Two Courts, Two Rulings: But Health Care Subsidies Will Continue for Now

On Tuesday, July 22, two legal challenges to provisions for health care subsidies in the Affordable Care Act resulted in contradictory rulings from federal appeals courts. The challenges argued that, under the wording of the act, subsidies to help low- and middle-income residents pay their health insurance premiums should only be available to those purchasing insurance via exchanges set up by a state, and not to those purchasing insurance via HealthCare.gov, the federal health insurance exchange website. For now, health premium subsidies for people who purchased through HealthCare.gov will continue, but the conflicting decisions also mean that the health care law will be back in the courts as the cases are reheard, the Associated Press reported.

The judges in Halbig v. Burwell, which was heard by the U.S. District Court for the District of Columbia, ruled 2–1 that the subsidies could only be legally offered through state exchanges, as reported by the Albany Times-Union. In the ruling, Circuit Judge Thomas Griffith wrote, “Because we conclude that the ACA unambiguously restricts the section 36B subsidy to insurance purchased on Exchanges ‘established by the State,’ we reverse the district court and vacate the IRS’s regulation.”

Hours later, the justices hearing King v. Burwell in the U.S. Court of Appeals for the Fourth Circuit in Richmond, Virginia, unanimously came to the opposite conclusion, the Times-Union reported. In the court opinion, Judge Roger Gregory wrote: “The defendants argue, sensibly, that if premium tax credits were not available on federally-run Exchanges, there would be no reason to require such Exchanges to report … information [to Health & Human Services]…. It is therefore possible to infer from the reporting requirements that Congress intended the tax credits to be available on both state- and federally-facilitated Exchanges.”

And while conservatives hailed the D.C. Circuit decision, the White House lauded the Fourth Circuit ruling. In a statement, White House Press Secretary Josh Earnest said, “Another partisan attempt to harm the Affordable Care Act failed today. This latest attempt was undermined by a unanimous judicial panel in the Fourth Circuit. The law was designed to make health care affordable through tax credits — and it is working.”

According to AP, soon after the Richmond ruling, the White House stressed that those who purchased through the federal exchange will continue to receive financial aid as the Obama administration figures out the legal implications of the two rulings.

It is possible that the challenge could ultimately be heard by the Supreme Court, as reported by the New York Times, which provided a fact sheet of the myriad legal permutations available to both the plaintiffs and defendants in the case.