                             RECOMMENDED FOR FULL-TEXT PUBLICATION
                                 Pursuant to Sixth Circuit I.O.P. 32.1(b)
                                        File Name: 17a0040p.06

                    UNITED STATES COURT OF APPEALS
                                    FOR THE SIXTH CIRCUIT



 THE STATE OF OHIO et al.,                                  ┐
                                   Plaintiffs-Appellants,   │
                                                            │
                                                            >      No. 16-3093
        v.                                                  │
                                                            │
                                                            │
 UNITED STATES OF AMERICA et al.,                           │
                              Defendants-Appellees.         │
                                                            ┘

                            Appeal from the United States District Court
                           for the Southern District of Ohio at Columbus.
                    No. 2:15-cv-00321—Algenon L. Marbley, District Judge.

                                   Argued: September 27, 2016

                               Decided and Filed: February 17, 2017

             Before: COLE, Chief Judge; DAUGHTREY and MOORE, Circuit Judges.

                                        _________________

                                            COUNSEL

ARGUED: Frederick D. Nelson, OFFICE OF THE OHIO ATTORNEY GENERAL,
Columbus, Ohio, for Appellants. Alisa B. Klein, UNITED STATES DEPARTMENT OF
JUSTICE, Washington, D.C., for Appellees. ON BRIEF: Frederick D. Nelson, Eric E.
Murphy, Peter T. Reed, OFFICE OF THE OHIO ATTORNEY GENERAL, Columbus, Ohio,
David P. Fornshell, WARREN COUNTY PROSECUTOR, Lebanon, Ohio, Stuart Kyle Duncan,
SCHAERR │ DUNCAN LLP, Washington, D.C., for Appellants. Alisa B. Klein, Mark B.
Stern, Samantha L. Chaifetz, UNITED STATES DEPARTMENT OF JUSTICE, Washington,
D.C., for Appellees. Jeffrey A. Chanay, OFFICE OF THE KANSAS ATTORNEY GENERAL,
Topeka, Kansas, for Amicus Curiae.
 No. 16-3093                    State of Ohio et al. v. United States                     Page 2


                                      _________________

                                           OPINION
                                      _________________

       KAREN NELSON MOORE, Circuit Judge. This case involves a novel challenge to the
Patient Protection and Affordable Care Act (“Affordable Care Act” or “ACA”), and presents us
with the question of whether one of the ACA’s tax provisions applies to state government
employers with the same force that it applies to private employers. Plaintiffs-Appellants the
State of Ohio and several of its political subdivisions and public universities (“Ohio” or the
“State”) filed suit against, inter alia, the United States Department of Health and Human Services
(“HHS”), alleging that the Federal Government illegally collected certain monies from the State
in order to supplement the Affordable Care Act’s Transitional Reinsurance Program
(“Program”). Arguing that the Program’s mandatory payment scheme applies only to private
employers and not to state and local government employers, Ohio sought a refund of all
payments made on its behalf and a declaration that the Program would not apply to the State in
the future. Ohio also argued that application of the Program against the State violated the Tenth
Amendment to the United States Constitution and principles of intergovernmental tax immunity.
The district court, in a thorough and reasoned opinion, granted a motion to dismiss filed by the
United States, and denied a motion for summary judgment filed by Ohio. The district court
concluded that the Program applies to state and local government employers just as it applies to
private employers, and that the Program as applied to Ohio does not violate the Tenth
Amendment. For the reasons stated below, we AFFIRM.

                                      I. BACKGROUND

       Congress enacted the Affordable Care Act in 2010 to address concerns regarding
nationwide access to affordable, quality healthcare. King v. Burwell, --U.S.--, 135 S. Ct. 2480,
2485–86 (2015) (“The Patient Protection and Affordable Care Act adopts a series of interlocking
reforms designed to expand coverage in the individual health insurance market.”). Among the
ACA’s provisions are (1) a tax credit to help individuals purchase health insurance through
public healthcare Exchanges; (2) a ban on insurers considering an individual’s health when
deciding whether to provide insurance or in setting the premium; and (3) a requirement that each
 No. 16-3093                    State of Ohio et al. v. United States                     Page 3


individual maintain insurance coverage or remit payment to the Internal Revenue Service. Id. at
2486–87. While many of the ACA’s requirements have been the subject of widespread litigation
and controversy, this case revolves around a lesser-known provision, the Transitional
Reinsurance Program.      See 42 U.S.C. § 18061.       The Program is a premium-stabilization
arrangement that aims to combat volatility in the individual market by collecting payments from
“health insurance issuers” and “group health plans” and distributing those payments over a three-
year period to health insurance issuers that cover high-risk individuals in the individual market.
See Patient Protection and Affordable Care Act; HHS Notice of Benefit and Payment Parameters
for 2014 (Final Rule), 78 Fed. Reg. 15,410, 15,411 (Mar. 11, 2013) (“The Affordable Care Act
establishes . . . a transitional reinsurance program . . . to provide payments to health insurance
issuers that cover higher-risk populations and to more evenly spread the financial risk borne by
issuers.”). Specifically, the ACA mandates that:

       (1) In general

               In establishing the Federal standards under section 18041(a) of this
               title, the Secretary, in consultation with the National Association of
               Insurance Commissioners (the “NAIC”), shall include provisions
               that enable States to establish and maintain a program under
               which—
               (A) health insurance issuers, and third party administrators on
               behalf of group health plans, are required to make payments to an
               applicable reinsurance entity for any plan year beginning in the 3-
               year period beginning January 1, 2014 (as specified in paragraph
               (3)[)], and
               (B) the applicable reinsurance entity collects payments under
               subparagraph (A) and uses amounts so collected to make
               reinsurance payments to health insurance issuers described in
               subparagraph (A) that cover high risk individuals in the individual
               market (excluding grandfathered health plans) for any plan year
               beginning in such 3-year period.

42 U.S.C. § 18061(b)(1) (footnote omitted); see also id. § 18041(a)(1)(C), (c)(1) (providing that
HHS may establish reinsurance programs for states that decline to do so). Ohio’s reinsurance
program is operated by HHS.
 No. 16-3093                    State of Ohio et al. v. United States                      Page 4


       The State of Ohio and several of its political subdivisions have paid contributions
(totaling approximately $5.4 million for benefit year 2014) to the Program under protest.
Additionally, four state universities that have joined Ohio in this suit (University of Akron,
Shawnee State University, Bowling Green State University, and Youngstown State University)
have paid nearly $765,000 to the Program. R. 13 (Am. Compl. at 9–13) (Page ID #67–71).

       Of the approximately $25 billion in revenue that is expected to be generated from the
Program, $20 billion is paid to certain health insurance providers to supplement those providers
covering high-risk individuals. 42 U.S.C. § 18061(b)(3)(B)(ii). The remaining five billion
dollars are “deposited into the general fund of the Treasury of the United States and may not be
used” for the Program. Id. §§ 18061(b)(3)(B)(iii), (iv), and (b)(4).

       The term “health insurance issuer” as it applies to the transitional reinsurance program,

       means an insurance company, insurance service, or insurance organization
       (including a health maintenance organization, as defined in paragraph (3)) which
       is licensed to engage in the business of insurance in a State and which is subject to
       State law which regulates insurance (within the meaning of section 514(b)(2) of
       the Employee Retirement Income Security Act of 1974 [29 U.S.C.A.
       § 1144(b)(2)]. Such term does not include a group health plan.

42 U.S.C.A. § 300gg-91(b)(2). The term “group health plan,”

       means an employee welfare benefit plan (as defined in section 3(1) of the
       Employee Retirement Income Security Act of 1974 [29 U.S.C.A. § 1002(1)]) to
       the extent that the plan provides medical care (as defined in paragraph (2)) and
       including items and services paid for as medical care) to employees or their
       dependents (as defined under the terms of the plan) directly or through insurance,
       reimbursement, or otherwise.

42 U.S.C.A. § 300gg-91(a)(1). The amount owed by each health insurance issuer and group
health plan is determined by multiplying enrollment count (as self-reported by each required
entity) by a previously determined contribution rate for each applicable benefit year. 45 C.F.R.
§ 153.405(a).

       On January 26, 2015, Plaintiffs (State of Ohio; Warren County, Ohio; The Ohio
Department of Administrative Services; University of Akron; Shawnee State University;
Bowling Green State University; and Youngstown State University) filed this action against the
 No. 16-3093                   State of Ohio et al. v. United States                      Page 5


United States, HHS, and the Secretary of HHS in her official capacity. R. 1 (Compl.) (Page ID
#1).   On February 13, 2015, Plaintiffs filed an Amended Complaint adding Plaintiff Ohio
Turnpike and Infrastructure Commission. R. 13. (Am. Compl.) (Page ID #58). The Amended
Complaint alleges that:

           1. The United States illegally or erroneously assessed or collected tax
              revenue from Plaintiffs;
           2. The Secretary’s interpretation of group health plans is arbitrary,
              capricious, an abuse of discretion, or otherwise not in accordance with the
              law; and
           3. Defendants collected tax revenues in violation of the Tenth Amendment to
              the United States Constitution, anti-commandeering principles, and the
              Intergovernmental Tax Immunity Doctrine.

R. 13 (Am. Compl. at 14–18) (Page ID #72–76). On March 25, 2015, the United States District
Court for the Southern District of Ohio issued a scheduling order memorializing the parties’
agreement to forgo discovery and submit the case on motions. R. 16 (Sched. Order) (Page ID
#85). Defendants filed a motion to dismiss for failure to state a claim on April 10, 2015. R. 17
(Mot. to Dismiss) (Page ID #86).      Plaintiffs filed a motion for summary judgment and a
memorandum in opposition to Defendants’ motion to dismiss on May 15, 2015. R. 18 (Mot. for
S. J. and Opp. to Mot. to Dismiss) (Page ID #114). Defendants filed a response in opposition to
the motion for summary judgment and in reply in support of their motion to dismiss on July 2,
2015. R. 21 (Def. Resp. in Opp. to Mot. for S. J. and Reply in Support of Mot. to Dismiss) (Page
ID #189). Plaintiffs filed a reply in support of their motion for summary judgment and a
memorandum in opposition to Defendants’ motion to dismiss on August 4, 2015.                R. 22
(Plaintiffs’ Reply in Support of Mot. for S. J. and in Opp. to Mot. to Dismiss) (Page ID #223).
The district court held a hearing on the motions on December 22, 2015.

       On January 5, 2016, the district court granted Defendants’ motion to dismiss for failure to
state a claim and denied Plaintiffs’ motion for summary judgment. The district court found that:
(1) Pursuant to the Administrative Procedure Act, the court had jurisdiction to review the
determination of HHS that the Transitional Reinsurance Program applies to health plans
provided on behalf of Ohio to its employees; (2) the Program applies to state and local
government employers; and (3) application of the Program to the States does not violate the
 No. 16-3093                     State of Ohio et al. v. United States                     Page 6


Tenth Amendment or the intergovernmental tax immunity doctrine. Ohio v. United States,
154 F. Supp. 3d 621 (S.D. Ohio 2016). Plaintiffs appealed. R. 26 (Notice of Appeal) (Page ID
#331).

         Ohio is not alone in claiming that the Program does not apply to the States. The States of
Kansas, Arizona, Indiana, Louisiana, Montana, Nevada, Oklahoma, South Carolina, South
Dakota, Utah, West Virginia, Wisconsin, and Wyoming have submitted an amicus brief in
support of Ohio. Amici argue, as does Ohio, that the ACA does not apply the Program to the
States under the ERISA definition of welfare benefit program or the clear statement rule; that
state tax immunity extends beyond discriminatory laws; and that the Program interferes with
state sovereignty and does not represent a traditional source of federal revenue.

                                        II. DISCUSSION

A. Standard of Review

         “We review de novo a district court’s dismissal of a suit” for failure to state a claim.
United States ex rel. Sheldon v. Kettering Health Network, 816 F.3d 399, 407 (6th Cir. 2016).
“A motion to dismiss under Fed. R. Civ. P. 12(b)(6) is designed to test the sufficiency of the
complaint. ‘The district court must construe the complaint in a light most favorable to the
plaintiff, accept all of the factual allegations as true, and determine whether the plaintiff
undoubtedly can prove no set of facts in support of his claims that would entitle him to relief.’”
Riverview Health Institute LLC v. Medical Mutual of Ohio, 601 F.3d 505, 512 (6th Cir. 2010)
(quoting Columbia Natural Res., Inc. v. Tatum, 58 F.3d 1101, 1109 (6th Cir. 1995)).

         We note at the outset that the district court’s opinion in this case was thoughtful,
evenhanded, and well-reasoned. After having conducted our own thorough and de novo review,
for the reasons stated below, we affirm the district court’s judgment in its entirety.

B. Group Health Plans and the Transitional Reinsurance Program

         The State of Ohio challenges the district court’s determination that “Congress intended
the Transitional Reinsurance Program to apply to state and local government employers in the
same manner that the program applies to private-sector employers. The text, structure, and
 No. 16-3093                    State of Ohio et al. v. United States                      Page 7


purpose of the Affordable Care Act and related statutes compel this result.” Ohio, 154 F. Supp.
3d at 633. Ohio’s objections to the application of the Transitional Reinsurance Program to the
States are both statutory and constitutional. Ohio first argues that the Program cannot apply to
the States pursuant to both the “plain statement rule” and the ERISA statute. Appellants Br. at
14. Second, Ohio suggests that application of the Program to the States is unconstitutional under
both the anti-commandeering doctrine and the intergovernmental tax immunity doctrine. Id. at
15. The United States counters that, “Plaintiffs’ reliance on clear statement principles does not
advance their position because the relevant statutory provisions clearly encompass their plans,”
Appellees Br. at 10, and “[t]heir intergovernmental tax immunity claim fails because that
immunity applies to taxes that discriminate against state or local governments . . . and the
transitional reinsurance program is nondiscriminatory,” id. (internal citation omitted).

       1. The Term “group health plan” Applies to State-Provided Health Insurance Plans

       Ohio first argues that the Transitional Reinsurance Program does not apply to the States
because the statute’s definition of “group health plans” does not encompass plans offered to state
employees. Appellants Br. at 16. Ohio is correct that Transitional Reinsurance Program statute
does not explicitly define group health plans to include states nor does it list states as being
required to remit payment under the ACA. The United States responds that “the Act expressly
adopts the Public Health Service Act’s definition of ‘group health plan’. . . [which] clearly
includes plans offered by state and local government employers . . . .” Appellees Br. at 11.

       The relevant statute, 42 U.S.C. § 18061(b)(1)(A), requires that “health insurance issuers,
and third party administrators on behalf of group health plans, are required to make payments to
an applicable reinsurance entity for any plan year beginning in the 3-year period beginning
January 1, 2014 . . . .” This section of the ACA does not explicitly define the term “group health
plans.” Instead, the statutory framework adopts a series of cross-references to both the Public
Health Service Act (“PHSA”) and the Employee Retirement Income Security Act of 1974
(“ERISA”). First, the ACA adopts expressly the PHSA’s definition of “group health plan” as
defined by 42 U.S.C. § 300gg-91(a). 42 U.S.C. § 18021(b)(3) (“The term ‘group health plan’
has the meaning given such term by section 300gg-91(a) of this title.”). As stated in 42 U.S.C.
§ 300gg-91, a “group health plan” is “an employee welfare benefit plan (as defined in section
 No. 16-3093                      State of Ohio et al. v. United States                        Page 8


3(1) of the Employee Retirement Income Security Act of 1974 [29 U.S.C.A. § 1002(1)]) to the
extent that the plan provides medical care . . . to employees or their dependents . . . directly or
through insurance, reimbursement, or otherwise.” ERISA defines “employee welfare benefit
plan” in turn as “any plan . . . established or maintained by an employer or by an employee
organization, or by both . . . for the purpose of providing for its participants or their beneficiaries,
through the purchase of insurance or otherwise, (A) medical, surgical, or hospital care or benefits
. . . .” 29 U.S.C. § 1002(1).

       The Public Health Service Act explicitly contemplates that plans like Ohio’s are covered
under the definition of “group health plan.” Under a section titled “Limitation on application of
provisions relating to group health plans,” the PHSA specifically provides that certain “non-
Federal governmental plans” may elect to be excluded from certain provisions of the PHSA.
42 U.S.C. § 300gg-21(a)(2). Congress must have therefore intended that a subset of group health
plans include certain non-Federal governmental plans. The PHSA’s enforcement mechanism
further supports the Federal Government’s argument that non-Federal governmental plans are
indeed a subset of group health plans under the PHSA. Generally, the PHSA grants enforcement
authority over health insurance issuers to the States. 42 U.S.C. § 300gg-22(a). However, the
Federal Government exercises enforcement authority over “group health plans that are non-
Federal governmental plans.” Id. § 300gg-22(b)(1)(B).

       Provisions in ERISA further support that Congress intended the term “group health
plans” to include plans offered by state and local government employers. ERISA defines both
“employee welfare benefit plan” and “governmental plan.” 29 U.S.C. §§ 1002(1), (32). An
“employee welfare benefit plan” is “any plan, fund, or program which was heretofore or is
hereafter established or maintained by an employer . . . .” Id. § 1002(1). A “governmental plan”
is “a plan established or maintained for its employees by the Government of the United States,
by the government of any State or political subdivision thereof, or by any agency or
instrumentality of any of the foregoing.”         Id. § 1002(32).    Similar to the PHSA, ERISA
contemplates that a governmental plan is a type of employee welfare benefit plan. See id.
§ 1003(b)(1) (“The provisions of this subchapter shall not apply to any employee benefit plan if
. . . such plan is a governmental plan (as defined in section 1002(32) of this title).” That
 No. 16-3093                    State of Ohio et al. v. United States                       Page 9


Congress provided an exclusion for governmental plans from certain provisions of ERISA that
apply to employee welfare benefit plans confirms, under the ERISA definition that applies to the
ACA, that governmental plans are employee welfare benefit plans. To conclude otherwise
“violates the interpretive canon that cautions against construing statutory language in a way that
renders any of it superfluous.” U.S. v. Llanez-Garcia, 735 F.3d 483, 498 (6th Cir. 2013).

       Ohio contends that reliance on ERISA is misplaced because ERISA’s definition of the
term “employee benefit plan” uses the word “employer” which is defined elsewhere in the statute
using, inter alia, the word “person.” Appellants Br. at 19. We need not reach this issue because
the definitions in the PHSA and ERISA are clear that the term “group health plans” under the
ACA encompasses employee welfare benefit plans, which include governmental plans. We have
previously rejected an argument similar to Ohio’s. See Cunningham v. Gibson Cty., Nos. 95-
6665, 95-6667, 1997 WL 123750, at *2 (6th Cir. Mar. 18, 1997) (“[I]f defendants’ argument that
local governments are not persons within the meaning of [the Fair Labor Standards Act] is
accepted, the result is exemption of local governments from even FLSA’s most fundamental
provisions. As this cannot be understood to have been the intent of Congress, the defendants’
argument must fail.”). Similarly, adopting Ohio’s argument that ERISA’s use of the term
“person” evinces Congress’s intent not to cover states requires that the statute’s explicit
indications to the contrary be ignored. We will not do so. Congress has demonstrated an ability
explicitly to exempt state and local governments from certain requirements in the past, and it
chose not to do so with respect to the Program. We therefore conclude that Congress intended
the Transitional Reinsurance Program to apply to the States with the same force that it applies to
private employers.

       2. Ohio’s Michigan v. United States and “Plain Statement Rule” Arguments Fail

       Ohio next argues that the health plans it offers to its employees and those plans offered to
the employees of its subdivisions do not qualify as group health plans under the Act because
Congress has never made a plain statement of its intent. The United States responds that “[c]lear
statement principles do not advance [Ohio’s] position, because the relevant statutory text clearly
encompasses [Ohio’s] plans.” Appellees Br. at 24. Ohio relies heavily on Michigan v. United
States for the proposition that Congress must make a plain statement regarding any tax that it
 No. 16-3093                    State of Ohio et al. v. United States                     Page 10


wishes to impose directly against a state. Mich. v. U.S., 40 F.3d 817, 824 (6th Cir. 1994). In
Michigan, we held both that the Michigan Educational Trust, which was established to assist
parents in financing their children’s college educations, was a public agency not subject to
federal income taxation in the absence of a plain statement from Congress, and that the plain
statement rule applies in the tax field. 40 F.3d at 818. Ohio is correct that in Michigan we
reiterated that “before a federal tax can be applied to activities carried on directly by the States
. . . the intention of Congress to tax them should be stated expressly and not drawn merely from
general wording of the statute applicable ordinarily to private sources of revenue.” Id. at 823
(internal quotation marks omitted).

       Ohio, however, asks too much of the ACA. The Supreme Court has “never required that
Congress make its clear statement in a single section or in statutory provisions enacted at the
same time.” Kimel v. Florida Bd. of Regents, 528 U.S. 62, 76 (2000). Thus, we conclude that
the ACA’s cross-reference definitional scheme is perfectly appropriate. See also Sebelius v.
Auburn Reg’l Med. Ctr., 133 S. Ct. 817, 824 (2013) (holding that Congress need not “incant
magic words in order to speak clearly,” and requiring that the Court “consider ‘context, including
this Court’s interpretations of similar provisions in many years past.’”(citation omitted)). When
considering the Transitional Reinsurance Program in the context of the ACA (including the
relevant definitions provided by the PHSA and ERISA) and our interpretations of similar
provisions in cases past, we conclude that it is evident that Congress intended the term “group
health plans” to encompass Ohio’s plan.

       Ohio’s reliance on Michigan is misplaced for another important reason: Michigan dealt
with a statutory scheme that was directed specifically toward corporations. The United States in
Michigan failed to provide any evidence that Congress intended to tax state trusts, and even
conceded that the statute had never been interpreted as so doing. Michigan, 40 F.3d at 823. By
contrast, there is no question that the ACA, at least in part, applies to the States. The only issue
before us is whether the term “group health plan” is meant to encompass health plans offered by
state employers to their employees. A close and careful reading of the ACA and its cross-
references compels an answer in the affirmative. Congress’s plain statement that the Program
applies to the States can be found in the series of cross-references discussed supra. We therefore
 No. 16-3093                    State of Ohio et al. v. United States                     Page 11


conclude that Ohio’s statutory challenge fails, and the Transitional Reinsurance Program applies
to the State of Ohio.

C. Ohio’s Constitutional Claims

       Ohio next argues that applying the Transitional Reinsurance Program to the States
violates the Tenth Amendment to the United States Constitution. Specifically, Ohio objects to
application of the Program under both the anti-commandeering and intergovernmental tax
immunity doctrines. Ohio is concerned that the Program “requires an extraordinarily expansive,
uncabined theory of federal power . . . under which federal politicians would be free to try to
accrue political support through any type of corporate welfare scheme imaginable and then shirk
accountability for total costs by ordering the States to collect money from their own citizens
. . . .” Appellants Br. at 53. Further, Ohio argues, instead of aiding Ohio or its employees in
connection with the State’s money, the program “transfers money to private companies (that by
definition do not insure the State employees) and [] takes for the federal general fund dollars that
by law cannot be used for the purposes of the federal program under which the tax arises.” Id.
We find Ohio’s alarmist posturing unpersuasive because the Program does not commandeer
Ohio’s legislative authority nor does it violate any remaining vestiges of the intergovernmental
tax immunity doctrine.

       1. Ohio’s Anti-commandeering Claim is Foreclosed by Garcia v. San
          Antonio Metropolitan Transportation Authority.

       Ohio first argues that payments to Transitional Reinsurance Program violate the Tenth
Amendment because the Program commandeers Ohio’s regulatory apparatus. The Supreme
Court in Garcia v. San Antonio Metropolitan Transit Authority faced the question of whether
there existed a Tenth Amendment violation where a state governmental employer was required
to meet the overtime and minimum-wage requirements of the Fair Labor Standards Act (FLSA).
469 U.S. 528, 530 (1985). The Court found no violation because “Congress’ action in affording
SAMTA employees the protections of the wage and hour provisions of the FLSA contravened no
affirmative limit on Congress’ power under the Commerce Clause.” Id. at 555–56. The Garcia
Court held that the Tenth Amendment did not prohibit Congress from regulating state employers
in the same manner that it regulates private-sector employers. We have similarly held that
 No. 16-3093                      State of Ohio et al. v. United States                     Page 12


Congress may enact “generally applicable laws that regulate state activities in the same manner
as private conduct” and not violate the Tenth Amendment. See EEOC v. Ky. Ret. Sys., 16 F.
App’x 443, 452 (6th Cir. 2001).

       Ohio’s principal argument that the Program commandeers the State’s regulatory
apparatus relies almost exclusively on Printz v. United States, 521 U.S. 898, 930 (1997), and
New York v. United States, 505 U.S. 144, 169 (1992). In Printz, a federal firearms law required
that the chief law-enforcement officer in each local jurisdiction conduct certain checks to ensure
compliance with the statute until a national background-check system was operative. Printz,
521 U.S. at 902. In the 1992 New York case, the Federal Government mandated that the States
provide for disposal of certain low-level radioactive waste, and in some instances take title to and
become liable for all damages caused by a state’s failure promptly to take possession of said
waste. New York, 505 U.S. at 150–51. The Supreme Court struck down both laws on the
grounds that Congress impermissibly commandeered the legislative process of the States.

       Neither Printz nor New York is applicable in this case. The congressional action in both
cases required that certain state actors engage in specific conduct in order to comply with the
statute. As we have previously held, there exists an important distinction in the Supreme Court’s
anti-commandeering cases between “generally applicable laws that regulate state activities in the
same manner as private conduct,” which have been held constitutional, and laws “that seek to
control or influence the manner in which the States regulate private conduct,” which are
unconstitutional. See Ky. Ret. Sys., 16 F. App’x at 452. See also South Carolina v. Baker,
485 U.S. 505, 514 (1988) (holding that a federal tax law was constitutional where it “regulates
state activities” and does not “seek to control or influence the manner in which States regulate
private parties”); Reno v. Condon, 528 U.S. 141, 151 (2000) (upholding a federal law because it
“does not require the States in their sovereign capacity to regulate their own citizens.”). We
cannot conclude that the Program seeks to control or influence the manner in which a state
regulates private parties. Instead, it regulates the States directly by requiring participation in the
Program in the exact same manner that it requires participation by private employers. This is a
classic case of congressional action that is constitutionally permissible under the Tenth
Amendment, and we therefore find Ohio’s anti-commandeering arguments unpersuasive.
 No. 16-3093                    State of Ohio et al. v. United States                    Page 13


       As the district court so aptly noted, “[t]he Affordable Care Act requires Ohio and its
instrumentalities and political subdivisions to comply with a federal regulatory program, not to
implement one.” Ohio, 154 F. Supp. 3d at 659. We therefore conclude that the Federal
Government has not commandeered the States by requiring participation in the Transitional
Reinsurance Program in the same manner that it requires participation by private employers.

       2. The Program Does Not Violate the Intergovernmental Tax Immunity Doctrine

       Ohio’s final argument is that the Transitional Reinsurance Program is a violation of the
intergovernmental tax immunity doctrine, the concept that the federal and state governments
should not tax each other. See New York v. United States, 326 U.S. 572, 576 (1946) (“[T]he fear
that one government may cripple or obstruct the operations of the other early led to the
assumption that there was a reciprocal immunity of the instrumentalities of each from taxation by
the other.”).   The district court concluded that the Program does not run afoul of the
intergovernmental tax immunity doctrine because that doctrine “now protects only against
discriminatory taxes levied directly on the states,” and that “the Transitional Reinsurance
Program imposes reinsurance contributions on private-sector employers and state and local
government employers equally—i.e., non-discriminatorily.” Ohio, 154 F. Supp. 3d at 659.
We agree.

       In the 1946 New York v. United States case, the Supreme Court upheld a federal tax
imposed on the State of New York’s bottling and sale of mineral water. New York, 326 U.S. at
573–74. Under the law at the time, public instrumentalities of the States were immune from
taxation provided they were performing a “governmental function” and not a business or
proprietary function. Id. at 579–80. The New York Court abandoned that rigid distinction,
though no majority of the justices could agree upon a single rationale, with two justices agreeing
that any non-discriminatory tax imposed upon a state was constitutional and four justices finding
that a non-discriminatory tax could be unconstitutional if it “interfere[s] unduly with the State’s
performance of its sovereign functions of government.” Id. at 587–89. The Supreme Court has
only occasionally subsequently addressed the intergovernmental tax immunity doctrine.
 No. 16-3093                     State of Ohio et al. v. United States                     Page 14


       A tax against the States will withstand a Tenth Amendment challenge if it: (1) does not
discriminate against the States; and (2) can be remedied through the political process. See
Massachusetts v. U.S., 435 U.S. 444, 456 (1978) (“the political process is uniquely adapted to
accommodating the competing demands ‘for national revenue, on the one hand, and for
reasonable scope for the independence of state action on the other.’”(citation omitted)); Baker,
485 U.S. at 526 n.15 (“the threat of destroying another government can be realized only if the
taxing government is willing to impose taxes that will also destroy itself or its constituents.”).
See also W. Lynn Creamery, Inc. v. Healy, 512 U.S. 186, 200 n.17 (1994) (noting that “in the
field of intergovernmental taxation . . . nondiscrimination . . . plays a central role in setting the
boundary between the permissible and the impermissible.”).

       Ohio concedes that “the immunity doctrine has been narrowed over the years, and it is no
longer understood to forbid indirect taxes on items such as state employee salaries or income
from state contracts.” Appellants Br. at 56 (citing Baker, 485 U.S. at 520–23). Ohio urges us to
examine closely the plurality opinion delivered in Massachusetts v. United States, which
recognized “the limitation the existence of the States constitutionally imposes on the national
taxing power.” 435 U.S. at 459. However, we conclude that reliance on Massachusetts is
misplaced, as that Court had “no occasion to decide either the present vitality of the doctrine of
state tax immunity or the conditions under which it might be invoked.” Id. at 454. Indeed, the
Massachusetts Court upheld a federal fee that was applied to state-owned property. Id. at 446.
Michigan v. United States, the very case upon which Ohio so heavily relies for its statutory
argument, speaks directly to the question of immunity. See Mich. v. U.S., 40 F.3d at 822 (“The
broad constitutional immunity from federal taxation once thought to be enjoyed by states . . . has
been severely eroded . . . and several years ago the Supreme Court suggested that it is now an
open question whether there is ‘any’ extent ‘to which States are currently immune from direct
non-discriminatory federal taxation.’” (quoting Baker, 485 U.S. at 518 n.11)). As this court
noted in Michigan, “today’s Supreme Court would say that Congress is free to impose a non-
discriminatory tax” on a state government. Id. at 823.

       At least one of our sister circuits agrees with the district court’s conclusion that any
intergovernmental immunity analysis requires examination of discriminatory application. The
 No. 16-3093                         State of Ohio et al. v. United States              Page 15


Seventh Circuit in Travis v. Reno, 163 F.3d 1000 (7th Cir. 1998), upheld a federal statute that
levied upon the States certain fines for their failure to comply with its strictures. In upholding
the statute, the court noted that:

        Gradually intergovernmental immunity turned into a rule of nondiscrimination,
        under which the governmental body’s protection is vicarious: one government
        may tax (or regulate) another’s trading partners only to the extent it imposes
        equivalent burdens on those who do business with private citizens. Neutrality
        between governmental and private spheres is a principal ground on which the
        Supreme Court has held that states may be subjected to regulation when they
        participate in the economic marketplace—for example, by hiring workers covered
        by the Fair Labor Standards Act. So long as public market participants are treated
        the same as private ones, they enjoy the protection the latter have been able to
        secure from the legislature; and as Congress is not about to destroy private
        industry (think what that would do to the tax base!) it can not hobble the states
        either.

163 F.3d at 1002–03 (citations omitted). While the Seventh Circuit was not directly confronted
with a challenge to the intergovernmental tax immunity doctrine, we find its logic persuasive,
and in line with our conclusion in Michigan. Whether the intergovernmental tax immunity
doctrine is one which the Supreme Court would acknowledge as having any force today is an
open question. We thus agree with the district court that “even under the State’s erroneous view
of the continued validity of the intergovernmental tax immunity doctrine, the Transitional
Reinsurance Program remains constitutional.” Ohio, 154 F. Supp. 3d at 665.

        We conclude that the tax imposed under the Transitional Reinsurance Program is a non-
discriminatory tax applied evenly to public and private group health plans. Application of the
Program to the State of Ohio does not violate the intergovernmental tax immunity doctrine.

                                           III. CONCLUSION

        Because the Transitional Reinsurance Program was intended to apply to the State of
Ohio, and because its application does not run afoul of the important principles of federalism or
the Tenth Amendment to the United States Constitution, we AFFIRM the grant of the United
States’s motion to dismiss and the denial of Ohio’s motion for summary judgment.
