For the last three years, Michael Carvin of Jones Day and other conservative advocates have laid the groundwork for a constitutional challenge to the subsidies at the heart of the Affordable Care Act. Their campaign has been partly eclipsed in the media by cases like Hobby Lobby v. Burwell. But on Tuesday it shot to the forefront of the fight over Obamacare in a big way.
In a 2-1 decision in Halbig v. Burwell, the U.S. Court of Appeals for the D.C. Circuit ruled that the government can’t offer subsidies in the form of tax credits to individuals who buy health insurance on federally facilitated exchanges. Reversing the lower court, the majority found that the plain language of the ACA suggests Congress only authorized tax credits for insurance purchased on state-run exchanges. Only 14 states and the District of Columbia have implemented their own exchanges, so the ruling threatens subsidies that make health insurance under the ACA affordable to citizens of 36 states.
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