1. Reconciliation: The Dems passed ObamaCare on reconciliation with 51 votes in the U.S. Senate. What the Dems pass on reconciliation, the Republicans can repeal on reconciliation. As the Chief Justice flip-flop proved, the U.S. Supreme Court will not lift a finger if every rule of the Senate or House procedure is shredded to pass a bill into law. Now, since the rules of the U.S. Senate run on precedent, these are the rules.
2. No State exchange equals no tax credit equals no dumping of employees off employer benefits: Or, if a State government refuses to set up an exchange, because ObamaCare provides no mechanism for the Federal government to fund it, then since it cannot exist in those states — there can be no tax credit for individuals to purchase insurance.
Then, employers attempting to “comply” with the ObamaCare mandate for health coverage will find themselves unable to dump their employees into the exchange, because there is no exchange.
Oh. That. Yes, no exchange equals no tax credit, and therefore, no coverage for employees dumped by their employers. Therefore, the employers cannot comply with the law by dumping their employees into the non-existent exchanges.
Ultimately, therefore, employers in states without Exchanges will either have to move their business or comply with the mandate by providing their employees with health insurance or, alternatively, simply may not have to comply with the mandate in exchange free states.
The foregoing describes the legal case making it’s way up the legal ladder.
Here is a further summary and explanation from a liberal’s point of view, from the first linked article, which is from The New Republic:
“…the law doesn’t permit the federal government, through those exchanges, to administer the subsidies and tax credits that are currently required of the states. And if the creation of federally-run exchanges would make it illegal to provide any subsidies at all, they argue that it would also be illegal for the government to penalize employers who refuse to provide adequate health benefits in those states.
[Michael] Cannon [of CATO] and [Jonathan] Adler [of Case Western Reserve University] explain their admittedly complex argument in a recent Op-Ed:
The Act’s “employer mandate” taxes employers up to $3,000 per employee if they fail to offer required health benefits. But that tax kicks in only if their employees receive tax credits or subsidies to purchase a health plan through a state-run insurance “exchange.”
This 2,000-page law is complex. But in one respect the statute is clear: Credits are available only in states that create an exchange themselves. The federal government might create exchanges in states that decline, but it cannot offer credits through its own exchanges. And where there can be no credits, there is nothing to trigger that $3,000 tax.
So, if their argument stands, those states that refuse to implement exchanges could effectively subvert huge portions of the law: Not only would many low-income residents of those states not be able to afford insurance, but employers would be free of the mandate to cover their employees.”
It is a classic case of yes, but, however which could cause further Supreme Court rulings and more uncertainty.