A woman reads a leaflet at a health insurance enrollment event in Cudahy, Calif., March 27, 2014
Lucy Nicholson/Reuters

Court to rehear Obamacare challenge

A federal appeals court will re-consider a lawsuit challenging health insurance subsidies that are a key part of the Affordable Care Act.

A three-judge panel from the U.S. District Court of Appeals ruled in July that people seeking health insurance in states without state-run health insurance exchanges are not eligible for subsidies to buy insurance. Only 14 states run their own exchanges, while 36 states left residents to sign up for plans through HealthCare.gov.

On December 17, the full U.S. District Court of Appeals for the District of Columbia will rehear the Obamacare case, Halbig v. Burwell. The subsidies were a key component of the Affordable Care Act, meant to help low and middle income people pay for health care plans, and without them, millions of Americans could again find themselves unable to afford insurance.

On the same day the D.C. panel upheld the challenge to the subsidies, another court in Richmond ruled that the subsidies did apply to the federal exchange. That split decision had sparked hopes that the Supreme Court might eventually take up challenges to Obamacare.

The earlier ruling has been invalidated by the court’s decision to re-hear the case.

Opponents of the health care law had argued that it was written in such a way that only state exchanges were eligible for health insurance subsidies. Insurance premiums purchased on the federal exchange would have faced an average increase of 76% if the subsidies had been successfully overturned.

Conservatives have fought President Obama’s signature legislation since its inception, despite evidence that the law has led to a drop in the number of uninsured Americans.

Obamacare

Court to rehear Obamacare challenge