This is a crusher. No doubt given the magnitude of what is at stake, this is going to wind up in front of the Supreme Court, but this decision is a huge blow to the Affordable Care Act. In essence, it makes it the Unaffordable Care Act because the states that have not set up their own exchanges will not be able to offer subsidies for the Silver plan (the only plan for which subsidies are offered). Apparently, the language of the bill was not as clear as its supporters claimed it to be.
The quandary for the Administration is, that if the law has to be amended to legally offer the subsidies to the states that don't have exchanges, how on earth is that going to get through the present Congress more or less one where the Republicans may potentially control both houses? What will happen to the people who have already registered and received subsidies that they may not be entitled to? To put it politely, the fecal waste is about to contact the oscillating air circulation mechanism. Stayed tuned.
Federal appeals court panel deals major blow to health law
A man looks over the signup page on the HealthCare.gov website. The controversial Affordable Care Act launched the federal health insurance exchange in October 2013. (Mike Segar/Reuters)
The ruling, if upheld, could potentially be more damaging to the law than last month’s Supreme Court decision on contraceptives.
The three-judge panel of the D.C. Circuit Court of Appeals sided with plaintiffs who argued that the language of the law barred the government from giving subsidies to people in states that chose not to set up their own insurance marketplaces. Twenty-seven states, most with Republican leaders who oppose the law, decided against setting up marketplaces, and another nine states partially opted out.
The government could request an “en banc” hearing, putting the case before the entire appeals court, and the question ultimately may end up at the Supreme Court.
But if subsidies for half the states are barred, it represents a potentially crippling blow to the health-care law, which relies on the subsidies to make insurance affordable for millions of low- and middle-income Americans.
California and Florida lead the way for state and federal healthcare sign-up markets.
Starting this year, it is mandatory to carry health insurance or pay a fine.
About 5.4 million people signed up for health insurance on the federal marketplace through the spring, the government says. Of them, about 87 percent received subsidies.
The plaintiffs in the lawsuit — three private employers and four individual taxpayers — argued that Congress intended for the subsidies to go to people in states that set up their own insurance exchanges. They cited language in the law that said the subsidies would be available to those “enrolled through an Exchange established by the State.”
Lower courts, however, have sided with the government, which has argued that Congress’s intent was for subsidies to be available in all states — a meaning it said is obvious from the law’s context.
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