Obamacare is a top-down, authoritarian law that has already spawned untold confusion, astronomical costs, and widespread dysfunction.  Still, in an attempt to confer an air of finality to the whole mess and deter the law’s opponents from attempting to repeal or replace it, Obamacare supporters are vested in the narrative that it is “settled.”  However, it is far from settled legally and its authority is being threatened by several lawsuits rising from below, the states.

For the first time in our nation’s history, the federal government has been given the power to force an individual to purchase a product.  It also forces employers with more than 50 employees to provide health insurance and dictates the scope of the insurance the businesses must provide.  These two mandates have generated all sorts of nefarious consequences.

No doubt many readers have heard of one of the recent court challenges to Obamacare, Sebelius v. Hobby Lobby Stores, Inc.  The Supreme Court decided on November 26 to take up the case and the lawsuit will be argued and decided before June, 2014.  The Becket Fund for Religious Liberty, a non-profit, public-interest group, whose mission is to protect free expression of all faiths, describes the legal challenge as a “landmark case addressing the Constitutionality guaranteed rights of business owners to operate their family companies without violating their deeply held religious convictions.”

The Hobby Lobby, a private, family-owned business based in Oklahoma City, has garnered a lot of attention since it is first up in the docket.  The owners, the Green Family, started a small business in their garage that has grown to over 550 arts and crafts stores across the nation.  They are practicing and evangelical Christians opposed who, though not opposed to all contraception, are opposed to contraception that prevents a fertilized egg from implanting in the womb.   The founder and CEO of Hobby Lobby, David Green, put it this way:

“My family and I are encouraged that the U.S. Supreme Court has agreed to decide our case. This legal challenge has always remained about one thing and one thing only: The right of our business to live out our sincere and deeply held religious convictions as guaranteed by the law and the Constitution.  Business owners should not have to choose between violating their faith and violating the law.”

It should be noted that the Hobby Lobby has no moral objection to providing 16 of 20 FDA-approved contraceptives required under the Obamacare mandate and do so at no additional cost to employees under their self-insured health plan. 

In a similar vein, Notre Dame filed, for the second time, a lawsuit that challenges Obamacare arguing that the government has no constitutional right to force them to go against their religious teachings and provide free birth control.

Certainly the decision in Sebelius v. Hobby Lobby Stores, Inc. (as well as the one in Notre Dame’s challenge should the case reach the Supreme Court) will be significant with long-lasting repercussions for all of us.

Other lawsuits that challenge Obamacare are equally important.  Halbig v. Sebelius was argued on Tuesday, Dec. 3, before Judge Paul L. Friedman in the U.S. District Court for Washington, D.C.  This lawsuit, along with three others that are similar, challenge the legality of the IRS expanding Obamacare’s subsidies and penalties beyond what was authorized in the Affordable Care Act.  Plaintiffs in these cases (one in Virginia and one in Oklahoma) argue that the law only allows federal subsidies to be granted “through an exchange established by the state” and not through the federal exchanges.  As you may recall, only 16 states and the District of Columbia chose to set up state-run exchanges.

In Halbig v. Sebelius, a group of small businessmen and individuals are suing the federal government over the IRS regulation that will burden their business, force them to pay fines, and reduce their number of employees.  According to Sally Pipes, who covers healthcare policy for the Pacific Research Institute, one of the plaintiffs in the Halbig case, David Klemencic, “a West Virginia man who does flooring work, argues that under the Affordable Care Act, he is exempt from the individual mandate because of his low income.  But if the federally operated exchange is authorized to hand out subsidies in his state, he'll no longer be eligible for the exemption. He'll either have to buy an insurance plan on the exchange or pay the fine for refusing to comply with the mandate. In both instances, his wallet would be lighter than if he were allowed to simply go without insurance.”

King v. Sebelius is winding its way through the Virginia court system.  That case also argues that the federal government does not have the authority to offer subsidies in the federally-run exchange.  The subsidies were offered as an incentive only to the states to encourage them to set up an exchange.  When 36 states decided not to, the federal government stepped in and created the federal exchange for those respective states.

On Monday, Oklahoma’s AG, Scott Pruitt, wrote of his state’s lawsuit in a Wall Street Journal op-ed that “The Sooner state and several others are trying to stop the government from imposing tax penalties on certain states, businesses and individuals in defiance of the law.  If these legal challenges are successful, the deficit spending associated with the new health-care law could be reduced by approximately $700 billion over the next decade.

The fourth case is in Indiana, where Attorney General Greg Zoeller and 39 school districts are arguing that the employer mandate only applies to states that created their own exchange, not the federal exchange.  They further argue that local and state governments cannot be penalized for not complying with the employer mandate.

The New York Times reports that “The subsidy lawsuits grow out of three years of work by conservative and libertarian theorists at Washington-based research organizations like the Cato Institute, the American Enterprise Institute and the Competitive Enterprise Institute. The cases are part of a continuing, multifaceted legal assault on the Affordable Care Act that began with the Supreme Court challenge to the law and shows no signs of abating.”

As AG Pruitt stated in his Wall Street Journal op ed, “While the president's health law is vast and extraordinarily complex, it is in one respect very simple. Subsidies are only to be made available, and tax penalties for not signing up for health insurance are only to be assessed, in states that create their own health-care exchange. The IRS, however, is attempting to enforce tax penalties in all states – including Oklahoma and the majority of the other states that have declined to create their own exchanges. Citizens and businesses in these states must use the federal exchange instead.

“The distinction is critical, because under the terms of the law it is the availability of government insurance-premium subsidies that triggers the penalties against businesses if they fail to provide their employees with health insurance that the administration deems acceptable. This is a huge problem for the administration, which desperately needs to hand out tax credits and subsidies to the citizenry to quash the swelling backlash against the law.”

If these plaintiffs succeed, much of Obamacare would unravel.