This is a MAJOR blow to President Obama’s landmark health care bill. If the “glitch” isn’t fixed, “the IRS lacks the power to dispense tax credits or spend money.” The flaw is so MAJOR it allows a future president to strike down the law by executive order. Let’s hope in 2013, America swears in a president that will rescind this unprecedented legislative power grab.

(WALL STREET JOURNAL)Even if ObamaCare survives Supreme Court scrutiny next spring, its trials will be far from over. That’s because the law has a major glitch that threatens its basic functioning. It’s so problematic, in fact, that the Obama administration is now brazenly trying to rewrite the law without involving Congress.

The law encourages states to create health-insurance exchanges, but it permits Washington to create them if states decline. So far, only 17 states have passed legislation to create an exchange.

This is where the glitch comes in: ObamaCare authorizes premium assistance in state-run exchanges (Section 1311) but not federal ones (Section 1321). In other words, states that refuse to create an exchange can block much of ObamaCare’s spending and practically force Congress to reopen the law for revisions.

The Obama administration wants to avoid that legislative debacle, so this summer it proposed an IRS rule to offer premium assistance in all exchanges “whether established under section 1311 or 1321.” On Nov. 17 the IRS will hold a public hearing on that proposal. According to a Treasury Department spokeswoman, the administration is “confident” that offering premium assistance where Congress has not authorized it “is consistent with the intent of the law and our ability to interpret and implement it.”

Such confidence is misplaced. The text of the law is perfectly clear. And without congressional authorization, the IRS lacks the power to dispense tax credits or spend money.

[...]

Under the law, employers must pay penalties when their employees receive premium assistance—a measure designed to encourage employers to keep offering coverage. Any employer whose employees receive premium assistance through a federal exchange would therefore suffer harm from the IRS rule and would have standing to challenge these illegal tax credits and outlays.

Public-interest lawyers could file suit as soon as the IRS rule becomes final and they find an employer that will be harmed. Any firm that doesn’t offer health benefits and that employs lots of full-time, low-skilled, young workers in a state that fails to create an exchange should suffice. A successful challenge would block the law’s employer mandate in that state.

In addition, under the Congressional Review Act, a simple (filibuster-proof) majority vote in each chamber of Congress could send to President Obama’s desk a resolution blocking this IRS rule. Even if Mr. Obama vetoed the resolution (taking personal responsibility for this assault on the rule of law), a future president could still rescind the rule. Quite a perilous situation in which to leave the president’s signature accomplishment.

Like the rest of the nation, the Obama administration wants a different health-care law than the one we got. But that doesn’t give it the authority to rewrite the law by fiat.

Quote via: the Wall Street Journal.