A Second, Different Federal Appeals Court Upholds Key Provision Of Obamacare

A three-judge 4th Circuit Court of Appeals panel ruled Affordable Care Act subsidies are allowed in the 36 states that didn’t build exchanges. The ruling sets up a conflict with a decision earlier Tuesday from the D.C. Circuit Court of Appeals.

Larry Downing / Reuters

A 4th Circuit Court of Appeals panel ruled Tuesday that the Affordable Care Act’s subsidies are permitted in the states that rely on the federal health exchange, upholding a key regulation under the health care law.

The case centers around whether the Affordable Care Act and a subsequent IRS rule make subsidies available under the federal exchange. The government argued the law said that the government could do this; on Tuesday, the three-judge panel said the law is ambiguous and the regulation allowed, and therefore that the subsidies given to individuals purchasing health care through the federal exchange are permitted by the law.

Thirty-six states do not currently have fully functional state-based health exchanges.

The plaintiffs are expected to appeal the ruling. They either could first ask for “en banc” review of the case from the 4th Circuit, in which all the judges on the court would review the case (rather than the three-person panel), or they could seek review from the Supreme Court.

The ruling sets up a conflict with a decision earlier Tuesday from the D.C. Circuit Court of Appeals, a decision from which the White House has said it will seek en banc review.

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Chris Geidner is the legal editor for BuzzFeed News and is based in Washington, D.C. In 2014, Geidner won the National Lesbian & Gay Journalists Association award for journalist of the year.
Contact Chris Geidner at
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