Court Deals Blow to Subsidies-Ruling Is Major Setback to Implementation of Obamacare

By Brent Kendall
July 22, 2014

WASHINGTON—A federal appeals court on Tuesday struck down the subsidies available to some consumers who buy health coverage on insurance exchanges established by the federal government, in a substantial blow to the Obama administration's implementation of its signature health-care law.

 

The U.S. Court of Appeals for the District of Columbia Circuit, on a 2-1 vote, invalidated an Internal Revenue Service regulation that implemented a key piece of the 2010 Affordable Care Act.  The regulation said subsidies for health insurance were available to qualifying middle- and low-income consumers whether they bought coverage on a state exchange or one run by the federal government.

 

The ruling potentially could cripple the law by making subsidies unavailable in as many as 36 states where the federal government has run some or all of the insurance exchanges... the rest

DC court ruling deals new blow to Affordable Care Act   ...“We conclude that the ACA unambiguously restricts the [authorized] subsidy to insurance purchased on exchanges ‘established by the state,'” said Judge Thomas Griffith. “We reach this conclusion, frankly, with reluctance. At least until states that wish to can set up Exchanges, our ruling will likely have a significant consequences for millions of individuals receiving tax credits through federal exchanges and for health insurance markets more broadly.”...

Update: Separate US appeals court upholds Obamacare subsidies

The U.S. Court of Appeals for the Fourth Circuit upheld a federal regulations that implemented subsidies that are vital to President Barack Obama's healthcare overhaul, in direct conflict with another ruling on the issue handed down earlier on Tuesday.

A three-judge panel unanimously said the law was ambiguous, and that it would defer to the IRS's determination that subsidies could go to individuals who purchased health insurance on both federal and state-run exchanges...