IRS Rule Related to Employer Mandate May Be Next Challenge in Courts

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An IRS “interpretation” of the health care overhaul's provisions to offer tax credits to individuals in health insurance exchanges and enforce the employer mandate may be the next part of the law to move to the courts, analysts tell BNA. The concern is that IRS is overstepping its authority by stating in a May 23 final rule (T.D. 9590) that the tax credits and other insurance subsidies—as well as a $3,000-per-worker fine on companies that do not offer a suitable level of health insurance—apply regardless of whether a state creates its own insurance exchange or the federal government does it for them. If IRS does not have the authority to grant tax credits to individuals in federally created exchanges, there can be no penalty under the employer mandate, Case Western law professor Jonathan Adler argues.

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