Could today’s Halbig decision topple ObamaCare?

The U.S. Court of Appeals for the D.C. Circuit Court has ruled today that the Internal Revenue Service does not have the ability to circumvent the original intent of the Affordable Care Act and provide insurance subsidies or impose individual and employer penalties in a state that has not created its own ObamaCare health-insurance exchange....

The U.S. Court of Appeals for the D.C. Circuit Court has ruled today that the Internal Revenue Service does not have the ability to circumvent the original intent of the Affordable Care Act and provide insurance subsidies or impose individual and employer penalties in a state that has not created its own ObamaCare health-insurance exchange.

Today’s Halbig ruling does not completely undo ObamaCare. It does, however, limit the law’s implementation in states that did not establish state-based health-insurance exchanges. By forcing the administration to implement the law as it was written, subsidies would only flow into the 14 states that established a state ObamaCare exchange.

The case came down to the text of Section 1401 of the Affordable Care Act. Even though the text of the law states that the ObamaCare subsidies are available “through an Exchange established by the State under 1311 of the Patient Protection and Affordable Care Act,” the IRS acted illegally and without congressional authorization when it implemented the law by allowing federal subsidies to flow into states participating in the federal exchange, according to the legal challenge.

This case is of particular importance for Illinois, since the state did not establish its own state-based insurance exchange. The importance of this case was summed up in a Newsweek article titled, “The Case That Could Topple Obamacare”:

“At issue are the federal subsidies for individuals buying insurance in their state’s health care exchanges. The law stipulates that those subsidies should be
allotted for plans purchased ‘through an Exchange established by the State under Section 1311’ (italics added), a reference to the section of the law that establishes state-run exchanges …

“It may seem like a small problem, but if true, it spells disaster for the Affordable Care Act. Without subsidies, health care on the individual market becomes unaffordable. Without an affordable option, the individual and employer mandates disappear. In other words, the entire law could come crashing down in the 36 states that have opted not to run their own exchanges.”

Congressional lawmakers, as well as state lawmakers in the 36 states that did not establish a state-based exchange, now have an opportunity to pass meaningful health reform in a way that respects taxpayers, provides for the truly needy and addresses health-care costs – delivering on the ObamaCare promises that never materialized.