The Little-Known Legal Case that Could Destroy Obamacare

(Jon Elswick/AP Photo)
(Jon Elswick/AP Photo)

While the Supreme Court considers one challenge to a provision of the Affordable Care Act (ACA), a federal appeals court located just blocks away is contemplating a separate challenge that could have much more dire consequences for the future of the law.

“What you’re asking for is to destroy the individual mandate, which guts the statute,” Judge Harry T. Edwards of the U.S. Court of Appeals for the District of Columbia said to an attorney representing the challengers during a hearing on March 25.

The case — Halbig vs. Sebelius — was heard by Edwards and two other judges and they are expected to rule in the coming months.

It concerns the American Health Benefit Exchanges (known as “exchanges”). The ACA provides for the establishment of the exchanges that are meant to help individuals (who in general are not getting insurance from an employer) to purchase competitively-priced health insurance. The philosophy behind the exchanges is that collective purchasing power will lead to more affordable insurance.

The ACA states that states can establish or operate the exchanges, or the federal government will step in to do so.

So far, 16 states and the District of Columbia have elected to set up their own exchanges, while 34 states rely on federally run exchanges.

The conflict at the center of the Halbig case (and three other challenges across the country) has to do with tax subsidies granted to those who seek to obtain insurance from the exchanges. The ACA grants the credits to qualifying individuals in order to defray the cost of the insurance. Millions of Americans are expected to take advantage of the subsidies.

But challengers to the law dispute who is eligible for the tax credits.

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SOURCE:   
ABC News

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