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Thursday, July 24, 2014

Appeals Court Deals Major Blow to Implementation of Affordable Care Act


Today's post is shared by WSJ Law Blog and comes from blogs.wsj.com

A federal appeals court on Tuesday dealt a serious blow to the Obama administration’s implementation of its signature health-care law, striking down subsidies available to some consumers who purchase health coverage on insurance exchanges set up by the federal government.

WSJ’s Brent Kendall has more on the breaking legal development out of Washington:

The U.S. Court of Appeals for the District of Columbia Circuit, on a 2-1 vote, invalidated an Internal Revenue Service regulation that implemented a key piece of the 2010 Affordable Care Act. The regulation said subsidies for health insurance were available to qualifying middle- and low-income consumers whether they bought coverage on a state exchange or one run by the federal government.

The ruling potentially could cripple the Affordable Care Act by making subsidies unavailable in as many as 36 states where the federal government has run some or all of the insurance exchanges.

The court sided with challengers, four individuals and three employers, who argued the health law allowed subsidies only for insurance purchases made through state exchanges. The issue became an important one after the law was enacted because more than two-thirds of the states chose not to set up their own exchanges, relying on federally run exchanges instead.

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