News

Court rejects challenge to Obamacare subsidies

Court rejects challenge to Obamacare subsidies

OBAMACARE: In his ruling, U.S. District Judge Paul Friedman wrote that Congress clearly intended to make the subsidies available nationwide under the new law. Photo: Reuters

By David Ingram

WASHINGTON (Reuters) – A federal judge on Wednesday rejected a conservative challenge to health insurance subsidies available to people in the 34 U.S. states that declined to establish their own online marketplaces under President Barack Obama’s healthcare law.

The suit, brought by individuals and businesses from Texas, Kansas, Missouri, Tennessee, West Virginia and Virginia, asserted that the wording of the 2010 law allowed subsidies to help people obtain insurance only in exchanges established by states, not those set up by the federal government.

In his ruling, U.S. District Judge Paul Friedman wrote that Congress clearly intended to make the subsidies available nationwide under the new law.

“There is evidence throughout the statute of Congress’s desire to ensure broad access to affordable health coverage,” the judge wrote.

Michael Carvin, a lawyer for those who brought the suit, filed a notice that he would appeal the ruling within an hour after it was posted online.

“This decision guts the choice made by a majority of the states to stay out of the exchange program,” Sam Kazman, another lawyer for the plaintiffs, said in a statement.

The law, dubbed Obamacare, aims to provide health coverage to millions of uninsured or under-insured Americans by offering private insurance at federally subsidized rates through new online health insurance marketplaces in all 50 states and in Washington, D.C.

Only 14 states opted to create and operate their own exchanges, leaving the Obama administration to operate a federal marketplace for the remaining 36 states that can be accessed through HealthCare.gov.

The exchanges were launched last October.

A spokeswoman for the Justice Department, which is defending the law, said officials were pleased with the decision.

The subsidies, in the form of tax credits, are a key part of the healthcare overhaul. They are available to people with annual incomes of up to 400 percent of the federal poverty level, or $94,200 for a family of four.

The case is Halbig v. Sebelius, U.S. District Court for the District of Columbia, No. 1:13-cv-623.

(Editing by Lisa Von Ahn and Will Dunham)

Recent Headlines

3 hours ago in National

Takata recall could more than double in size

takata16125303396828

Tens of millions of air bag inflators could be added to what is already the biggest auto recall in American history.

4 hours ago in Sports

Deflategate: Brady gets more time

tombrady276076991807

Lawyers for the New England Patriots quarterback have been given another two weeks to appeal his "Deflategate" suspension.

4 hours ago in Sports

Kentucky Bourbon Trail offers a lesson for reviving racing’s fans

derby16124571363511

Some of the best-known farms in Kentucky's scenic horse country are borrowing from another of the state's contributions to the good life — bourbon whiskey distilleries — in an effort to win new recruits to an aging and shrinking fan base.

4 hours ago in National

School safety: Drops in bullying, violent crime on campus

schoolsafety16124794280762

The latest government snapshot of school crime paints a picture of safer schools, with declines in violent crime, bullying and harassment because of sexual orientation.

5 hours ago in National, World

U.S. gathers allies on next steps in Islamic State fight

isisREUTERS

The United States gathered defense ministers from 11 other countries for talks on Wednesday about ways to strengthen the campaign against Islamic State, a day after a U.S. Navy SEAL was killed in Iraq during an attack by the militant group.