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Federal Court rules Most obamacare subsidies Illegal[W:286]

jmotivator said:
Nope. The only section that you quote that incorporates BOTH 1311 and 1321 is in regard to data reporting requirements to the IRS from the exchanges. This does not prove anything because there are other reasons why the IRS would collect that data not related to subsidies.

More important, while the Tax code makes it clear that BOTH 1311 and 1321 exchanges must report insurance data to the IRS, the Subsidy section only mentions 1311. The the IRS is quite clear in differentiating the two.

So you are the one who appears confused.
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I'll add this argument of yours to the list of things you've gotten wrong
 
sangha said:
I'll add this argument of yours to the list of things you've gotten wrong
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Hah, yeah. You try to prove subsidies are intended for both exchange types by quoting tax code for data reporting requirements. Not the most brilliant play, chief.
 
jmotivator said:
Hah, yeah. You try to prove subsidies are intended for both exchange types by quoting tax code for data reporting requirements. Not the most brilliant play, chief.
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Seeing how the people making the argument won the trial, it obviously was a brilliant play
 
ludin said:
Fed appeals court panel says most Obamacare subsidies illegal

The ruling just came in and is a huge blow to the obama administration.
The 3 judge panel ruled that only people on state run exchanges qualified per the law.

This could pretty much end obamacare as we know if it the SCOTUS rules the same way.
the administration of course will appeal.
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Samhain said:
The ruling makes sense given that the government used the definition of "state" to mean actual states so as to exclude US Territories from the law.

Can't say that "state" means a state on one hand and "state" to be "government" on the other.
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ludin said:
If this ruling stands which many think it will then millions are going to have their subsidies go up even more.
however given that there are 0 subsidies to be given then they can get out of the law all together and so can their employer.

it would set 36 states free of obamacare.
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When I first learned of the conflicting ruling between the DC Appellate Court and the Fourth District Court of Appeals, I went back and research the PPACA reviewing those provisions of the law that applied to the States creating their health insurance exchanges (Sections 1311-1313) and the tax credits that would apply (Sections 1401, 1411, 1413 and 1415). When I read these sections, I interpreted the meaning of the word "State(s)" to mean the same as it would mean in the 10 Amendment to the Constitution - all 50 State - which is the same way I'm sure pretty much everyone else would interpret "the State(s)" would mean in this case. Cut and dry, right? Not quite. You have to read Sections 1311 and 1321(c)91)(B) very carefully. The Secretary of HHS does have lots of leeway in setting up Exchanges in those states who don't establish them AND in issuing tax credits for those who qualify. (Mostly those who purchase Silver plans, Section 1331(a)(2)(A)) There's also the Healthcare Reconciliation Act that according to the below linked article attempts to clarify any vagueness on this matter. I admit I haven't read the provision(s) that apply from the HCRA because last time I read it, it mostly dealt with funding education initiatives in the medical fields (i.e., doctors, nurse practitioners and nurses).

I found this article that does a very good job of explaining the situation (or should I say "did" considering that article was first written in 2012 in anticipation of a lawsuit on this very tax credit issue).

Tax Credits In Federally Facilitated Exchanges Are Consistent With The Affordable Care Act’s Language And History – Health Affairs Blog

Regardless, this issue may well need to be settled by the SCOUS.
 
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sangha said:
Seeing how the people making the argument won the trial, it obviously was a brilliant play
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So you want to just pretend that today's developments didn't actually happen? I guess I know why...
 
Objective Voice said:
When I first learned of the conflicting ruling between the DC Appellate Court and the Fourth District Court of Appeals, I went back and research the PPACA reviewing those provisions of the law that applied to the States creating their health insurance exchanges (Sections 1311-1313) and the tax credits that would apply (Sections 1401, 1411, 1413 and 1415). When I read these sections, I interpreted the meaning of the word "State(s)" to mean the same as it would mean in the 10 Amendment to the Constitution - all 50 State - which is the same way I'm sure pretty much everyone else would interpret "the State(s)" would mean in this case. Cut and dry, right? Not quite. You have to read Sections 1311 and 1321(c)91)(B) very carefully. The Secretary of HHS does have lots of leeway in setting up Exchanges in those states who don't establish them AND in issuing tax credits for those who qualify. (Mostly those who purchase Silver plans, Section 1331(a)(2)(A)) There's also the Healthcare Reconciliation Act that according to the below linked article attempts to clarify any vagueness on this matter. I admit I haven't read the provision(s) that apply from the HCRA because last time I read it, it mostly dealt with funding education initiatives in the medical fields (i.e., doctors, nurse practitioners and nurses).

I found this article that does a very good job of explaining the situation (or should I say "did" considering that article was first written in 2012 in anticipation of a lawsuit on this very tax credit issue).

Tax Credits In Federally Facilitated Exchanges Are Consistent With The Affordable Care Act’s Language And History – Health Affairs Blog

Regardless, this issue may well need to be settled by the SCOUS.
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This might have been the case until recently when the HHS just excempted the US territories from the law. they didn't think they could, but they did and they defined States to mean the actual States and not any other form of government.

that point will need to be argued in from of the DC full court and the SCOTUS because that is were it is going.

the government just shot itself in the head on this issue by excempting the terrirtories from obamacare. by doing so they can no longer claim that States includes the federal government. which the federal government isn't a state.
 
ludin said:
This might have been the case until recently when the HHS just excempted the US territories from the law. they didn't think they could, but they did and they defined States to mean the actual States and not any other form of government.

that point will need to be argued in from of the DC full court and the SCOTUS because that is were it is going.

the government just shot itself in the head on this issue by excempting the terrirtories from obamacare. by doing so they can no longer claim that States includes the federal government. which the federal government isn't a state.
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In this, you may have a very valid point. Do you have a link to the exemption on U.S. Territories from participating in ObamaCare? I'd like to read it.
 
ludin said:
evidently that is how the appeals court saw it as well. they full said that the federal exchanges are not the state exchanges and nor could they represent the states either.
that the law written the way that it was clearly meant that the subsidies were to inspire states to make their own exchanges.

that it didn't include the federal exchanges.
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The Medicaid block grants to the States (which the SCOUS struck down as "coercion") was the carrot. It was intended to ease the financial burden on the States so that they could more easily afford "their fair share" for expanding Medicaid within the respective States (which as most people are aware is a jointly funded insurance program between the States and the federal government using matching funds from the fed to pay Medicaid expenses as outlined by the States). The health insurance tax credits were to further incentivize the States to establish Health Insurance Exchanges by a specific deadline. Those States that opted out AND refused to expand Medicaid knew they were setting federal dollars on the sidelines, BUT...they also knew that if they couldn't afford to fund their own state-sponsored HIE, they were more than willing to allow the fed to come in and run them for them. This is were Sections 1311 and 1321 come into play.

So, for me the question really becomes this: What level insurance plans are being offered through the federal HIE's? Does anyone know? If silver and above, there is no conflict here.
 
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LowDown said:
I'm convinced that the ruling you cite is correct. Section 1321 of the ACA clearly authorizes the creation of federal exchanges, and so it could not have been the intent of the law to exclude the federal exchanges from subsidies regardless of the language of section 1311.
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Again, it depends...

Using the combined "affordability" of Medicaid (expansion) and standard (Bronze) insurance plans purchased even on the federal exchange, these plans were suppose to be made extremely affordable as they are marketed primarily to the poor. Silver plans are suppose to be intended for mid- and upper-middle class wage earners, folks who were employed full-time but their employer's insurance plan might be alittle on the pricy side OR might not provide full coverage per the essential benefits under ObamaCare as outlined. It's these clients who would most likely receive the health insurance tax credit. Those who purchase Gold or Platinum plans ("Cadillac" plans) wouldn't need financial assistance; they can afford to buy insurance on the individual market if they wanted.

So, the question once again is what level of insurance is offered through the federal exchange? Does anyone know?
 
Objective Voice said:
Again, it depends...

Using the combined "affordability" of Medicaid (expansion) and standard (Bronze) insurance plans purchased even on the federal exchange, these plans were suppose to be made extremely affordable as they are marketed primarily to the poor. Silver plans are suppose to be intended for mid- and upper-middle class wage earners, folks who were employed full-time but their employer's insurance plan might be alittle on the pricy side OR might not provide full coverage per the essential benefits under ObamaCare as outlined. It's these clients who would most likely receive the health insurance tax credit. Those who purchase Gold or Platinum plans ("Cadillac" plans) wouldn't need financial assistance; they can afford to buy insurance on the individual market if they wanted.

So, the question once again is what level of insurance is offered through the federal exchange? Does anyone know?
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The idea that a lot of people have is that the federal exchanges would be the same, but information is coming out that indicates that this was not the intent. In other words, subsidies would be withheld from federal exchanges as an incentive for states to establish exchanges, and federal exchanges would be a lessor, fall-back position. So, there is a strong case upholding the DC panel's opinion.
 
ludin said:
Fed appeals court panel says most Obamacare subsidies illegal

The ruling just came in and is a huge blow to the obama administration.
The 3 judge panel ruled that only people on state run exchanges qualified per the law.

This could pretty much end obamacare as we know if it the SCOTUS rules the same way.
the administration of course will appeal.
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Of course they're illegal....... Obama has no concept of law whatsoever..

Almost ever piece of legislation Obama has coerced out of congress has been illegal...

This is what you get when you vote people into office based on aesthetics and "do good" but illegal talk...

Then again your typical democrat doesn't know what's legal and what's not anyways - that's why they actually believe redistribution of wealth is a swell thing - when in reality it's nothing more than stealing...
 
LowDown said:
The idea that a lot of people have is that the federal exchanges would be the same, but information is coming out that indicates that this was not the intent. In other words, subsidies would be withheld from federal exchanges as an incentive for states to establish exchanges, and federal exchanges would be a lessor, fall-back position. So, there is a strong case upholding the DC panel's opinion.
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That's exactly the intent... as stated by Gruber on at least two occasions so far found.
 
LowDown said:
The idea that a lot of people have is that the federal exchanges would be the same, but information is coming out that indicates that this was not the intent. In other words, subsidies would be withheld from federal exchanges as an incentive for states to establish exchanges, and federal exchanges would be a lessor, fall-back position. So, there is a strong case upholding the DC panel's opinion.
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I'm leaning in that direction myself based on my reading of the law. It's pretty clear to me that where States met the deadline to establish an Exchange, the federal tax subsidy would go to them. But if a State didn't establish an Exchange and instead let the fed do it, those States would either expand Medicaid to cover more poor residents OR applicants from those States would be steered toward an insurance plan on the federal exchange that best met their needs according to what they could afford. Thus, if you couldn't afford even the standard (Bronze) plan, you were pushed to sign up for Medicaid in your State. If you could only afford the Bronze plan, that's what you were steered towards. And the Silver plan, Gold or Platinum....each according to their need based on what they could afford.

While I'm sure the fed had hoped the States would play along more, I believe the DC Court got it right despite what Congressional legislators might have intended.
 
Objective Voice said:
In this, you may have a very valid point. Do you have a link to the exemption on U.S. Territories from participating in ObamaCare? I'd like to read it.
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I found it. Read the DHHS letter here. Seems DHHS used both the broad and narrow views to define "State" under applicable laws:

Broad view = Public Health Services Act (All 50 States, U.S. Territories and federal government)

Narrow view = PPACA, Title I (All 50 U.S. States-only)

From my read, it doesn't appear that the U.S. Territories have been exempt from the law itself, just that insurance carriers are exempt from having to manage their insurance markets in the same way as the continental U.S. I'll have to study this one alittle more to dissect and digest it.
 
Objective Voice said:
The Medicaid block grants to the States (which the SCOUS struck down as "coercion") was the carrot. It was intended to ease the financial burden on the States so that they could more easily afford "their fair share" for expanding Medicaid within the respective States (which as most people are aware is a jointly funded insurance program between the States and the federal government using matching funds from the fed to pay Medicaid expenses as outlined by the States). The health insurance tax credits were to further incentivize the States to establish Health Insurance Exchanges by a specific deadline. Those States that opted out AND refused to expand Medicaid knew they were setting federal dollars on the sidelines, BUT...they also knew that if they couldn't afford to fund their own state-sponsored HIE, they were more than willing to allow the fed to come in and run them for them. This is were Sections 1311 and 1321 come into play.

So, for me the question really becomes this: What level insurance plans are being offered through the federal HIE's? Does anyone know? If silver and above, there is no conflict here.
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the same levels as in the state exchanges
 
Objective Voice said:
Again, it depends...

Using the combined "affordability" of Medicaid (expansion) and standard (Bronze) insurance plans purchased even on the federal exchange, these plans were suppose to be made extremely affordable as they are marketed primarily to the poor. Silver plans are suppose to be intended for mid- and upper-middle class wage earners, folks who were employed full-time but their employer's insurance plan might be alittle on the pricy side OR might not provide full coverage per the essential benefits under ObamaCare as outlined. It's these clients who would most likely receive the health insurance tax credit. Those who purchase Gold or Platinum plans ("Cadillac" plans) wouldn't need financial assistance; they can afford to buy insurance on the individual market if they wanted.

So, the question once again is what level of insurance is offered through the federal exchange? Does anyone know?
Click to expand...

gold and platinum plans are not "cadillac plans". Cadillac plans have much higher premiums
 
sangha said:
gold and platinum plans are not "cadillac plans". Cadillac plans have much higher premiums
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Yeah right....Obamacare was the biggest lie Obama told until he claimed that Moochelle's mother currently lives in the ghetto.
 
buck said:
That's exactly the intent... as stated by Gruber on at least two occasions so far found.
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Gruber's statements are irrelevant

Sec 1004 of HCERA, which was passed to "reconcile" discrepancies in PPACA, explicitly refers to tax credits earned by purchasing plans through exchanges established under both Sections 1311 & 1321 of PPACA

http://www.dol.gov/ebsa/pdf/healthcareandeducationreconciliationact.pdf

‘‘(3) INFORMATION REQUIREMENT.—Each Exchange (or any
person carrying out 1 or more responsibilities of an Exchange
under section 1311(f)(3) or 1321(c) of the Patient Protection
and Affordable Care Act) shall provide the following information
to the Secretary and to the taxpayer with respect to any health
plan provided through the Exchange:
‘‘(A) The level of coverage described in section 1302(d)
of the Patient Protection and Affordable Care Act and
the period such coverage was in effect.
‘‘(B) The total premium for the coverage without regard
to the credit under this section or cost-sharing reductions
under section 1402 of such Act.
‘‘(C) The aggregate amount of any advance payment
of such credit or reductions under section 1412 of such
Act.
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Sec 1412 of PPACA is the section that authorizes the advance tax credits
 
Objective Voice said:
While I'm sure the fed had hoped the States would play along more, I believe the DC Court got it right despite what Congressional legislators might have intended.
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Those are conflicting statements. The DC Court was tasked with determining Congressional intent. The DC circuit ruled that Congress INTENDED to deny credits to resident living in recalcitrant states, and there is no evidence of that in the Congressional record. All anyone can find is oblique references and the opinions of people NOT members of Congress, which is odd given the HUGE impact of that decision. There is no evidence states believed the credits hinged on them establishing their own exchanges, instead of piggy backing on the Federally run exchange, etc.
 
JasperL said:
Those are conflicting statements. The DC Court was tasked with determining Congressional intent. The DC circuit ruled that Congress INTENDED to deny credits to resident living in recalcitrant states, and there is no evidence of that in the Congressional record. All anyone can find is oblique references and the opinions of people NOT members of Congress, which is odd given the HUGE impact of that decision. There is no evidence states believed the credits hinged on them establishing their own exchanges, instead of piggy backing on the Federally run exchange, etc.
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I do not believe that to be true. The court is required to use a two-part process in its' decision. The first part is to determine if there is any ambiguity in the text of the bill - the *entire* text of the bill. Pulling out one or two sentences (or three or four) that are clear and consistent is not sufficient to show a lack of ambiguity. Instead, they must go through the entire text and ensure that there is no conflicting provisions anywhere in the text.

If there are no conflicts, then the text must be adhered to, and the IRS's interpretation must be discarded. In this case, there are conflicting provisions. The most important one is in Sec 1004 of HCERA which requires all states with exchanges created under both Sec 1311 and Sec 1321 to report "The aggregate amount of any advance payment of such credit or reductions under section 1412 of" PPACA

If they did not intend on Sec 1321 exchanges to provide such tax credits, then they wouldn't explicitly require them to report the amount of such credits they paid.

Since there was a conflict, the 2nd part of the process is used. This part says that the IRS's interpretation must be deferred to unless it clearly differs from any reasonable interpretation of any part of the text, or if it is unconstitutional. The court found that it did not do so, so the IRS's regulations stand.
 
Objective Voice said:
Thanks for the clarification.
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To be even more specific, a cadillac plan is an employer sponsored plan where the premium is more than $10,200 a year for single coverage and $27,500 for family coverage. Since plans bought through the exchange are not employer-sponsored, they can't be cadillac plans
 
Sangha said:
Sec 1004 of the HCERA reads:

‘‘(3) INFORMATION REQUIREMENT.—Each Exchange (or any person carrying out 1 or more responsibilities of an Exchange under section 1311(f)(3) or 1321(c) of the Patient Protection and Affordable Care Act) shall provide the following information to the Secretary and to the taxpayer with respect to any health plan provided through the Exchange:

‘‘(A) The level of coverage described in section 1302(d) of the Patient Protection and Affordable Care Act and the period such coverage was in effect.
‘‘(B) The total premium for the coverage without regard to the credit under this section or cost-sharing reductions under section 1402 of such Act.
‘‘(C) The aggregate amount of any advance payment of such credit or reductions under section 1412 of such Act.
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Section 1321(c) of the PPACA reads (parsed to get beyond all the legalese):

[If a] State elects not to establish and operation an Exchange (including SHOP Exchanges) which offers qualified health plans or establishes reinsurance and risk
adjustment programs [or meet other] such requirements as the Secretary determines appropriate, [under Section 1311(f)(3) of the PPACA], the Secretary shall (directly or through agreement with a not for-profit entity) establish and operate such Exchange within the State and the Secretary shall take such actions as are necessary to implement such other requirements.
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It would appear that Sec 1004 of the HCERA brings the issue of whether only State-sponsored Exchanges would receive tax credits. From this reading, ALL EXCHANGES whether established by the State or the federal government would receive health care tax credits. However, if you take your interpretation of the law solely from the PPACA, you'd rightly conclude that the tax credits would only apply to the States. But such an interpretation would ignore the totality of the law as amended through reconciliation which takes me back the linked article in my post #229. Seems the author was on top of this issue in 2012 and nailed it down cold.
 
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