HHS wins Halbig PPACA premium subsidy rehearing

The three-judge D.C. Circuit panel voted 2-1 in favor of Halbig. Later on July 22, a three-judge panel at the 4th U.S. Circuit Court of Appeals voted 3-0 in favor of HHS in a ruling on a similar case, King et al. vs. Burwell et al. (Case Number 14-1158). In the King ruling, the judges argued that the language in PPACA is ambiguous and that PPACA gives HHS the authority to resolve ambiguities in the PPACA exchange provisions.

In some states, officials who support PPACA have let HHS run the states’ PPACA exchange programs because of concerns about the states’ ability to run an exchange. In other states, HHS is running the PPACA exchanges because officials have actively refused to participate in the exchange program.

Some commentators have suggested that the judges on the full D.C. Circuit are more liberal than the judges on the original three-judge Halbig panel and are more likely to issue a ruling that would let HHS continue to provide premium subsidies for HHS exchange QHP buyers. If the full D.C. Circuit appeals court ruled against HHS, and the Supreme Court ended up letting a ruling against HHS stand, HHS might have trouble running viable exchanges in states in which premium subsidies were unavailable, because about 90 percent of the enrollees at the HHS-run exchanges are getting premium subsidies. The subsidies are cutting the share of QHP premiums that the enrollees pay out of their own pockets by an average of about 75 percent to 85 percent.