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Policy: Law

Obama administration asks full D.C. Circuit to revisit Halbig decision

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Beltway Confidential,Opinion,Philip Klein,Obamacare,Supreme Court,Appeals Courts,Health Care,IRS,Law,Halbig v. Burwell

On Friday, the Obama administration asked the full U.S. Court of Appeals for the D.C. Circuit to rehear a case concerning the health care law's subsidies to federal exchanges, after a panel on the court sided with challengers last month.

At issue in the case, Halbig v. Burwell, are the subsidies that the federal government provides for individuals purchasing insurance through Obamacare. Though the text of the law says the subsidies were to go to individuals obtaining insurance through an “exchange established by the state,” a rule released by the Internal Revenue Service subsequently instructed that subsidies would also apply to exchanges set up on behalf of states by the federal government.

On July 22, two federal appeals courts issued contradictory rulings on the whether this rule was legal.

In the Halbig case, two of three judges on a D.C. Circuit panel sided with the challengers.

But challengers in the similar case, King v. Burwell, received an adverse ruling before the Fourth Circuit Court of Appeals and have asked the Supreme Court to weigh in as soon as possible.

Obama administration lawyers have now formally asked the whole D.C. Circuit to rehear the case, a scenario in which they expect to fare better. Senate Majority Leader Harry Reid's recent deployment of the nuclear option to confirm Obama's nominees to the court tilted the balance toward Democratic-appointed judges.

It is far from assured that the the full court will take up the case in what's known as an en banc hearing. But should the court do so, Obama's legal team would likely ask the Supreme Court to await such a decision before deciding whether to take up the case. And if the D.C. Circuit reversed the panel, it would eliminate the split among the appellate courts and perhaps take pressure off of the Supreme Court to take up the case.

Ultimately, however, if four Supreme Court justices want to tackle the issue, they have the ability to take the case regardless of what's going on at the D.C. Circuit.

Click here to read the administration's petition for a rehearing.

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