When I first saw this headline I felt genuine panic — Court Rules That Subsidies in Obamacare’s Federal Exchange are Illegal, Dealing Huge Legal Blow to Health Law. That’s the headline at Hit & Run, where the Koch-funded libertarians probably are doing cartwheels around their desks. You can look it up if you want to read it.
Here’s the story on Talking Points Memo. The two Republican judges on the three-panel D.C. Circuit Court of Appeals decided that the state insurance exchanges run by the federal government may not offer subsidies, or the tax credits offered by the IRS. The one Democrat called this bullshit.
“This case is about Appellantsâ€™ not-so-veiled attempt to gut the Patient Protection and Affordable Care Act,” Edwards wrote in his dissenting opinion. He called said the majority’s reading of the statute amounts to “a poison pill to the insurance markets in the States that did not elect to create their own Exchanges. This surely is not what Congress intended.”
My initial panic was mollified somewhat by the realization this decision does not affect the New York exchange, which is run (somewhat clumsily) by New York. Still, it’s a hell of a mess, and it’s not clear to me if this will go into effect immediately. If so, a lot of people are about to lose the insurance they’ve had for less than a year.
The White House is going to ask the full panel to rule on the decision, which could possibly reverse it.