June. 

“The Supreme Court agreed with Oklahoma’s claims that the Commerce Clause does not give the federal government power to compel Americans to buy a product. But in the process, the Court found the individual mandate to be a new tax, which now raises significant questions about its validity as a revenue-raising measure,” Pruitt said. “This is a critical issue for Oklahoma residents and businesses, so we are asking the court to lift the stay and give us 30 days to determine the next step.” 

The Attorney General’s Office is reviewing several aspects of the health care law and tax, including a new rule by the Internal Revenue Service. The rule contradicts a provision in the health care law that keeps businesses from being taxed for lack of employee insurance coverage in states like Oklahoma, where a state-run health insurance exchange has not been created. 

Attorneys, led by the Solicitor General, also are assessing the effect of the Supreme Court’s ruling on Oklahoma’s constitutional amendment (Article II, Section 37) that prohibits any government from “mandating” Oklahomans to purchase health insurance. State Question 756 – The Oklahoma Health Care Freedom Amendment – was passed in November 2010 with more than 70 percent of the vote. 

“This lawsuit has never been about health care. It is about the limits of the federal government under the spirit and letter of the Constitution, and whether they have exceeded those limits through this act,” Pruitt said. “Our duty is to defend the states’ role and provide a check for this out-of-control administration that unashamedly seeks to exceed its authority.”

Pruitt v. Sebelius-Motion to Lift Stay(Final - Version 3).pdf

U.S. Supreme Court to Hear Health Care Law Arguments Next Week

The U.S. Supreme Court is schedule to begin hearing arguments in the Patient Protection and Affordable Care Act cases on March 26, 27, and 28. 

The Court will not allow the proceedings to be televised, but is planning to provide the public with audio recordings and transcripts of the oral arguments on an expedited basis through the Court’s website.  The Court will post the audio recordings and unofficial transcripts as soon as the digital files are available. Morning session files should be available no later than 2 pm.  The recording and transcript of the March 28 afternoon session should be available no later than 4 p.m.

Links to the recordings will be available through links on the Court’s homepage, www.supremecourt.gov. 

Links to the orders and briefs as well as other pertinent documents are available on the U.S. Supreme Court resource page, http://www.supremecourt.gov/docket/PPAACA.aspx.

The arguments will be presented as follows:

Department of Health and Human Services v. Florida (11-398)
(Anti-Injunction Act)
Monday, March 26, 2012, at 10 a.m. (90 minutes for oral argument)

Department of Health and Human Services v. Florida (11-398)
(Minimum Coverage Provision)
Tuesday, March 27, 2012, at 10 a.m. (2 hours for oral argument)

National Federation of Independent Business v. Sebelius, Secretary of Health and Human Services (11-393)

Florida v. Department of Health and Human Services (11-400)
(Severability)
Wednesday, March 28, 2012, at 10 a.m. (90 minutes for oral argument)

Florida v. Department of Health and Human Services (11-400)
(Medicaid)
Wednesday, March 28, 2012, at 1 p.m. (1 hour for oral argument)

Doak Disappointed by Denial of Obamacare Waiver Request

OKLAHOMA CITY –Oklahoma Insurance Commissioner John D. Doak expressed grave disappointment Wednesday that Oklahoma’s request for a waiver on Medical Loss Ratio requirements from the U.S. Department of Health and Human Services was rejected. 

Announcement of the rejection came yesterday from Washington. 

“This decision could lead to a massive disruption of our insurance markets in Oklahoma,” Doak said in response.

The Medical Loss Ratio (MLR) in essence is a calculation of what percentage of each policyholder dollar is spent on delivering benefits or improving care, versus how much is spent on administration and profits. The Patient Protection and Affordable Care Act (PPACA) has set an 80 percent minimum MLR for companies doing business in the individual and small-group health insurance markets; an 85 percent MLR for large-group plans.

Oklahoma Insurance Department in September sought a gradual phase-in of the 80 percent ratio in the individual market only, rather than immediate and strict enforcement of those targets by the Department of Health and Human Services (HHS). No changes were requested by Oklahoma for the small-group and large-group markets.

Noting the disproportionate and potentially damaging effect of the high MLR on certain smaller companies and the possible impact in particular on Oklahoma’s rural communities, Doak requested that insurers be required to meet a 65 percent MLR for 2011, 70 percent in 2012 and 75 percent in 2013, with full compliance with the 80-percent standard for individual policies by the time the bulk of PPACA’s provisions are fully in force in 2014.

“We asked for a decision that would first and foremost do no harm to the current markets,” said Mike Rhoads, Deputy Commissioner of Life and Health Insurance at OID. “We wanted to keep coverage available, to keep all carriers large and small in our individual market.” 

Meeting MLR requirements should be easier for much larger carriers, which can spread the cost of administration over a vast base of policyholders. 

Conversely, Doak believes certain smaller companies might be forced to comply with PPACA’s MLR provisions by reductions in force that destroy Oklahoma jobs, meanwhile limiting consumers’ access to the counsel of licensed agents and decreasing the availability of customer service to policyholders. Some small companies might decide to leave the Oklahoma market altogether, surrendering progressively larger segments of the market to one or two major carriers and reducing consumer choice. 

State Leaders React Positively to Supreme Court Action On Obamacare

OKLAHOMA CITY – Oklahoma leaders reacted positively to news that the Supreme Court has agreed to hear the challenge by small businesses and 26 states to President Obama’s unconstitutional health care law during the current term. It has been reported that a decision could likely be issue by the court next June, in the middle of the presidential campaign where the national health care law will be a major issue. 

Oklahoma Governor Mary Fallin released the following statement yesterday on the U.S. Supreme Court’s decision to hear arguments on the Patient Protection and Affordable Care Act (PPACA):

“President Obama’s health care law is unconstitutional and unaffordable. Not only will it limit choice and undermine the quality of American health care, it stands to cost the state of Oklahoma about half a billion dollars in the process.

“Our citizens have already passed a constitutional amendment blocking its implementation in Oklahoma, and it’s clear that a majority of states are similarly opposed to the mandates, new taxes, and out-of-control spending proposed in the law.

“The Supreme Court should strike down the president’s health care reform as unconstitutional as soon as possible. The uncertainty surrounding the future of PPACA is frustrating to those who believe it stands as an obvious affront to constitutional principles, and a hindrance to crafting serious budget and health care policy on both the state and federal levels.”

Senate President Pro Tempore Brian Bingman, R-Sapulpa, released the following statement Monday:

“Oklahomans know President Obama overreached when he forced his unconstitutional government healthcare takeover through Congress. That’s why our state voted overwhelmingly to keep Obamacare, and its individual mandate to buy government-sanctioned health insurance, from becoming law.

“Obamacare represents a dangerous, unprecedented expansion of the federal government’s reach into our everyday lives. Worse yet, it will kill jobs and crush small businesses under the weight of unsustainable cost increases.

“It is my hope that the Supreme Court will reject President Obama’s unconstitutional health care law, just as we’ve done here in Oklahoma.”

Oklahoma Attorney General Scott Pruitt issue the following statement yesterday:

"The Supreme Court did the right thing by agreeing to decide the constitutionality of the healthcare law this session. It should be noted the Supreme Court allowed an unprecedented 5 1/2 hours for oral argument, which speaks to the importance of the issues being decided. 

“We expect the Court to decide the case before the presidential election, so the American people have an answer on the constitutionality of this overreaching legislation when they choose their next leader. 

"Requiring every citizen to purchase a product from private companies encroaches on our individual liberty. We will continue to fight the continuous attempts by this administration to hide behind the guise of change to force unnecessary and overreaching federal regulations on American families and businesses."

Oklahoma's lawsuit is pending in the Eastern District of Oklahoma.

Sen. Brecheen to seek A.G.’s opinion on funeral picketing bill after Supreme Court ruling favoring protestors

Following a U.S. Supreme Court decision upholding the free speech rights of funeral picketers, State Sen. Josh Brecheen said Wednesday he would ask for an Attorney General’s opinion on his legislation which would double the time moratorium and distance such protests can be held at Oklahoma funerals.

“I don’t believe there will be a problem. This isn’t a new idea. We’re just expanding


on the original law that was first carried by Senator Mike Mazzei several years ago,” said Brecheen, R-Coalgate. “I believe the A.G.’s opinion will show this law does not interfere with free speech, but it will give even greater protection to grieving families.”

Current law bans protestors from picketing funerals for an hour before and after the service. They’re also prohibited from picketing any closer than 500 feet of where the funeral is being held. Brecheen’s legislation, Senate Bill 406, increases the moratorium on picketing to two hours before and after a service and increases the distance to 1000 feet. The measure was approved unanimously by the full Senate on Tuesday.

The case before the Supreme Court was a lawsuit filed by a grieving father of a fallen soldier against members of the Westboro Baptist Church. The father had originally been awarded $11 million from the group for intentional infliction of emotional distress.

That amount was later reduced to $5 million, and eventually a federal appeals court threw out the award saying the Westboro Church could not be sued because of their First Amendment right of free speech. In an 8 to 1 decision, the U.S. Supreme Court agreed.

“This case really didn’t impact funeral picketing laws like we already have in Oklahoma. I believe the Attorney General will concur that this is a Constitutional proposal,” said Brecheen. “There have already been news reports that the Westboro Church intends to quadruple their funeral protests after this ruling. Since our state is just south of their Kansas headquarters, we need to do everything we can to shield grieving Oklahomans.”

Location:NW 58th St,Oklahoma City,United States