The National  Memo Logo

Smart. Sharp. Funny. Fearless.

Monday, December 09, 2019

D.C. Court Ruling Deals New Blow To Affordable Care Act

By David G. Savage, Los Angeles Times

President Obama’s health care law was dealt a new blow Tuesday as a federal appeals court ruled that due to a wording glitch in the Affordable Care Act, some low- and middle-income residents are not entitled to receive government assistance to subsidize their insurance.

In a 2-1 vote, a panel of judges on the U.S. Circuit Court of Appeals for the District of Columbia rejected the Obama administration’s argument that the problem was triggered by imprecise language in the complex law and that Congress had always intended to offer the subsidies nationwide to low- and middle-income people who bought insurance through one of the state or federal health exchanges created under the law.

As written, the law states that subsidies should be paid to those who purchase insurance through an “exchange established by the state.”

That would seem to leave out the 36 states in which the exchanges are operated by the federal government.

Lawyers and congressional staffers who worked on the 2010 law have described the problem as a classic wording glitch in a long and complicated piece of legislation.

One part of the law says that states, which normally regulate insurance, could create exchanges that would help consumers and small businesses shop for coverage. The law also said that if a state failed to establish an exchange, the federal government could step in and run one in its place.

A second part of the law described the subsidies that could be offered to low- and middle-income people to cover the cost of the insurance. This part of the law said these subsidies — or tax credits — would be offered for insurance bought on an exchange “established by the state.”

Apparently no one noticed the problem until the law was passed. Then, because of fierce political opposition and the 2010 Republican takeover of the House, supporters of the law could not fix the wording through an amendment. Moreover, the administration did not anticipate that most Republican-led states would refuse to create an insurance exchange for their residents.

The Internal Revenue Service adopted a regulation in 2012 that said individuals who qualify for subsidized insurance that is purchased on a government-run exchange may receive a tax credit, “regardless of whether the exchange is established and operated by a state.”

But the libertarian Competitive Enterprise Institute filed a lawsuit, Halbig vs. Burwell, on behalf of several plaintiffs, contending that regulation is illegal.

They lost in January before a federal judge who decided Congress intended to offer the insurance subsidies to everyone who qualified.

The administration is expected to appeal the panel’s decision to the full 11-member appeals court. In the last year, Obama has added four judges to the D.C. Circuit court, giving Democratic appointees a majority for the first time since the mid-1980s.

If that effort should fail, the administration could appeal to the Supreme Court.

AFP Photo/Jim Watson

Interested in U.S. politics? Sign up for our daily email newsletter!

Advertising

Start your day with National Memo Newsletter

Know first.

The opinions that matter. Delivered to your inbox every morning

Leopard 2 tanks

This is the latest report in my months-long coverage of the war in Ukraine. For more reporting like this, and to read my screeds about the reprehensible Republican Party, please consider becoming a paid subscriber.

Keep reading...Show less
Youtube Screenshot

With Republicans once again setting the stage for gridlock in Congress over raising the U.S. Treasury's statutory debt limit, and using interviews to push disingenuous analogies comparing the federal government’s budgeting practices to that of an average American household. The real danger is that mainstream media could fall for this misleading comparison and pressure Democrats into enacting painful cuts to popular social programs, while also letting Republicans off the hook for their role in manufacturing this crisis in the first place.

These comparisons between federal and household budgets go back many years, and they ignore some glaring differences: Unlike a household or business, the U.S. government issues its own currency and can roll over its own debt. The political utility of this comparison, however, is that it has enabled conservatives to target social programs, while they avoid answering for their own role in running up the public debt through unfunded tax cuts under Republican administrations.

Keep reading...Show less
{{ post.roar_specific_data.api_data.analytics }}