Arguments Not in Favor of Subsidies Find a Foothold

The United States Court of Appeals for the District of Columbia Circuit, where 2 of the three judges agreed to the argument that people who bought health insurance on the federal marketplace should not avail tax subsidies. The White House faced a seriously legal challenge to The Affordable Care Act. Plaintiffs in the case state that according to the law, only people buying insurance established through the state were eligible for tax subsidies and not for those who bought insurance from the exchange established by the federal government. 4.2 million people who chose private health plans – 2.6 million of them got cover from the federal exchange and four-fifth of them were eligible for tax subsidies. Many of them could afford to buy insurance only due to the subsidies. Assistant attorney general - Stuart F. Delery, said that subsidies were meant for people with low to moderate income regardless of whether they bought insurance on the federal exchange or state exchange. Harry T. Edwards, a senior circuit judge, said “it seems preposterous” to suggest that subsidies should not be available in the federal exchange, which serves states with about two-thirds of the nation’s population.

That interpretation of the law he said, would “gut the statute.”

Mr. Delery, the Obama administration lawyer, said that the federal secretary of health and human services “stands in the shoes” of a state when she establishes exchanges for states that are unwilling or unable to do so. The purpose of the law was to provide affordable health care to all American citizens.

If Congress had wanted to make subsidies contingent on a state’s creation of an exchange, “it would have needed to provide clear notice” to states, and it did not do so, Judge Spencer said.

References:

Robert Pearmarch, March 2014

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Hannah Punitha (IRDA Licence Number: 2710062)

Source-Medindia