Judge Shoots Down Anti-Obamacare Suit

The lawsuit would have crippled the health care law.

Obamacare supporters react to the U.S. Supreme Court decision to uphold President Obama's health care law, on June 28, 2012 in Washington, DC. Today the high court upheld the whole healthcare law of the Obama Administration.
National Journal
Sam Baker
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Sam Baker
Jan. 15, 2014, 7:43 a.m.

A fed­er­al judge tossed out a law­suit today that sought to cripple Obama­care.

The suit — a chal­lenge to the law’s in­sur­ance sub­sidies — was a long shot but had the po­ten­tial to dev­ast­ate the health care law if it suc­ceeded. It would have blocked the law’s in­sur­ance sub­sidies — the main in­cent­ive for people to buy in­sur­ance — in 36 states.

The U.S. Dis­trict Court for the Dis­trict of Columbia ruled that the sub­sidies, which help low-in­come con­sumers cov­er their premi­ums, should be avail­able in all 50 states. He dis­missed a law­suit, filed by a group of in­di­vidu­als and busi­nesses, that sought to block sub­sidies in any state that didn’t op­er­ate its own in­sur­ance ex­change,

“The plain text of the stat­ute, the stat­utory struc­ture, and the stat­utory pur­pose make clear that Con­gress in­ten­ded to make premi­um tax cred­its avail­able on both state-run and fed­er­ally fa­cil­it­ated Ex­changes,” Judge Paul Fried­man wrote.

Chal­lengers ar­gued that Con­gress in­ten­ded for tax sub­sidies to flow only through state-run ex­changes, be­cause it wanted to en­cour­age states to set up their own mar­ket­places. The Justice De­part­ment ar­gued that the over­all goal of the Af­ford­able Care Act was to ex­pand cov­er­age in all 50 states, and that fed­er­al ex­changes were de­signed to stand in for state-run mar­ket­places.

Fried­man agreed with the Justice De­part­ment, say­ing the chal­lengers’ ar­gu­ment does not “make in­tu­it­ive sense,” and that “there is no evid­ence in the le­gis­lat­ive re­cord that the House, the Sen­ate, any rel­ev­ant com­mit­tee of either House, or any le­gis­lat­or ever en­ter­tained this idea.”

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