Ominous health care ruling
The New York Times said the following in an editorial:
Millions of low- and moderate-income people who signed up for health insurance with the help of federal tax-credit subsidies could find themselves without coverage or facing big premium bills if a destructive decision handed down by a federal appeals court in Washington on Tuesday is not reversed. It would be a crippling blow to the ability of the Affordable Care Act to reduce the ranks of the uninsured with grievous consequences for vulnerable customers.
For now, consumers are expected to retain their coverage and tax credits while this and similar suits in other jurisdictions wend their way through the court system. Just hours after the ruling in Washington, a federal appeals court panel in Richmond, Virginia, ruled the opposite way, finding that Congress intended to make the tax credits available nationwide.
Under the decision of a three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit, people living in 36 states, mostly led by Republican governors or legislatures, would be in jeopardy because their states refused to set up “exchanges” or electronic marketplaces on which individuals can shop for insurance plans and apply for subsidies based on their incomes.
For the most part, the political leaders in those states wanted nothing to do with what they deride as Obamacare, and left it up to the federal government to set up exchanges for their residents. People fortunate enough to live in the 14 states and the District of Columbia that have set up their own exchanges would escape the effect of this mindless and harmful ruling.
The 2-1 decision issued by the panel hinged on how to interpret language in the Affordable Care Act that most experts agree was poorly drafted and would ordinarily have been corrected by a congressional conference committee. In this instance, there was no conference committee because the law was passed on a take-it-or-leave-it vote in the House to avoid a Republican filibuster in the Senate.
Two Republican-appointed judges on the panel, taking an incredibly narrow and blinkered view, concluded that the language in the law allows the Internal Revenue Service to provide tax-credit subsidies only on exchanges established by the states. They decided that the statute’s wording does not allow subsidies on federally created exchanges — even though those exchanges carry out exactly the same purpose and, in effect, act on behalf of the states. The administration had expected most states to create their own exchanges, but most handed that task to the federal government.
The third judge, a Democratic appointee, called the majority opinion what it clearly was, a “not-so-veiled attempt to gut” the health care law. He argued that the law sought to achieve “near-universal coverage” of all Americans and that this could only be achieved with the help of subsidies working in tandem with a mandate that most Americans obtain health insurance or pay a penalty. It defies common sense to think that Congress really intended that there be no subsidies at all in 36 states.
The Obama administration is expected to appeal the decision to the full appellate court, whose 11 members include seven Democratic and four Republican appointees. What is needed is common sense in interpreting the law, not ideological opposition to Obamacare.
The three-judge appeals panel on the 4th U.S. Circuit Court of Appeals, based in Richmond, while acknowledging ambiguities in the language of the law, unanimously and properly upheld the subsidies as a permissible exercise of discretion by the IRS.