Indiana to recover $95 million after ruling in Obamacare tax lawsuit

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INDIANAPOLIS (WTHR) - Indiana is one of six states that will receive a share of $839 million after a federal court ruled on a 2015 lawsuit.

On Tuesday, a U.S. District court ordered the Internal Revenue Service to repay the plaintiffs after successfully asserting that the Affordable Care Act's tax on state Medicaid programs was unlawful.

Indiana's share of the ruling is approximately $95 million.

“The feds wrongfully took Indiana’s money to fund Obamacare,” said Attorney General Curtis Hill said. “Since the federal government cannot tax the states, we are pleased to return this illegally collected money to Hoosiers.”

Hill's office said Indiana joined the multistate lawsuit when "federal authorities threatened to withhold Medicaid funds unless state taxpayers paid a portion of the Health Insurance Providers Fee to help fund the Affordable Care Act, otherwise known as Obamacare."

Kansas, Louisiana, Nebraska, Texas and Wisconsin were the other states involved in the suit.