Obamacare faces new challenges in legislatures and courts

January 25, 2013

HealthcareThe legal controversy over Obamacare continues—not just in the courts, but now in state legislatures. In court, for example, familiar challenges are moving forward in the Fourth Circuit.  And now a Texas state senator has introduced legislation that would give businesses tax breaks if they refuse to comply with the Obamacare mandate requiring employers to provide health plans that include contraception coverage.

The federal government can fine businesses $100 per day, per employee, if they refuse to comply with the contraception mandate, and the proposed Texas tax break is designed to offset those fines, thereby undercutting the federal government’s ability to enforce the federal law.

The Texas state senator says he introduced the bill to protect businesses from what he considers to be an unconstitutional infringement on religious liberty.

The contraception mandate could make its way to the Supreme Court relatively soon, given that a circuit split is already developing over its constitutionality. The Tenth Circuit has held that the free exercise rights under the First Amendment apply only to individuals and not to their businesses—meaning a business cannot refuse the contraception mandate on religious grounds. (See Hobby Lobby Stores v. Sebelius, case no. 12-6294.) But the Seventh Circuit granted a temporary restraining order exempting a business from the mandate, when its panel decided 2-1 that the business had a reasonable shot at winning its claim that the First Amendment applies and the mandate is unconstitutional. (See Korte v. Sebelius, case no. 12-cv-01072.)