Federal Courts Deliver Conflicting Rulings on Obamacare

Two federal judicial panels on Tuesday delivered conflicting rulings on how the government subsidizes premiums through President Barack Obama’s healthcare law, creating more uncertainty over signature legislation that has been dogged by challenges from Republicans and other conservatives.

The rulings, handed down by appeals court judges in the District of Columbia and Virginia, could lead to a new showdown over Obamacare before the U.S. Supreme Court, which in June 2012 narrowly upheld the Democratic president’s healthcare insurance overhaul.

The cases deal with the federal government’s ability to offer premium tax credits to people who purchase insurance through the federal insurance marketplace that serves the majority of the 8 million consumers who have signed up for private coverage for 2014.

A three-judge panel of the U.S. Court of Appeals for the District of Columbia Circuit ruled in a 2-1 decision that the Affordable Care Act allows subsidies that help pay for insurance premiums to be offered only to consumers who purchase private health plans through exchanges run by states.

The judges suspended their ruling pending an appeal by the administration. The Obama administration said it would appeal to the full circuit court, a process that could take up to six months, and stressed the ruling would have no impact on consumers receiving monthly subsidies now.