ACA in the Wake of Halbig and King
I pointed out a few days ago how we hadn’t heard anything recently about ACA in the midterm elections. Well we just had two cases that in my opinion will maintain the status quo.
The conflicting appeals court rulings (Halbig v. Burwell, King v. Burwell) handed down by three-judge panels in Washington, D.C., and Richmond, Virginia, could precipitate another case before the U.S. Supreme Court, which in June 2012 narrowly upheld the Democratic president’s 2010 healthcare overhaul. Two judges appointed by Republican presidents decided against the administration in the District of Columbia and three judges appointed by Democrats ruled in favor in Richmond, Virginia.
The question before the courts is whether the government has the ability to offer premium tax credits to people who purchase private coverage through the federal insurance marketplace that serves the majority of the 8 million consumers who signed up in 2014. States including Florida and Texas, which have some of the largest uninsured populations, opted to leave the task of operating a marketplace to the federal government. The plaintiffs in Halbig v. Burwell, a group of individuals and employers from states that did not establish their own marketplaces, claimed that Congress did not intend to provide subsidies through federally operated marketplaces.
The DC court ruled the language in the Affordable Care Act dealing with subsidies shows they should only be provided to consumers who purchase benefits on exchanges run by individual states and not the federal government. They suspended their ruling pending an appeal by the administration whom said they would appeal to the full circuit court, a process that could take up to six months. Hours later, a three-judge panel of the 4th U.S. Circuit Court of Appeals in Virginia ruled unanimously to uphold the same provision in the case of King v. Burwell, saying the wording of the law was too ambiguous to restrict the availability of federal funds.
The ruling will have no impact on consumers receiving monthly subsidies now, but as many as five million people could be affected if subsidies disappear from the federal marketplace, which serves 36 states through the website HealthCare.gov. Subsidies are available to people with annual incomes of up to 400 percent of the federal poverty level, or $94,200 for a family of four.
The circuit courts in both DC and Virginia could rule on Halbig and King respectively. I’m sure other courts will issue rulings in the mean time, and both sides could appeal their cases to the Supreme Court who could decide it if they chose to. My guess would be the court kicks this case back as the solution is political for the issue seems to be ambiguity of language in the statute. Though highly unlikely approaching midterms, Congress could decide to rectify the ambiguity in the statute. I do anticipate some of the 36 states currently on the Federal exchange to setup state exchanges, and the full D.C. Circuit court, dominated by appointees of Democratic presidents, to overturn its panel’s ruling or at least revisit it. The ACA will continue chugging along.