Wednesday, July 23, 2014

Obamacare Opinions Galore!

Wow, busy day for Obamacare yesterday. The big story is that a circuit split developed in the span of a few hours.

The gist of the issue is that the Obamacare statute (aka "Affordable Care Act") authorizes the government to subsidize health insurance for individuals who purchase a plan from an exchange "established by the State under section 1311." However, only 14 states (and D.C.) have established their own exchanges. In the remaining states (including Pennsylvania), the federal government has established an exchange under section 1321. The federal government has been subsidizing purchases off of the federal exchanges as well . . . but with no express statutory authority.

The D.C. Circuit yesterday, in a split opinion, stuck to the literal reading of the statute in Halbig v. Burwell. The Court remanded to the trial court to vacate the IRS rule allowing the subsidies for purchases from the federal exchanges. Meanwhile, the Fourth Circuit reached the opposite conclusion in King v. Burwell. The Fourth Circuit emphasized the context of the statute and deferred to the IRS's interpretation, upholding the subsidies to federal exchanges.

Is this issue headed to another SCOTUS Obamacare showdown? We'll see. The parties may opt to seek an en banc rehearing in either court, which could remove the circuit split (one factor the Supreme Court looks to when deciding whether to accept a case).

In yet another opinion on a different issue, a district court tossed Senator Johnson's lawsuit re: congressional health plans.

Unrelated sidenote: I want to emphasize the importance of typography. Look at the D.C. Circuit opinion and then look at the Fourth Circuit opinion. Do you see any differences in how the two documents looks? D.C.'s is beautiful - SCOTUS-esque. The Fourth Circuit's? Not so much.

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