Courtesy of Mish.
A few days ago an article the LA Times announced LA Times More legal trouble for Affordable Care Act.
The Affordable Care Act proposes to make health insurance affordable to millions of low-income Americans by offering them tax credits to help cover the cost. To receive the credit, the law twice says they must buy insurance “through an exchange established by the state.”
But 36 states have decided against opening exchanges for now. Although the law permits the federal government to open exchanges instead, it does not say tax credits may be given to those who buy insurance through a federally run exchange.
Apparently no one noticed this when the long and complicated bill worked its way through the House and Senate. Last year, however, the Internal Revenue Service tried to remedy it by putting out a regulation that redefined “exchange” to include a “federally facilitated exchange.” This is “consistent with the language, purpose and structure … of the act as a whole,” the Treasury Department said.
But critics of the law have seized on the glitch. They have filed four lawsuits that urge judges to rule the Obama administration must abide by the strict wording of the law, even if doing so dismantles it in nearly two-thirds of the states. And the Obama administration has no hope of repairing the glitch by legislation as long as the Republicans control the House.
This week, U.S. District Judge Paul Friedman in Washington, a President Clinton appointee, refused the administration’s request to dismiss the suit. Instead, he said the challengers had put forward a substantial claim, and he promised to issue a written ruling.
“This is a problem,” said Timothy Jost, a law professor at Washington and Lee University. “This case could have legs,” although “it was never the intent of Congress to establish federal exchanges that can’t do anything.
Might Such a Challenge Work?
After reading the LA Times article, I pinged a couple of very bright lawyers and asked if there was any chance such a strategy might work. One of them replied ….
Hello Mish
It’s hard to say, especially since there were probably matching changes in the Internal Revenue Code as well.
Usually you can make arguments to help interpret language like this from its context by reading other sections of the law. But what if other sections of the law are worded similarly?
I tend to think that no one intended this result. Will the court rule on intent?
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