INDIANAPOLIS– Fifteen Indiana public school districts – and the state Attorney General – on Tuesday sued the federal government over mandates and penalties from the Affordable Care Act.
The suit challenges a new IRS regulation that imposes the costly "employer mandate" requirements of the Affordable Care Act onto state and local governments.
The plaintiffs are ultimately seeking a judgment in their favor, and an immediate injunction that would prevent the IRS from financially penalizing the state and its political subdivisions.
The suit contends the Affordable Care Act or ACA as passed by Congress does not allow financial penalties in states that did not create their own health insurance exchanges; and that the financial penalties – which are based on the total number of employees – cannot be applied to government employers.
"This case is about the fundamental relationship between the State and federal government. We respect the United States Supreme Court's ruling last year upholding the individual mandate to buy health insurance; but it did not address the recent IRS regulations extending the reach of the ACA's employer mandate," Indiana Attorney General Greg Zoeller said. "We contend the ACA improperly regulates sovereign states and does not authorize the IRS to do what it is doing in treating the State as a taxable entity."
The suit was filed in U.S. District Court for the Southern District of Indiana.
No northeast Indiana school district is involved. Those that joined the state as co-plaintiffs are:
•Metropolitan School District of Martinsville, Martinsville
•Perry Central CommunitySchools, Leopold
• Benton Community School Corporation, Fowler
• Community School Corporation of Eastern Hancock County, Charlottesville,
• John Glenn School Corporation, Walkerton
•Monroe-Gregg School District, Monrovia
• Mooresville Consolidated School Corporation, Mooresville
•North Lawrence Community Schools, Bedford
• Northwestern Consolidated School District of Shelby County, Fairland
•Shelbyville Central Schools, Shelbyville
• Southwest Parke Community School Corporation, Montezuma
• Vincennes Community School Corporation, Vincennes
•Madison Consolidated Schools, Madison
• South Henry School Corporation, Straughn
• Southwestern Jefferson County Consolidated School Corporation, Hanover