Courts Issue Conflicting Rulings on Health Care Law

By: Robert Pear
NY Times
07/22/2014
http://mobile.nytimes.com/2014/07/23...&_r=1&referrer



WASHINGTON — Two federal appeals court panels issued conflicting rulings Tuesday on whether the government could subsidize health insurance premiums for people in three dozen states that use the federal insurance exchange. The decisions are the latest in a series of legal challenges to central components of President Obama’s health care law.


The United States Court of Appeals for the Fourth Circuit, in Richmond, upheld the subsidies, saying that a rule issued by the Internal Revenue Service was “a permissible exercise of the agency’s discretion.”


The ruling came within hours of a 2-to-1 ruling by a panel of the United States Court of Appeals for the District of Columbia Circuit, which said that the government could not subsidize insurance for people in states that use the federal exchange.


Under the Affordable Care Act, the appeals court here said, subsidies are available only to people who obtained insurance through exchanges established by states.


The law “does not authorize the Internal Revenue Service to provide tax credits for insurance purchased on federal exchanges,” said the ruling, by a three-judge panel in Washington. The law, it said, “plainly makes subsidies available only on exchanges established by states.”


Under this ruling, many people could see their share of premiums increase sharply, making insurance unaffordable for them.


The courts’ decisions are the not the last word, however, as other courts are weighing the same issue. And the Washington panel’s ruling could be reviewed by the full appeals court here.


The White House rejected the ruling of the court here and anticipated that the Justice Department will ask that the entire appeals court to review it. Mr. Obama’s aides noted that two district courts have thrown out similar lawsuits and therefore argued that judicial opinions have been mixed at worst. Moreover, they said the ruling Tuesday seemed to fly in the face of common sense.


That decision could cut potentially off financial assistance for more than 4.5 million people who were found eligible for subsidized insurance in the federal exchange, or marketplace.

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