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Policy: Law

Court hands White House important win on Obamacare

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The Obama administration scored a major legal victory in the fight over the Affordable Care Act on Thursday before judges wrote a single word.

When the U.S. Court of Appeals for the D.C. Circuit agreed to hear a case on federal subsidies for insurance premiums under the law, it dramatically lessened the odds that the Supreme Court would take it up.

“Opponents of [Obamacare] have been desperate in moving to get this case before the Supreme Court, and with today’s ruling from the D.C. Circuit — and in the absence of any future split between the circuit courts — it is possible it will never get there," said Elizabeth Wydra, chief council of the liberal-leaning Constitutional Accountability Center.

Due to the broader liberal bent of the circuit court, which will decide the case en banc, it is likely that the judges will decide in favor of the administration.

That would mean that lower courts were not split, making it easy for the Supreme Court to simply punt and refuse to review the case.

The administration will face a friendly audience at the D.C. Circuit, where seven of 11 active judges were picked by Democratic presidents, including four Obama himself appointed.

The case centers on whether unclear wording in the statute means that the federal government cannot offer subsidies to people who sign up for insurance on the federal exchange.

Critics of the law argue that the subsidies were only supposed to apply to people receiving insurance from state exchanges. But its defenders say that was not discussed during the long debate over the law and the contested section was simply sloppy wording.

“We'll now see whether the D.C. Circuit will apply longstanding principles of statutory interpretation or will acquiesce to the administration's request that it be allowed to ignore the plain text of a duly enacted law,” said Jonathan Adler, a professor at Case Western Reserve University School of Law.

Eight million Americans who have purchased taxpayer-subsidized coverage under the law. The ruling affects consumers who bought coverage in the 36 states served by the federal insurance marketplace.

Bolstering the administration’s cause was a decision by another three-judge panel in July that sided with the administration on the same issue. The panel unanimously rejected a claim that the law provides the subsidies only to people who buy policies through state-run exchanges.

That court backed an Internal Revenue Service regulation that makes the subsidies available regardless of whether policies are purchased through state exchanges or one established by the federal government.

The D.C. Circuit is scheduled to rehear the case Dec. 17.

CORRECTION: Seven of the 11 active judges on the D.C. Court of Appeals were appointed by President Obama. That number was incorrect in an earlier version of this story. The Washington Examiner regrets the error.

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Sean Lengell

Congressional Correspondent
The Washington Examiner

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