Questions abound as two appeals courts split on legality of health law subsidies

Jul 24 2014

Two U.S. courts of appeals reached different decisions regarding the issue of whether the health law's subsidies can be used by consumers shopping for health coverage on the federal exchange, because their states opted against setting up their own online insurance marketplace. This development injects confusion as the Obama administration works toward the next open enrollment season, which is slated for November. Ultimately, the issue could land before the Supreme Court.

Kaiser Health News: Appeals Courts Split On Legality Of Subsidies For Affordable Care Act
Two U.S. appeals courts Tuesday reached opposite conclusions about the legality of subsidies in the Affordable Care Act, a key part of the law that brings down the cost of coverage for millions of Americans. In Washington, a three-judge panel at the U.S. Appeals Court for the D.C. Circuit ruled that the Internal Revenue Service lacked the authority to allow subsidies to be provided in exchanges not run by the states (Rovner, 7/22).

The New York Times: New Questions On Health Law As Rulings On Subsidies Differ
Two federal appeals court panels issued conflicting rulings Tuesday on whether the government could subsidize health insurance premiums for millions of Americans, raising yet more questions about the future of the health care law four years after it was signed by President Obama. The contradictory rulings will apparently have no immediate impact on consumers. But they could inject uncertainty, confusion and turmoil into health insurance markets as the administration firms up plans for another open enrollment season starting in November (Pear, 7/22).

NPR: Obama's Health Care Law Has A Confusing Day In Court
Another wild legal ride for Obamacare on Tuesday: Two U.S. Court of Appeals panels issued conflicting decisions on an issue with the potential to gut the health care overhaul. The two rulings could lead to another U.S. Supreme Court showdown over the controversial law, all because of what one of the law's opponents initially called "a glitch" (Totenberg, 7/22).

The Washington Post: Federal Appeals Courts Issue Contradictory Rulings On Health-Law Subsidies
The conflicting rulings give traction to the most serious current threat to the Affordable Care Act, which has been battered by a series of legal challenges since it was enacted four years ago. The dispute centers on whether the subsidies may be awarded in states that chose not to set up their own insurance marketplaces and instead left the task to the federal government. About 5.4 million people had signed up for coverage on the federal exchange as of this spring, federal figures show. About 87 percent of them received subsidies (Somashekhar and Goldstein, 7/22).

The Wall Street Journal: Appeals Courts Issue Conflicting Rulings On Health-Law Subsidies
In a blow to President Barack Obama's signature legislative achievement, a panel of 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 health law. The regulation said subsidies for health insurance were available to qualifying middle- and low-income consumers whether they bought coverage on a state or federally run exchange. Two hours later, a three-judge panel of the U.S. Court of Appeals for the Fourth Circuit in Richmond, Va., reached the opposite conclusion, unanimously ruling that consumers in states relying on the federal marketplace could receive subsidies. That handed the White House a victory that counteracted the administration's loss in the other case (Kendall and Armour, 7/22).

Los Angeles Times: Federal Appeals Courts Issue Conflicting Rulings On Obamacare
The legal battle gives Obamacare's opponents another shot at trying to kill the law in the high court, a goal they fell one vote short of in 2012. In that case, four justices voted to strike down the entire legislation as unconstitutional. Chief Justice John G. Roberts Jr. joined the four liberal justices to uphold the core of the law. This time, the outcome at the high court would turn on whether at least one of the five conservative justices agreed to uphold Congress' broad goal of providing all Americans with insurance they can afford (Savage, 7/22).

Politico: Wild Day For Obamacare: Appeals Court Rulings Conflict
For now, no one will have their subsidies cut off while the legal battle continues. The Obama administration said it will appeal the D.C. ruling on Halbig v. Burwell by asking for an en banc review involving the full panel. "We are confident in the legal case that the Department of Justice will be making," said White House press secretary Josh Earnest. The plaintiffs in the fourth circuit's King v. Burwell in Virginia haven't yet said what they'll do next (Winfield Cunningham, 7/22).

The Associated Press: Appeals Courts Split on Health Law's Subsidies
President Barack Obama's health care law is snarled in another big legal battle, with two federal appeals courts issuing contradictory rulings on a key financing issue within hours of each other Tuesday. But the split rulings don't necessarily mean another trip to the Supreme Court for the Affordable Care Act. And White House spokesman Josh Earnest immediately announced that millions of consumers will keep getting financial aid for their premiums as the administration appeals the one adverse decision (7/23).

Reuters: Latest Obamacare Legal Knot Won't Be Easy To Untangle
U.S. judges have their work cut out for them untangling a legal knot created on Tuesday when two federal appeals courts released conflicting rulings hours apart going to the heart of the role the federal government will play in Obamacare. The latest conservative challenge to President Barack Obama's healthcare overhaul will not necessarily land in the U.S. Supreme Court, although it could end up there as soon as this year if the two lower courts go on disagreeing. At stake is how millions of Americans pay for private health insurance, or if they can afford it at all (Ingram, 7/22).

Bloomberg: Obamacare On Path Back To Higher Court After Ruling Split
The U.S. Supreme Court may not be done with Obamacare yet. With appellate courts reaching opposite conclusions on the same day about a crucial financing provision of the 2010 law, a third showdown before the justices is probable. Splits among the federal circuits have preceded previous high court rulings on the Affordable Care Act. In 2012, the law was narrowly upheld when the court ruled Congress has the power to make Americans carry insurance or pay a penalty. Last month, the court said private companies can claim a religious exemption from a requirement that they offer birth-control coverage (Harris and Zajac, 7/23).

USA Today: Appeals Court Panels Issue Split Decisions On Obamacare
The federal subsidies offered through the exchanges have reduced monthly insurance premiums by 76% for those who qualify, federal health officials say. The average monthly premium dropped from $346 to $82. In 2016, an estimated 7.3 million people in the 34 states with federal exchanges would receive subsidies totaling $36 billion, according to the Urban Institute. To qualify for subsidies, participants must have incomes below 400% of the federal poverty line, or $95,400 for a family of four (Wolf, 7/22).

McClatchy: Courts Issue Conflicting Rulings on Health Care Tax Subsidies
Two appeals courts on Tuesday reached radically different conclusions about whether millions of consumers in 36 states can use tax credits to help buy health coverage on the federal health insurance marketplace. The conflicting rulings, combined with two other pending challenges still awaiting decisions, potentially tee up for the Supreme Court its next landmark health care case and leave one of the Affordable Care Act's signature provisions in a state of legal limbo (Doyle and Pugh, 7/23).