‘Nuclear option’ could rescue Obamacare subsidy in courts
Larger Panel The Obama administration said it would ask a larger panel of judges to review the Washington courts decision. Dellinger said that, if the full District of Columbia circuit aligns with its brethren in Virginia, the Supreme Court could just leave this alone where Congress intended it. Dorf said the Washington court is reaching. Congress could not have possibly intended that there be no subsidies on the federal exchanges, he said. Yesterdays rulings apply to a portion of the law making financial aid available to income-qualified people who buy their health insurance on a marketplace established by the state. The government contends that, when considered with other parts of the law, this language covers marketplaces set up by states themselves — and by the federal government when it acts in place of states. Made Explicit The IRS in May 2012 issued a rule making that point explicit. Financial aid, in the form of tax credits, would be available for taxpayers who obtain coverage on the federal exchange because that is consistent with the language, purpose and structure of the Affordable Care Act, according to the regulation. If the Washington ruling is upheld, it may hamstring Obamacare since the plans success turns on enlarging the pool of the insured, including those who need financial aid, to cover insurance costs for those who are ill. Of the more than 8 million people who picked an insurance plan on the exchanges from October through April 19, 5.4 million selected one from the federal marketplace, according to a report by the U.S. Department of Health and Human Services.
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circuit judge for the District of Columbia Circuit, speaks with chairman Patrick Leahy, D-Vt., before the Senate Judiciary Committee hearing on the nominations of four judges on Wednesday, July 10, 2013. If upheld as law, that decision would not only revoke billions of dollars worth of subsidies. It also would effectively destroy the Obamacare rule in 36 states that people obtain health insurance or pay a fine, as well as the looming rule that will require many employers to offer affordable coverage to workers or pay a fine themselves. The Obama administration immediately announced Tuesday that it will seek to have the decision overturned by the entire D.C. appeals circuit. The administration argues that the panel’s decision was wrong because it ignores the overall intent of the ACA, to make insurance affordable for uninsured people throughout the U.S. The en banc review panel would include not only the 11 active judges on the circuit, but also the two senior judges who were on the panel that issued Tuesday’s decision. One of the senior judges, Raymond Randolph, was part of the majority opinion written by Judge Thomas Griffith that found the subsidies were illegal.
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