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

McClatchy Tribune News Service Memo Pad Politics

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

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  1. dorothywjenkins July 22, 2014

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  2. Aanna1123 July 22, 2014

    Real nice! Anything to make our President look bad! Idiots!!!!

    1. BiteMeLiberals July 24, 2014

      He does it on his own.

      1. Aanna1123 July 24, 2014

        LOL, I see we have an uninformed mouthpiece.

        1. BiteMeLiberals July 26, 2014

          So be the dumbass.

  3. Stuart July 22, 2014

    So, Republican judges cry crocodile tears over the poor losing health care. “This hurts me more than you,” daddy says, as he takes a belt to his kid. Also reminds me of Dred Scott. Throw in Inspector Javert for good measure.

    This 2-1 ruling will go “en banc,” and likely be reversed. Only then will it go to the Supreme Court. The story should have mentioned that possibility.

    Anyway, there is a very old legal doctrine about getting an “absurd result.” Maybe it doesn’t apply anymore.

  4. elw July 22, 2014

    Well, I just wonder how the millions in those red States who got their insurance through the Federal exchange are going to like losing it because their Republican representatives decisions to not put together an exchange? That should teach them a lesson about how their own votes can affect them. I would guess it will cause more shifting to left of the votes in those States. Everything the Republicans do seems to end up hurting them more than the Democrats they target.

    1. TZToronto July 22, 2014

      No, they’ll blame President Obama. Do you think many of them will have heard about this ruling? All they’ll know is that the subsidy they expected won’t be paid. Whose fault? Just guess.

      1. elw July 22, 2014

        Since we are talking red States only, it seems you do not have much confidence in the people there. I am rather struck by the fact that you find it cleaver that Obama will be blamed for something cause by the GOP. Says a lot about your morality.

        1. TZToronto July 22, 2014

          Just going by recent history. Benghazi was Obama’s fault, right? The Ukraine Malaysia crash was designed by Obama to take the heat off the border situation, right? The mess in Iraq is Obama’s fault, even though the withdrawal agreement was made during GW Bush’s tenure, right? Speaking of right, the Right will always blame President Obama for anything they don’t like. There’s no morality involved here, just observation. My point is that the people who are affected by this ruling may not realize that it’s the result of their states’ not accepting the federal assistance that was promised if they created their own exchanges. . . . that and the failure of a proofreader to catch the error in the text of the bill.

  5. Sand_Cat July 22, 2014

    Yeah, all those “Libertarians” just love to screw others. I was going to ask, what ass brought the suit, but the answer is no surprise. So much for “live and let live.”

    1. michaeljashley July 24, 2014

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  6. Lynda Groom July 22, 2014

    This ruling will be appealed and the overall circuit court, which is mostly Democratic leaning, will overturn todays decision. Then it will eventually move along to the Supreme’s where it is anyone’s guess. Mine is yet another 5-4 decision.

  7. latebloomingrandma July 23, 2014

    This is like Theater of the Absurd. Or—like a bunch of 9 year olds playing a game where they make up the rules as they go along——Na,na,na na,na—i GOTCHA.


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