ACA trouble. Appeals court rules subsidies illegal

[Fermion]

Have not really thought through the implications of this. I assume it will go quickly to the Supreme court?

http://finance.yahoo.com/news/appeals-court-most-obamacare-subsidies-142125125.html

 

[MichaelB]

A snippet would be helpful

A judicial panel in a 2-1 ruling said such subsidies can be granted only to those people who bought insurance in an Obamacare exchange run by an individual state or the District of Columbia - not on the federally run exchange HealthCare.gov.

 

[2B]

I agree this is going to SCOTUS quickly. I expect there to be a stay to prevent stopping the existing subsidies (pure speculation). This is an interesting legal question. The intent was certainly not reflected in the actual language of the bill. So, what's a law? What we'd like or what it says?

 

[Fermion]

The reason it interests me is we are going to be ER next year and will have to choose a state to call home (selling home, travelling in a RV).

I am somewhat heavily depending on a decent ACA subsidy. I am sure this gets resolved before next year but could affect the decision of which state to choose.

 

[marko]

Might this set of a migration? Those who don't want to pay for HC swapping states with those looking for subsidies?

 

[Fermion]

Might this set of a migration? Those who don't want to pay for HC swapping states with those looking for subsidies?

The list of states that use the federal exchange is huge though.

I was thinking Florida or Texas for us, and both use the fed exchange.

Alabama
Alaska
Arizona
Arkansas
Delaware
Florida
Georgia
Illinois
Indiana
Iowa
Kansas
Louisiana
Maine
Michigan
Mississippi
Missouri
Montana
Nebraska
New Hampshire
New Jersey
North Carolina
North Dakota
Ohio
Oklahoma
Pennsylvania
South Carolina
South Dakota
Tennessee
Texas
Virginia
West Virginia
Wisconsin
Wyoming

 

[2B]

The reason it interests me is we are going to be ER next year and will have to choose a state to call home (selling home, travelling in a RV).

I am somewhat heavily depending on a decent ACA subsidy. I am sure this gets resolved before next year but could affect the decision of which state to choose.

I suspect that there will be a move to put a state portal face on the federal exchange and call that the state exchange. The question is whether all the states will go along with it.

Right now all health insurance is "local" in that rates are determined by the plan and zip code.

From the earliest days of the ACA, I've wondered why any state would bother to spend millions upon millions of dollars on a state portal since the Feds were going to create a national exchange anyway. This subsidy phrasing was a reason I wasn't aware of but it seems more like an issue with the language than intent.

 

[RockyMtn]

From the earliest days of the ACA, I've wondered why any state would bother to spend millions upon millions of dollars on a state portal since the Feds were going to create a national exchange anyway. This subsidy phrasing was a reason I wasn't aware of but it seems more like an issue with the language than intent.

+1

Oregon spent a ton of money for their site. It didn't work. Now they are switching to the fed site. Another example our government at work.

 

[misanman]

Seems like I remember a representative (was it Nancy Pelosi?) who said something to the effect that "We need to get this passed - we can figure out what's in it later".

 

[samclem]

This subsidy phrasing was a reason I wasn't aware of but it seems more like an issue with the language than intent.

The language is very clear, and it appears in many places. The subsidies are for state-run exchanges. The intent is up for debate, but I have read that the intent was to "encourage" states to establish these exchanges. If a state didn't establish an exchange, the feds would do it and the residents of that state would get no subsidies, thus building political pressure on these states to go along with the plan.

I agree that, if the SCOTUS eventually rules that the subsidies can only go to state-run exchanges, there will be some way found by many states and the feds to meet the letter of the law with minimal investment and minimal real change.

 

[daylatedollarshort]

I suspect that there will be a move to put a state portal face on the federal exchange and call that the state exchange. The question is whether all the states will go along with it.

Yes, in states that go along with it, problem solved. They put their own front end on it just like making minor customizations and having an interface team in charge of a SAP application.

In resistant states, there will be a lot of political pressure to do the same just like they are under heavy pressure from local businesses, poor advocates and the medical community to expand Medicaid in the states that have not.

 

[FIRE'd@51]

Seems like I remember a representative (was it Nancy Pelosi?) who said something to the effect that "We need to get this passed - we can figure out what's in it later".

Not just a representative, but the Speaker of the House. This appears to be yet one more example of how carelessly this law was crafted.

 

[Chuckanut]

+1

Oregon spent a ton of money for their site. It didn't work. Now they are switching to the fed site. Another example our government at work.

No doubt about it. Oregon squandered millions on a failed state software system.

But......

Just north of Oregon, Washington built their own site. It had some start up problems also but not nearly as bad as Oregon's. The Washington site is currently working well for the vast majority of citizens. Another example of our government at work.

A study of what the difference were between these two similar states might be very enlightening.

 

[Chuckanut]

Agreed, the law is a mess and probably a lawyer's meal ticket for years to come. IMHO, the only thing worse was the situation we had before the law was passed. Anybody who can come up with a better way to fairly provide Americans with the health care they need will win a lot of votes, IMHO. (Hint, Hint to certain groups.)

 

[HFWR]

This appears to be yet one more example of how carelessly this law was crafted.

I haven't paid much attention to all this, because, so far at least, it hasn't directly affected either my employer-provided or my previous employer's retiree HI. With any law this "big", there are bound to be unintended consequences. But much of the law came from previous proposals, from both sides of the aisle, and from "Romney-Care" (not meant to be political; I don't know what the official name is...).

It will likely evolve, or maybe even be rescinded, so stay tuned...

 

[Mo Money]

Well, I am going full-steam ahead with my 2015 ER. It's a ruling that's scary for me, here in PA, where there's a federally run exchange. If there are no subsidies, then some news reports (and common sense) suggest that the premiums will skyrocket for those non-subsidized insureds who remain -- like me. I will move. Massachusetts is looking a lot more inviting right now....

 

[2B]

Agreed, the law is a mess and probably a lawyer's meal ticket for years to come. IMHO, the only thing worse was the situation we had before the law was passed. Anybody who can come up with a better way to fairly provide Americans with the health care they need will win a lot of votes, IMHO. (Hint, Hint to certain groups.)

This will quickly bring Porky. It's always a debate as to whether the ACA improved things or not. Then there is the question of what is "fair." I won't wander into the discussion and suggest all others do the same.

Let's focus on the possible impact of finances.

 

[2B]

Well, I am going full-steam ahead with my 2015 ER. It's a ruling that's scary for me, here in PA, where there's a federally run exchange. If there are no subsidies, then some news reports (and common sense) suggest that the premiums will skyrocket for those non-subsidized insureds who remain -- like me. I will move. Massachusetts is looking a lot more inviting right now....

It has no impact on my plans unless somehow the ACA totally collapses and Texas doesn't reinstitute their High Risk Plan. I ran the numbers on suppressing taxable income versus doing Roth conversions. Overall, I'm better off financially to move money from my IRA to a Roth prior to Medicare.

 

[Mo Money]

Somebody at some point is going to have to clue me in on the "Porky" moniker. Why do you folks call the moderator "Porky"? (Unfortunately, that's the only thing that's funny in connection with the discussion on this DC Circuit ruling....)

 

[HFWR]

Somebody at some point is going to have to clue me in on the "Porky" moniker. Why do you folks call the moderator "Porky"? (Unfortunately, that's the only thing that's funny in connection with the discussion on this DC Circuit ruling....)

Ha! If you'll remember Porky the Pig of cartoon fame, saying "That's all folks", an oft used ending to threads that have strayed into political territory...

 

[2B]

Somebody at some point is going to have to clue me in on the "Porky" moniker. Why do you folks call the moderator "Porky"? (Unfortunately, that's the only thing that's funny in connection with the discussion on this DC Circuit ruling....)

When our moderators close a thread, it's traditional to include a little cartoon clip. Porky Pig says "That's all folks!" It's probably a dated reference. I doubt my kids would recognize the reference.

 

[Fermion]

If Porky shuts down one of the single most important topics for many early retirees (pre Medicare) then Porky should just shut down ER.org.

 

[Sue J]

Right after that ruling, another ruling by the Fourth Circuit Court of Appeals -

http://www.vox.com/2014/7/22/592675...es-in-favor-of-obamacare-subsidies/in/5690430

This one rules that subsidies could be offered through the federal exchanges. Two rulings, coincidentally, on the same day.


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[PERSonalTime]

Well, I am going full-steam ahead with my 2015 ER. It's a ruling that's scary for me, here in PA, where there's a federally run exchange. If there are no subsidies, then some news reports (and common sense) suggest that the premiums will skyrocket for those non-subsidized insureds who remain -- like me. I will move. Massachusetts is looking a lot more inviting right now....

Sue J is right. Nothing is going to change anytime soon. This was a 2-1 ruling by one Appeals Court. It's my understand that the 4th Circuit Appeals Court rendered an opposite ruling indicating that the Federal subsidies are legal. The Supreme Court will have to decide this matter, but it won't be anytime soon.

 

[2B]

Right after that ruling, another ruling by the Fourth Circuit Court of Appeals -

Separate circuit court rules in favor of Obamacare subsidies - Vox

This one rules that subsidies could be offered through the federal exchanges. Two rulings, coincidentally, on the same day.


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I'm not so sure it was a total coincidence. The 4th Circuit in Richmond is generally considered "liberal" but then so is the DC court. The DC court has had additional members added to make it also be a reliable "liberal" leaning court. I think both of these rulings were 3 judge panels so the full circuit court can rehear the appeal. That heavily favors the ACA subsidies being upheld. This can still be appealed to SCOTUS; but without a conflicting set of rulings by the Appeals courts, SCOTUS could take a pass. This allows the Appeals courts to remain in force. I do think that SCOTUS will eventually get involved if for no other reason that with a 5-4 "conservative" leaning I suspect they want to go on the record even if they will only uphold the Appeals courts rulings.