CNBC reports on a ruling by the U.S. Court of Appeals for the D.C. Circuit:
In a potentially crippling blow to Obamacare, a top federal appeals court Tuesday said that billions of dollars worth of government subsidies that helped nearly 5 million people buy insurance on HealthCare.gov are illegal.
A judicial panel in a 2-1 ruling said such subsidies can be granted only to those people who bought insurance in an Obamacare exchange run by an individual state or the District of Columbia — not on the federally run exchange HealthCare.gov.
“Section 36B plainly makes subsidies available in the Exchanges established by states,” wrote Senior Circuit Judge Raymond Randolph in his majority opinion, where he was joined by Judge Thomas Griffith “We reach this conclusion, frankly, with reluctance. At least until states that wish to can set up their own Exchanges, our ruling will likely have significant consequences both for millions of individuals receiving tax credits through federal Exchanges and for health insurance markets more broadly.”
36 states did not set up their own exchange. 86% of people (4.7 million people in all) who signed up through Healthcare.gov received subsidies