A federal appeals court on Thursday refused to allow two recipients of the Affordable Care Act cost-sharing reduction subsidy the chance to intervene in a case to defend subsidy funding actions that U.S. House Republicans challenged as unlawful.
The two cost-sharing reduction subsidy recipients, fearing the threat Donald Trump’s administration poses to the future of the health law, said they wanted to join the case to protect their interest in provisions that reduce deductibles and co-pays. About 6 million ACA public exchange users participate in the cost-sharing reduction subsidy program.
The U.S. Court of Appeals for the D.C. Circuit turned down the request. The court’s brief order, posted Thursday, said the would-be intervenors “have not demonstrated that they are entitled to intervene in this case.” A team from Mayer Brown represented the two ACA subsidy program participants.
The case remains on hold until at least mid-February. The U.S. House asked for the delay to allow the Trump administration to plot a new course, potentially withdrawing from the litigation or settling the dispute.
A Washington federal judge last year said the Obama administration had unlawfully reimbursed billions of dollars to insurance companies without a specific congressional appropriation. The Justice Department appealed to the D.C. Circuit; the court’s injunction, blocking the program, was paused for the appeal.
Lawyers for the U.S. House and for the U.S. Department of Human Services resisted the effort by the two ACA subsidy recipients to join the case in the D.C. Circuit.
Thomas Hungar, general counsel to the U.S. House, argued that the recipients are “statutorily eligible for and scheduled to receive cost-sharing reductions in 2017, which will remain true as a matter of law regardless of the outcome of this litigation.”
“Until the new administration has taken office and determined its position, there is no basis for concluding that it will not adequately represents movants’ interests, and the current administration is obviously in no position to address that question,” Hungar wrote in court papers.
The Justice Department said the intervention request was premature and asked the court to reject it without prejudice. There is no plan yet how the House and the Trump administration will resolve the pending suit over the cost-sharing program.
“There is no doubt that allowing the injunction to take effect would cause major disruption of insurance markets, but the motion rests on speculation that such an agreement will occur,” Justice Department lawyers told the appeals court.
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