“Death Blow Against Obamacare,” The Huffington Post blared. “Big Blow to Obamacare Subsidies,” claimed The Washington Times. As usual, however, the reports of the demise of the Affordable Care Act have been greatly exaggerated.
Here’s what happened: The ACA set up a system of insurance “exchanges,” where people can go online, shop among various insurance plans, and check to see if they qualify for assistance (in the form of tax subsidies regulated by the IRS) to buy them. The law provided that the states could set up their own exchanges, but if for some reason they couldn’t or wouldn’t, then the Feds would do it for them.
Some states, such as California, Kentucky and Minnesota, set up their own exchanges. Those have enrolled lots of people who are getting access to health care that they’d been unable to afford before. Republican-controlled states, however, out of pure spite over the GOP’s loss on Obamacare, refused to cooperate. They turned up their noses and said, “Let the Feds do it.” Which the Feds did.
Now, however, the Court of Appeals for the D.C. Circuit, in an opinion written by two Bushista judges (one a creature of Bush the Elder, one an appointee of his egregious son Dubbya), ruled that the ACA provided for subsidies only for policies bought on exchanges actually set up by the state, not state exchanges set up by the federal government.
I’m wondering if this ruling will finally get middle-class voters to realize that Republican governments that refused to set up exchanges might end up costing them a boatload of money. Because make no mistake: This decision, if allowed to stand, will end up having serious ill effects, not on the poor (whom the right wing already loathes and despises), but on a substantial percentage of the middle class.
See, the people who qualify for a subsidy, according to the ACA, are people who make between 133 percent and 400 percent of the Federal Poverty Level. That’s $46,000 for an individual and $94,000 for a family of four.
That’s solidly middle-class, folks. Those subsidies help cover uninsured people who are too well-off for Medicaid, who aren’t covered by their employer, but don’t make enough to buy their own insurance. If that’s you, and your Republican state government refused to set up a state exchange, then they’re trying to yank the rug out from under you.
One study, as reported in The Washington Post, predicts that if the subsidies were withdrawn from federal exchanges, the estimated number of Americans without coverage would increase by 6.5 million.
Another study by consulting firm Avaler Health found that people who’d been getting subsidies would see health care premium costs rise by an average of 76 percent, with some increases in poorer areas going up to 95 percent. People in the Democratic states that set up state exchanges, however, would get to keep the insurance they bargained for.
So I would advise the rabid right not to start doing the Wingnut Monkey Dance of Triumph just yet.
Yanking away the health insurance that people just got may not be a winning issue for you.
In addition, a mere two hours after the D.C. Circuit made its ruling, the Court of Appeals for the Fourth Circuit in Richmond ruled in exactly the opposite way. It ruled that the ACA says that the Feds are operating the exchanges “within the state,” which makes it ambiguous as to whether they’d be entitled to subsidies.
It’s a long-standing principle that in a case where a law is worded ambiguously, the agency interpreting it has broad leeway. So the IRS (which, remember, regulates the subsidies) can apply it to both kinds of exchanges.
The defendants in the D.C. Circuit case can (and no doubt will) also get the case heard by the entire panel of D.C. Circuit judges, not just the three-judge panel that issued today’s decision. And if that happens, the case will be reviewed by a court made up of a majority of Democratic appointees.
In the meantime, it remains to be seen if weak-kneed Democratic politicians who have been showing lukewarm support for Obamacare have the gumption to stand up for the people they represent and point out that it’s the GOP that’s cheerleading for millions of middle-class people’s health care to be taken away.
It would be a trivially easy flaw in the wording of the statute to fix, and ACA opponents would then be forced to defend their stance that taking health care away from people who just got it is a good thing.