Appeals Court Decisions Differ on Obamacare Subsidies

WASHINGTON – Two appeals courts reached differing decisions on Obamacare subsidies Tuesday, meaning a likely Supreme Court case on the key component of the health care law.

A three-judge panel of the D.C. Circuit Court of Appeals ruled 2-1 against the subsidies, while a similar panel of the 4th Circuit down the road in Richmond, Virginia unanimously backed the Obama administration.

The opposing rulings mean the next stop for the issue will almost certainly be the nation’s highest court in a case that represents the best hopes of the 2010 law’s conservative foes to undermine it.

In the first ruling, the D.C. panel decided the federal money that helped people afford health insurance only could go to those who signed up through exchanges run by states.

That’s what the law specified, the ruling said, meaning those who signed up through the federal exchange aren’t eligible for the subsidies that helped them afford coverage.

Only 14 states and the District of Columbia set up their own exchanges, meaning that the 4.7 million who signed up for subsidized health coverage overall under Obamacare through HealthCare.gov could be affected.

“Although our decision has major consequences, our role is quite limited,” the majority opinion said, noting the question was whether the Internal Revenue Service rule regarding tax credits was permissible under the 2010 Affordable Care Act.

“Having concluded it is not, we reverse” the lower court’s decision that had favored the Obama administration.

A few hours later, the 4th Circuit panel came to the opposition conclusion, with all three judges concurring. It said the IRS had the authority to establish the tax credits and that Congress intended them to be a central component of the laws.

For now, the law remains unchanged and the subsidized policies are unaffected until the legal case plays out, White House spokesman Josh Earnest told reporters. The Justice Department said the government would appeal the D.C. panel’s decision.

However, the potential long-term impact is huge.

If the Supreme Court ends up ruling against President Barack Obama’s administration, the result would wipe out subsidies and undermine a key component of the Affordable Care Act’s requirement that all Americans obtain health coverage.

The easiest fix — changing the law to specify that it allows subsidies for coverage purchased through the federal government as well as state exchanges — would mean reopening the debate over the laws that passed with zero Republican support.

Republicans now control the House and are expected to make gains in the November election, perhaps also gaining a majority in the Senate.

That means Obama and Democrats have no chance of getting Congress to approve such a change in the law despised by the political right.

GOP Sen. Ted Cruz of Texas, one of the leading crusaders against the health care law, called Tuesday’s ruling “a repudiation of Obamacare and all the lawlessness that has come with it.”

He argued the federal subsidies, such as tax credits to people who didn’t sign up on state exchanges, amounted to assuming funding powers the Constitution granted Congress.

Earnest, however, said the law clearly intended to provide subsidies for all who enrolled under Obamacare, and that the administration was confident in its legal position.

13 comments

  • Jess

    Healthcare is not a right. The government should not force those of us that got and education and a job to pay for the healthcare of others.

      • Right Wing Patriot

        How to pay for it is irrelevant. The issue is the gov’t should not be able to force someone to buy a product or service. The soonner we kill this Frankenstain the better.

    • Right Wing Patriot

      So Jess is selfish just because he wants to keep the fruits of his labor? What gives you the right to call him out. Put your money where your mouth is, I challenge you to volunteer to pay for someones/familys health insurance for a year. Oh thats right, you’ll say you can’t afford it. So whats the differnce?

  • Speak the Truth

    There are 8 levels of control that must be obtained before you are able to create a social state. The first is the most important.

    1) Healthcare – Control healthcare and you control the people

    2) Poverty – Increase the Poverty level as high as possible, poor people are easier to control and will not fight back if you are providing everything for them to live.

    3) Debt – Increase the debt to an unsustainable level. That way you are able to increase taxes, and this will produce more poverty.

    4) Gun Control – Remove the ability to defend themselves from the Government. That way you are able to create a police state.

    5) Welfare – Take control of every aspect of their lives (Food, Housing, and Income)

    6) Education – Take control of what people read and listen to – take control of what children learn in school.

    7) Religion – Remove the belief in God from the Government and schools

    8) Class Warfare – Divide the people into the wealthy and the poor. This will cause more discontent and it will be easier to take (Tax) the wealthy with the support of the poor.

    Any of this sound familiar??????
    Think we aren’t there?
    Think again!

  • William Denison

    FYI Terry Branstad took in 122 illegal children from South American earlier this year before it became a issue . If he says he did not know or was unaware he is lying. But we already know he’s a liar. This ruling in regards to ACA will be overturned. Mike Ceee please stop posting using my name. You need to cover your tracks better.

    • Right Wing Patriot

      Sorry Bill, but you are incorrect. Under federal law, Homeland Security/HHS does not have to report to the states where illegals are placed. In fact, the govenor of MA didn’t know they they were getting any illegals….and he is a BIG Obama supporter. The reason this is on the ‘down-low’ because they knew the American people would flip out. Which they have done.

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