Federal Court Rules That Obamacare Subsidies Were Illegally Funded
12th May 2016
A federal judge ruled today that the Obama administration has been implementing Obamacare illegally, paying out billions in subsidies to insurers that aren’t authorized under the law.
The lawsuit, led by House Republicans, argued that the administration had no authority to fund law’s cost-sharing reductions, which provide an additional subsidy to people who earn up to 250 percent of the poverty line, which ended up being a little more than half of people enrolled in coverage through the health law’s exchanges. (The cost-sharing subsidies are distinct from the law’s main insurance subsidies, which cover a portion of the cost of insurance coverage for people up to 400 percent of the poverty line.)
The subsidies were authorized by the law, but Congress rejected an appropriations request from the administration to fund them. The administration moved some money around and funded them anyway. Estimates indicate that the program would funnel about $130 billion to insurers over the course of a decade.
Of course, the Crust will find a way around this temporary bump in the road. But it will be entertaining to see what form the necessary wiggle-dance will take.
It’s pretty sad when a political system degenerates into sophistry as a spectator sport — but that’s all we’ve got, so we’d better enjoy it.