The Next Effort to Gut Health Reform – A Tale of Two Decisions
Today, two circuit courts ruled on whether the Affordable Care Act (ACA) allows individuals enrolled in health insurance through the Federally Facilitated Marketplace to receive federal subsidies to help with health insurance costs, specifically premium tax credits and cost-sharing reductions.
The Fourth Circuit Court of Appeals upheld these subsidies, finding that the IRS interpretation providing subsidies through the Federally Facilitated Marketplace is “permissible construction of the statutory language.”
Hours earlier, a panel of the D.C. Circuit Court of Appeals, in a 2-1 ruling, overturned the District Court’s holding in Halbig v. Burwell, finding that the ACA does not allow for subsidies in the Federally Facilitated Marketplace. The decision has no immediate effect and the Department of Justice has already stated that the Obama Administration will seek a review by the full D.C. Circuit. We are confident the panel decision will not be upheld.
If this decision were to be upheld, it would mean 4.7 million individuals—including millions of women and their families—would lose access to affordable health insurance.
As the dissent in the D.C. Circuit observed, this case is a “not-so-veiled attempt to gut the Patient Protection and Affordable Care Act.” The D.C. Circuit is the only court to find merit in the plaintiffs’ “thin” argument, which many argue is grounded in a drafting error that does not change the meaning of the statute. The D.C. Circuit decision—aside from having no immediate effect on the tax subsidies enrollees receive in the federal exchange—does not have to be the last word on this issue.
In the meantime, it is important that the message be clear that subsidies are still available through the health insurance marketplaces in all 50 states. Women and their families enrolled in coverage through the marketplace will continue to receive subsidies, and new applicants can continue to enroll if they experience certain life events and at open enrollment later this year.