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Matt Dunning

Federal exchange premium subsidies still available while lawsuits proceed

July 23, 2014 - 2:32pm

Federal Health Care Subsidies


The Obama administration has said it will continue providing premium subsidies for health care plans purchased through federally run public insurance exchanges, pending a final resolution of two lawsuits seeking to drastically limit their availability.

A spokeswoman for the U.S. Department of Justice said Wednesday that the government will seek an en banc rehearing before all 17 judges of the District of Columbia Circuit Court of Appeals in Washington in the hopes of overturning one of two conflicting rulings issued Tuesday regarding a key provision of the Patient Protection and Affordable Care Act.

At the center of both cases is the question of whether the health care reform law's text allows the federal government to issue tax credits in the form of premium subsidies through the public insurance exchanges it operates in addition to exchanges run by individual states.

If the Justice Department's request for an en banc rehearing is denied, or if the full D.C. Circuit Court upholds the panel's ruling, the next procedural step would be a petition to the U.S. Supreme Court.

“In the meantime to be clear, people getting premium tax credits should know that nothing has changed; tax credits remain available,” the Justice Department said in a statement released late Tuesday afternoon.

A divided three-judge panel of the D.C. Circuit Court ruled Tuesday morning that the health care reform law's language expressly limits the government to providing subsidies for health insurance bought through a state-run public exchange.

Less than two hours later, a second three-judge panel of the 4th U.S. Circuit Court of Appeals in Richmond, Virginia, ruled unanimously that the reform law's language was ambiguous enough to allow the government to provide the subsidies to individual enrollees through both the state and federal exchanges.

The appellants in the case before the 4th Circuit have not yet indicated if they will also seek an en banc rehearing.

 



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