Although to many people Obamacare seems like settled law and the vast majority of the people insured under the Affordable Care Act are extremely happy, the far right isn’t willing to admit their loss yet, and continue to look for ways to undermine it. Now, new life has been breathed into their efforts after a three judge D.C. circuit panel has ruled that the government cannot offer tax breaks for those who bought insurance under the federal exchange, a decision that could drastically drive up the cost of premiums for many in the country.
When the states were ordered to set up their own exchanges so people could purchase insurance, only about one third of them agreed to do so. The others either completely or partially opted out, leaving their residents to use the federal exchange instead. Now, a panel at the D.C. appeals court has stated that since the law explicitly says that there are taxpayer subsidies available to those who purchase a plan on a state exchange, in those states where no exchange was created those who bought insurance on the federal exchange technically should not be eligible for subsidies.
The ruling in itself is petty. The states that refused to set up exchanges did so because they were run by GOP governors hoping to torpedo the ACA and keep it from going into effect. That the federal exchange then picked up the slack and provided an opportunity for the uninsured in their states to still obtain coverage regardless of pre-existing conditions, as well as tap into some of the taxpayer subsidies was a small band-aid for the uninsured in those Republican states, especially since they also refused the Medicaid expansion that would make coverage more affordable.
Much like the refusal to expand Medicaid (which would cost the states nothing and would allow a multitude of people to better afford their coverage), the battle over subsidies is just another rightwing ploy to doom the ACA by making it too expensive for people to participate in. Their overall goal is to use the resentment they hope to foster to propel themselves into more offices, translating the anger of those who can’t afford insurance into votes in November, believing that they can somehow convince those voters that it was the Democrats — not the GOP — who gave them massively expensive premiums.
Luckily, those who are taking advantage of the subsidies are unlikely to be affected, at least, not yet. The White House is asking for a full circuit hearing, arguing that a state exchange is a state exchange, regardless of whether it is the state or the federal government actually running it, an argument which a separate circuit appeals upheld the same day the D.C. panel ruled the opposite.
“If I ask for pizza from Pizza Hut for lunch but clarify that I would be fine with a pizza from Domino’s, and I then specify that I want ham and pepperoni on my pizza from Pizza Hut, my friend who returns from Domino’s with a ham and pepperoni pizza has still complied with a literal construction of my lunch order,” said a 4th Circuit judge who believes the subsidies should apply to all states.
It is unlikely that the subsidies will be stripped while the law is still being argued, and a full panel review may have a different outcome. If not, a trip up the the Supreme Court may be necessary for final arbitration.
Pundits on the right are declaring this ruling the “beginning of the end of Obamacare,” a claim that seems seriously overblown. But if it somehow does come to this, and we start all over with health care reform in a new bill that applies to all states, that would be an excellent opportunity to undo some of the flaws in our current system.
With a real single payer system or Medicaid for all, and an elimination of insurance being provided by employers, all people will be able to afford quality insurance regardless of which state they live in, who is the governor, and if he or she is trying to block Medicaid expansion or subsidies. We could also remove an employer’s ability to block portions of coverage in a person’s health insurance due to alleged religious objections. And, since that removes all of the responsibility from the states as well as allows employers to avoid religious conflict, it should be something that all politicians can agree on, regardless of their party IDs.
It is unlikely that the taxpayer subsidies will get stripped from those who are on the federal exchange, nor that Obamacare will unravel as a result of the continuing onslaught of tactics to undermine it. If it does, however, maybe we can use that as an excuse to create something even better.
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