Obamacare

Federal Court Rules That Obamacare Subsidies Were Illegally Funded

Only Congress has the power to appropriate funds.

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Whitehouse.gov

A federal judge ruled today that the Obama administration has been implementing Obamacare illegally, paying out billions in subsidies to insurers that aren't authorized under the law.

The lawsuit, led by House Republicans, argued that the administration had no authority to fund law's cost-sharing reductions, which provide an additional subsidy to people who earn up to 250 percent of the poverty line, which ended up being a little more than half of people enrolled in coverage through the health law's exchanges. (The cost-sharing subsidies are distinct from the law's main insurance subsidies, which cover a portion of the cost of insurance coverage for people up to 400 percent of the poverty line.) 

The subsidies were authorized by the law, but Congress rejected an appropriations request from the administration to fund them. The administration moved some money around and funded them anyway. Estimates indicate that the program would funnel about $130 billion to insurers over the course of a decade.

The House suit argued that the move was illegal, usurping the legislative branch's power of the purse. The administration argued that the decision to fund the program was just a normal matter of statutory interpretation, and any confusion over its status just a result of Obamacare's "inartful drafting."

U.S. District Court Judge Rosemary Collyer agreed, writing that "Congress is the only source for such an appropriation, and no public money can be spent without one," reports Politico.

The program won't be shut down immediately, however. Instead, it will keep running as an appeal works its way through the system. If the administration ultimately prevails on appeal, then implementation of the law proceeds as it is now.

If the House wins, then things become…complicated. One possibility that's been raised in news reports is that insurers would substantially increase premiums in order to make up for the lost funding. More likely, however, is that health law beneficiaries will continue to get their subsidies, which are mandated by law, but that insurers won't get paid for them. The insurers would then probably try to recover the payments through lawsuits. If the cost-sharing subsidies were to end, it might have complex fiscal effects that end up canceling out the savings from those payments no longer being made. 

But there are lots of legal hurdles to jump through before any of that is worked out. In the meantime, it's a reminder that, at best, Obamacare is a poorly drafted law that relies on dubious statutory interpretation in order to function, and that there's a legally plausible case to be made that it's a patchwork legislative mess that doesn't hold together without a willingness to engage in illegal and unconstitutional implementation.

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  1. If this holds up on appeal, the insurance companies have to pay the money back, right?

  2. Damn, that’s going to leave a mark. But, this may also drive poor and prog voters to the polls in record numbers.

    1. I doubt it. One, it will be under appeal well past November

      Huh, dont have a two.

      1. Even so, robc, the progs will tell their supporters they have to vote “for O-care.” These are low-information progs and moochers.

    2. this may also drive poor and prog voters to the polls in record numbers.

      They do not care about facts, Tonio. However, certain tall man with a luscious head of hair is going to drive those particular voters to the polls.

    3. If the importance of a SC seat being in the hands of a fellow traveller for the next 20 odd years isn’t enough to motivate the base to fall in line, this won’t either.

      Then again, the premium increase would have a much more immediate impact than the consequences of the slow erosion of your liberties through judicial rulings. And it does make great fodder for “repubs want your grandma to die” nonsense. Still, I predict the lowest voter turn out in decades. The main actors are reviled, and star power fills the seats. Most people don’t think beyond that.

  3. I haven’t been following…I thought Obama shut down the government to force funding of Obamacare, and that he won that battle?

  4. Hopefully, the uncertainty from this decision alone will be enough to drive insurers out of the exchanges in droves.

  5. I thought this was like settled law or something, you know?

    1. And stuff.

  6. Are you single tonight? A lot of beautiful girls waiting for you to http://goo.gl/pI9ucn
    The best adult dating site!

    1. What’s her insurance plan look like, and is she open to a sham marriage for kickbacks?

    2. So we can misappropriate fedgov money, spend it illegally, and then litigate it to kingdom come with no personal consequences? I’d try that myself but I suspect the authorities would consider it theft.

      1. I think Karinka is declaring that there will be awesome consequences to misappropriating money from the public purse for your own personal gain. Consequences that involve an enthusiastic nymphomaniac who has shaved off all the hair below the nape of her neck and views clothing as being a prison that she longs to escape.

        Your mileage may vary, though.

        1. Whoops, I don’t think she’ll have much to say on the topic.

          1. You might be surprised. Quite a few sex workers would have an opinion on this (underground economy, reported earnings, IRS, …)

  7. And who will be held liable for the current law breaking? Nobody but the taxpayers who’ve not only covered the illegal appropriations, but also the Gov’t on Gov’t lawsuits. Complete insanity.

    1. But they meant well so all is forgiven.

  8. The administration moved some money around and funded them anyway.

    Did Iranians or Nicaraguan Contras in any way benefit?

    1. Good point. Are there any handsome Marine colonels involved?

      1. I prefer to remember Fawn Hall.

        1. Black gloves and slight overbite ftw.

  9. Does the 1% still have to cover my healthcare?

    1. Only 1% of it.

      1. There goes that free penis reduction.

        1. You too? I thought I was the only one.

          1. Is that what Caitlyn Jenner called it, a “reduction?”

            1. Let’s just say that Vanessa Del Rio has been dethroned.

  10. U.S. District Court Judge Rosemary Collyer agreed, writing that “Congress is the only source for such an appropriation, and no public money can be spent without one,” reports Politico.

    IN YOUR FACE OBUMBLES! OK, let’s get that thing shut down…..

    The program won’t be shut down immediately, however. Instead, it will keep running as an appeal works its way through the system. If the administration ultimately prevails on appeal, then implementation of the law proceeds as it is now.

    :::gropes for shocked face, finds that he’s out:::

  11. And once again the idiocy of ramming this monstrosity through the system rears its ugly head. Rule number 1 of massive entitlement program – drag along a large enough number of guys from the other side of the aisle so that:

    a) fixing it is both your problems and b) the other side can’t just hang the thing on your neck.

    This is why you get somebody from the other party to co-sponsor important legislation. You’d think somebody with big time political aspirations that served in the Illinois legislature and the US Senate would understand this stuff. You’d certainly expect the House and Senate majority leaders to understand this stuff.

    1. Hey, Obama was in the U.S. Senate – not even Lincoln did that!

    2. People suffering from Narcissistic Personality Disorder tend to measure success differently than you or I.

      To NPD sufferers like Obama, the success was having something labeled “Obamacare” become the law of the land. That it accomplish its stated purpose was not really important. It was important to him that he not share the glory with anyone else, that it be *his* accomplishment.

      A narcissist will allow his house to burn down if calling the fire department might make him look bad. He’d prefer a house that was a smoldering ruin & someone else he can blame for it to a functional home and people laughing at him.

    3. But if this move is successful, they can point their finger and mewl that Obamacare doesn’t work because those Kochsucking Teahadists gutted it!

  12. The program won’t be shut down immediately, however. Instead, it will keep running as an appeal works its way through the system.

    Imagine if it worked that way for everyone.

    1. It’s good to be the king.

    2. As we speak, John Roberts is being reminded of the video with himself and the goat in the cheerleader costume.

  13. But there are lots of legal hurdles to jump through before any of that is worked out. In the meantime, it’s a reminder that, at best, Obamacare is a poorly drafted law that relies on dubious statutory interpretation in order to function, and that there’s a legally plausible case to be made that it’s a patchwork legislative mess that doesn’t hold together without a willingness to engage in illegal and unconstitutional implementation.

    Not forgetting of course that the entire thing is unconstitutional but for Roberts’ 11th hour lipstick-on-pig job with the law’s text.

    1. “lipstick-on-pig job”

      nastiest euphemism yet

  14. Hey, if you didn’t want the prez writing checks on your account you shouldn’t have given him signature authority at the bank. You’re the ones who started letting him handle the jobs you’re too lazy to do, don’t act all surprised now when you’ve come home and found him sleeping in your bed and eating your food and screwing your dog.

    1. Don’t forget that he broke the smallest chair as well.

  15. I don’t understand. Congress controls the purse strings. The administration acted without its consent. Black and white. Kill the subsidy and send a clear message to any future administration who thinks they have the mandate to be renegades ‘because people and do the right thing’. The political system is designed this way for a reason, no?

  16. I’m sure Roberts is working on his nonsensical justification for this now. He isn’t going to let some minor technocratic detail overthrow the Will of the People.

    1. Roberts already stripped Congress of defining what legislation means in the last ACA case. Based on that precedent, it is difficult to see how the executive does not have the authority to implement policy by any means necessary. The Supreme Court has already given the President the authority for a dictatorship with a mere whiff of nominal authorization by Congress.

  17. It is totally illegal and they know it. And they are going to lose on appeal. But that will happen after Obama leaves office. So he doesn’t give a fuck. Not his problem.

  18. Do you think Trump can maybe at least negotiate us a Wood Chipper subsidy in exchange for letting this stand?

  19. negativity, fear, and hate. what else you got? oh yeah, religious freedom and the bathroom bill.

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