President Barack Obama is facing a “death spiral” for Obamacare as a federal court weighs a controversial legal challenge that could wipe out healthcare subsidies for millions of Americans.
The “bomb-thrower” case that could spark the destruction of Obama’s landmark domestic policy centers around the subsidies that 5 million Americans received when buying insurance through the HealthCare.gov exchanges, which sold coverage for 36 states this year, according to CNBC.
The plaintiffs in the little-known case, Halbig v. Sebelius, allege that these subsidies were illegal because Obamacare only permitted tax credits to be given to people who had bought insurance from the 14 individual states with their own exchanges, as well as the District of Colombia, not federal exchanges.
CNBC reported that 90 percent of enrollees in the federal exchanges qualified for subsidies due to their low or moderate incomes. The Affordable Care Act could go into a tailspin, before finally crashing and burning, if the courts now rule that those credits are illegal.