Appellate Courts Split on Public Exchange Subsidies

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Appellate Courts Split on Public Exchange Subsidies
Calendar22 July 2014

In a surprising turn of events, two federal appellate courts have issued contradictory rulings today addressing whether the Affordable Care Act limits premium tax credits and cost sharing subsidies to coverage from state-run exchanges. The DC Circuit ruled that subsidies are limited to the state-run exchanges while the 4th Circuit upheld an IRS rule authorizing the subsidies on all public exchanges. The Administration announced that it will ask for a rehearing en banc by the full DC Appeals Court and has also said that subsidies from the federal exchanges will continue to be available pending any appeals. This issue may ultimately be resolved by the US Supreme Court.

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