Last week, two circuit courts
split over legal challenges to the Obama administration’s decision
to allow subsidies in federally run exchanges under Obamacare.
A three judge panel in the D.C. Circuit ruled that the
administration’s implementation, authorized by an Internal Revenue
Service rule, was illegal. A separate three judge panel from the
Fourth Circuit ruled that the administration’s approach was
allowable under the law.
The challengers who lost in the Fourth Circuit have now appealed
directly to the Supreme Court, asking the high court to resolve the
issue as quickly as possible.
The petition,
from the Competitive Enterprise Institute (CEI), which is
coordinating the challenges, lays out the central question and the
stakes involved:
Two Courts of Appeals have squarely divided over its facial
validity. The resulting uncertainty over this major plank
of ACA implementation means that millions of people have
no idea if they may rely on the IRS’s promise to subsidize
their health coverage, or if that money will be clawed back.
Employers in 36 states have no idea if they will be penalized
under the ACA’s employer mandate, or are effectively exempt
from it. Insurers have no idea if their customers will pay for
health coverage in which they enrolled, or if large
numbers will default. And the Treasury has no idea if billions
of dollars being spent each month were authorized by Congress,
or if these expenditures are illegal. Only this Court can
definitively resolve the matter; it is imperative that the
Court do so as soon as possible.
The high court is under no obligation to hear the case, but will
do so if four justices decide to grant certification. Challengers
hope that the Supreme Court will agree to hear the case as soon as
possible. If the court does hear the case, a decision could come as
early as next spring.
(Disclosure: I worked at CEI from summer 2005 through early
2007.)
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