A three-judge panel at the 4th U.S. Circuit Court of Appeals today ruled that the Internal Revenue Service (IRS) can provide premium subsidies for people who use the public exchanges run by the federal government.
The court panel collided with colleagues at the D.C. Circuit Court of Appeals, who came to the opposite conclusion in a 2-1 ruling on a similar case, Halbig et al. vs. Burwell et al. (Case Number 14-5018), earlier in the day.
The three 4th Circuit judges agreed that the Patient Protection and Affordable Care Act (PPACA) lets the government offer premium subsidies to consumers who buy qualified health plan (QHP) coverage through the public exchanges run by the U.S. Department of Health and Human Services (HHS) as well as those who buy QHPs through state-based exchanges.
In an opinion explaining the ruling, on David King, Douglas Hurt, Brenda Levy and Rose Luck vs. Sylvia Mathews Burwell et al. (Case number 14-1158), Circuit Judge Roger Gregory writes that it’s not clear how large a role Congress expected HHS-run exchanges to play.
“Nothing in the legislative history of the act provides compelling support for either side’s position,” Rogers writes. “Simply put, the statute is ambiguous and subject to at least two different interpretations.”
The act clearly gives the HHS the authority to resolve ambiguities in the exchange provisions, Rogers says.
“This clear delegation of authority to the IRS relieves us of any possible doubt regarding the propriety of relying on one agency’s interpretation of a single piece of a jointly-administered statute,” Rogers concludes.
In an opinion explaining the ruling on Halbig, D.C. Circuit Judge Thomas Griffith referred briefly to the legislation interpretation principles the U.S. Supreme Court established in 1984, in a ruling on Chevron U.S.A. Inc. vs Natural Resources Defense Council Inc. In the King opinion, Rogers relies more heavily on the principles set forth in Chevron. He says a court must start by looking at the plain meaning of a statute.