News Update: ACA to continue subsidies as courts contradict each other

Despite a pair of dueling court rulings Tuesday — one that said people cannot use government tax breaks to buy health insurance through federally run Affordable Care Act marketplaces and one that said they can — proponents of the health care reform law said Mainers should not be concerned about losing their health insurance subsidies.

“This is one ruling by a court that had a couple of conservative, Republican-appointed judges, of the three judges who were considering it,” said Emily Brostek, associate director of Maine Consumers for Affordable Health Care. “This is just showing that this is nothing to panic about.”

Thirty-six states, including Maine, use a federal health insurance marketplace, also called an exchange, rather than state-run marketplaces. About 44,000 Mainers have bought health insurance through the federal marketplace and more than 39,000 have received subsidies.

Tuesday morning, the U.S. Court of Appeals for the District of Columbia Circuit ruled 2-1 that the Affordable Care Act, often called “Obamacare,” does not allow subsidies for insurance plans purchased through a federal marketplace.

“I think it means a lot of confusion for Maine and Mainers,” Brostek said immediately after that ruling. “People are going to be worried about losing the tax credits that made plans more affordable to them. But ultimately, these are political lawsuits brought to bear by opponents of the Affordable Care Act, and we’re confident they are ultimately going to fail.”


Two hours later, the Fourth Circuit Court of Appeals in Virginia made the opposite ruling. It said subsidies are allowed.

Experts say the D.C. Appeals Court decision is likely to be taken to the full appellate court there.

The issue could end up in front of the U.S. Supreme Court.

Trish Riley, a health care expert and former director of the Governor’s Office of Health Policy and Finance, agreed that Mainers should not panic about subsidies.

“Nobody should worry for one second about their coverage today or in the imminent future,” she said. “There are so many steps in the process. This thing stays intact until that process plays out.”

If the U.S. Supreme Court takes up the issue, it may not be until 2016.


Congress also has the power to amend the law — a move that some of its opponents in Maine welcome.

“I think if they’re going to do this, they really need to go back and take a comprehensive approach and really look at what are the unintended consequences, where is this law going wrong and fix it. Do away with it or fix it,” said Joel Allumbaugh, director of the Center for Health Reform Initiatives for the Maine Heritage Policy Center.

Gov. Paul LePage echoed the sentiment.

“First, the federal government forced people to buy health insurance,” LePage said in a statement. “Now, if this ruling holds up, these people would lose their federal subsidies to pay for that health insurance. Their premiums could skyrocket for plans that in some cases might be more expensive than their previous plans, which were canceled as a result of the law, making their health insurance unaffordable.”

He added, “This mess is just the latest example of what a disaster the Affordable Care Act is. I urge Mainers to call on those in Congress who voted for this scheme to get to work and fix this law immediately.”

Some in Maine were shocked by the D.C. Court of Appeals’ decision to strike down subsidies.


“I’m surprised by this decision because it is so inconsistent with the underlying purposes of the law, and I look forward to a review by the full panel,” independent U.S. Sen. Angus King said in a statement released Tuesday morning. “In the meantime, there are a number of us in the Senate who have been looking for bipartisan fixes to the ACA that will help cover even more Americans, and as we await a broader review of the decision, I think this is an opportunity for Congress to put aside partisan differences to solve problems that will impact millions around the country.”

The ruling didn’t surprise Maine Consumers for Affordable Health Care, a staunch proponent of the 2010 health care reform law and one of the groups that worked to get Mainers signed up for insurance through the marketplace.

“We expected that this case might come through this way,” Associate Director Emily Brostek said. “There are a couple of ideological judges sitting in that court, and so it wasn’t a surprise.”

A spokesman for the Maine Bureau of Insurance said the bureau is aware of both rulings and is reviewing them.

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