More Clouds on the Horizon: Fate of Obamacare Subsidies Up in the Air

We’ve long contended that it will take years for all the implications of the Affordable Care Act to play out. There’s still so much to be determined and so many factors, moving parts and unintended consequences that will ultimately shape the outcome.

On the heels of last week’s Supreme Court ruling in favor of Hobby Lobby (the court ruled that Obamacare’s contraceptive mandate violates the Religious Freedom Restoration Act with regards to closely held for-profit corporations) looms a series of potentially even more far-reaching court challenges to a major tenet of Obamacare — premium subsidies.

Photo credit: Reuters/John Gress as seen at TheFiscalTimes.com

Photo credit: Reuters/John Gress as seen at TheFiscalTimes.com

The arguments are now at the Appellate Court level and center on very specific language in the Affordable Care Act. The challenges contend that the subsidies cannot be provided to people in states aligned with the federal exchange; and, further, only those who signed up for coverage through the state insurance marketplaces are entitled to subsidies.

Who knows how the courts will rule? If they do rule against the government like they did in the Hobby Lobby case, the potential impact looms large. Only 14 states set up their own insurance marketplaces. 36 other states opted to let the federal government build and run their exchanges.

It will also probably take any rulings that go against premium subsidies as much as a year or more to play out. And, no doubt they will be challenged by the government — all the way to the Supreme Court, if necessary.

One thing’s for sure, any Appellate Court rulings against the subsidies will almost certainly make an already cloudy picture even cloudier.

There have been many challenges to Obamacare — some real, some grasping at straws. This one is garnering some serious attention from both sides of the fence lending credence to the belief that the fate of the subsidies for now could be very much up in the air.

For more details, read Court Challenges Subsidies, Threaten Obamacare and Halbig and King – a Simple Case of IRS Overreach

See our previous article regarding Hobby Lobby: Hobby Lobby Politics-Will The Brand Win or Lose?



Facebook Iconfacebook like buttonTwitter Icontwitter follow buttonVisit Our LinkedIN Profile