2 courts, 2 vastly different opinions about Affordable Care Act

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Roughly 258,000 Pennsylvanians whose health insurance premiums are subsidized by the government under the Affordable Care Act had a lot at stake Tuesday as members of two federal courts debated whether the wording of the federal health care law prevents the government from offering financial assistance to low- and middle-income Americans in states that use the federally run health insurance exchange.

To the ire of Democrats and health care overhaul advocates, a federal appeals court panel in Washington, D.C., handed down a 2-1 decision Tuesday declaring that eligible residents of states that use the health insurance marketplace run by the federal government — like Pennsylvania — may not receive government subsidies for their premiums under the ACA.

The ruling of the three-judge panel, part of the U.S. Court of Appeals for the D.C. Circuit, was not made by the full court, but if upheld, it could jeopardize billions of dollars in insurance subsidies provided by the government.

John McDonough, a professor at the Harvard School of Public Health, called the chance that the full D.C. court will uphold the panel’‍s decision “highly remote,” noting that other courts have found the subsidies to be legally sound. Just hours after the panel issued its decision, the U.S. Court of Appeals for the Fourth Circuit in Richmond, Va., issued a ruling that directly contradicted the D.C. panel’‍s findings and upheld the same subsidies.

This debate surrounding the ACA, highlighted by the two conflicting decisions Tuesday, calls into question the legality of financial assistance currently enjoyed by hundreds of thousands of Pennsylvanians. Of the roughly 318,000 Pennsylvanians enrolled in health insurance plans through the federal insurance exchange, 81 percent receive financial assistance from the government in paying their premiums, according to the U.S. Department of Health and Human Services.

Highmark, the leading health care company in Pennsylvania, has 177,000 health plan members in the state who are enrolled through the ACA, according to spokesman Aaron Billger.

He said 131,000 are enrolled through the federal insurance exchange, and 80 percent of those 131,000 receive financial assistance.

Pennsylvania is one of three dozen states whose governments declined to set up state-run marketplaces for health insurance following the 2010 passage of the ACA — dubbed “Obamacare” by critics — leaving state residents to enroll under the law through the federal insurance marketplace.

The appeals court panel in D.C. on Tuesday argued that the wording of the law prevents the government from offering financial assistance to eligible Americans in the 36 states that use the federal marketplace rather than state-run exchanges.

The court in Richmond came to the opposite conclusion.

Tuesday’‍s rulings will have no immediate impact on Pennsylvania residents currently enrolled under the health care law, experts and advocates said.

Anyone who purchased their insurance plans through the federal exchange and whose premiums are currently subsidized by the government will continue to receive that financial assistance despite the panel ruling. And calling the D.C. panel’‍s decision incorrect, Obama administration officials vowed Tuesday that those eligible policyholders would continue to receive aid.

Residents, then, will remain virtually unaffected as the case continues to work its way through the courts.

“It’‍s important for consumers to know that this ruling does not affect the financial assistance that they may have received,” said Bill England, the Pennsylvania state director for the health care advocacy group Enroll America. “It’‍s very complex, and all of us are just going to have to wait and see how it exactly plays out.”

If the subsidies were ultimately struck down, such a decision would affect a significant number of people in the state.

“We’‍re talking about hundreds of thousands of Pennsylvanians,” said Antoinette Kraus, director of the Pennsylvania Health Access Network, a group that advocates for expanding coverage to uninsured people throughout the state. “There’‍s a real fear that if this were overturned, folks would lose access to their health insurance coverage.”

Across the country, 6.7 million people enrolled receive advance premium tax credits for marketplace coverage. That’s 85 percent of all people who signed up under the law. Seventy percent of them — 4.7 million people — get tax credits through the federal marketplace.

Madeline R. Conway: mconway@post-gazette.com, 412-263-1714 or on Twitter @MadelineRConway. The Washington Post contributed.

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