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Appeals Courts Issue Conflicting Decisions Regarding Health Care Exchange Subsidies Under the ACA

July 23, 2014 | No Comments
Posted by Beth Christian

Yesterday, two different federal appeals courts issued conflicting decisions regarding the provision of premium subsidies under the Affordable Care Act to individuals who access health insurance coverage in states that use the federal exchange.  A three judge panel of the U.S. Court of Appeals for the D.C. Circuit ruled that language of the Affordable Care Act  unambiguously restricted the subsidies to insurance purchased on exchanges “established by the State,” and vacated an IRS regulation which had extended the subsidies to insurance purchased through the federal exchange.  Several hours later, the U.S. District Court for the Fourth Circuit issued a decision which reached the opposite conclusion concerning the validity of the IRS regulation, finding that the regulation constituted a “permissible exercise of the agency’s discretion.  These two important rulings create a conflict between two federal appeals courts, and are likely to lead to a review of the issue by the United States Supreme Court.

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