Oklahoma Attorney General Scott Pruitt told a congressional panel Wednesday that "rogue agencies" including the IRS are misinterpreting the Affordable Care Act and that his lawsuit against the federal government aims to protect Oklahoma businesses and workers.
"This is a critical issue for Oklahoma and for every one of the 34 states that decided not to create an exchange," Pruitt said during testimony before the U.S. House Subcommittee on Energy Policy, Health Care and Entitlements, whose chairman is Rep. James Lankford, R-Okla.
Democrats on the committee noted that the hearing was held during the same week the House was expected to vote for the 40th time to repeal the law. They said Congress should not interfere with ongoing litigation over the law.
Pruitt said the law gave states a choice of creating a state-based health insurance exchange or allowing the federal government to create one. The exchanges are websites where consumers can compare prices for health insurance coverage.
Open enrollment through the exchanges is scheduled to begin Oct. 1. Oklahoma is one of 34 states that opted not to create an exchange.
Pruitt said the law is clear that states with federally created insurance exchanges would not be eligible for subsidies but also would avoid penalties for large employers that do not provide insurance.
He said Gov. Mary Fallin and other state leaders "thoughtfully and thoroughly reviewed" the options and elected not to create a state exchange.
"But after the decision was made, the IRS finalized a rule that would strip states of the main benefit of their choice - no large-employer penalty. ... The IRS is acting as a super-legislative body in this capacity by enacting regulations that Congress did not authorize."
A member of the congressional panel, Rep. Jackie Speier, said the law has reduced insurance rates in several states and provided benefits including coverage for thousands of young adults.
"The law is working, and maybe that is what the opponents are afraid of," said Speier, D-Calif.
"If Mr. Pruitt's lawsuit were to prevail, all he would achieve is making health care unaffordable to over 300,000 Oklahomans. ... The reality of a legal victory is a terrible loss for the low-income people of Oklahoma, whose taxes pay the attorney general's salary."
Pruitt argued that the IRS chose to interpret the law in a way Congress did not intend by including states with federally created exchanges in its enforcement scheme.
Pruitt filed suit against the federal government in 2011 in Muskogee-based U.S. District Court for the Eastern District of Oklahoma two weeks after he took office. In the same election, voters approved State Question 756, rewriting the state Constitution to prohibit enforcement of health-system mandates in the state.
Oklahoma's case initially challenged the federal health-care law by arguing that its individual mandate to buy insurance was unconstitutional. That argument - made by other states in lawsuits - was rejected by the U.S. Supreme Court last year in a ruling upholding most of the law's provisions.
Pruitt revived his litigation, arguing the law specified that federal subsidies for people purchasing health insurance could only be distributed to them through state health-insurance exchanges.
"Our unique position allowed us to lead the charge against rogue agencies misusing the law to advance their own agenda," Pruitt told the congressional panel Wednesday.
He said the law "cripples businesses with onerous requirements and penalties."
If a business with 50 or more employees fails to provide insurance, the business could be penalized up to $2,000 per employee, according to Pruitt's written comments.
Democrats on the panel criticized Pruitt and other opponents of the law, saying the Affordable Care Act has been approved by Congress and upheld by the Supreme Court.
Speier referred to recent comments by U.S. Sen. Tom Coburn, R-Okla., about his party's efforts to roll back the law.
"Senator Coburn said that 'the worst thing is being dishonest with your base about what you can accomplish. ... It's a terribly dangerous and not successful strategy,' " Speier said.
Rep. Jim Jordan, R-Ohio, said the IRS lacks the authority to enforce penalties against states such as Oklahoma that refuse to create exchanges. Ohio is among the states that have refused to create an exchange.
"Kids in grade school know that the Legislature writes the law and the executive branch carries it out as written," Jordan said.
In written comments provided to the committee, federal officials rebutted those arguments.
"Treasury and IRS believe that the final regulations interpret the statutory language in a manner that is appropriate to its context and consistent with the purpose and structure of the statute as a whole," stated Emily McMahon, deputy assistant secretary for tax policy at the U.S. Treasury Department.
McMahon wrote that the law "is projected to provide health coverage for nearly 30 million additional Americans."
Affordable Care Act's impact on Oklahomans
The U.S. Department of Health and Human Services released the following statistics breaking down the number of Oklahomans potentially impacted by the Affordable Care Act.
Pre-existing conditions: Up to 1,578,794 Oklahomans have some type of pre-existing health condition, including 218,356 children. The law currently prohibits insurers from denying coverage to children with pre-existing conditions. In 2014, the law expands to include adults.
Young adults: Parents are now allowed to keep their adult children on their insurance policies until they turn 26. In Oklahoma, 49,000 young adults have gained coverage through this provision.
Uninsured adults: More than 90 percent, or 593,762 people, in Oklahoma who are uninsured and eligible under the law may qualify for either tax credits to purchase coverage or for expanded Medicaid coverage. However, Gov. Mary Fallin has turned down the expansion, saying the state cannot afford the cost. The federal government would fully fund the coverage for three years, beginning in 2014, phasing down to 90 percent by 2020.
Breakdown of uninsured Oklahomans eligible for coverage under the ACA:
- 488,494 have a full-time worker in the family
- 249,114 are 18-35 years old
- 369,282 are white
- 63,580 are black
- 68,717 are Latino/Hispanic
Source: U.S. Department of Health and Human Services
Ziva Branstetter 918-581-8306
ziva.branstetter@tulsaworld.com
Original Print Headline: Pruitt rips ACA on Capitol Hill
