Case striking down PPACA subsidies to be reheard: 10 things to know

The D.C. Circuit Court of Appeals in Washington has agreed to vacate its ruling that tax subsidies issued through federal exchanges are not legitimate under the Patient Protection and Affordable Care Act and granted the Obama administration's petition seeking a rehearing of the case.

Here are 10 things to know about the D.C. Circuit Court's decision striking down the subsidies and the significance of the court's decision to rehear the case.

1. The PPACA states tax subsidies for health insurance are to be provided "through an exchange established by the state." Based on the text of the law, lawsuits were filed challenging an IRS regulation that allows subsidies to be issued in all states.

2. In July, a divided three-judge panel of the D.C. Circuit Court of Appeals ruled tax subsidies may not be provided in states that did not establish their own exchanges. The ruling was expected to have extremely negative effect on the success of the PPACA, as more than 25 states have not set up their own insurance marketplaces.

3. The average monthly insurance premium is approximately $385. If subsidies were taken away in the states that did not establish their own exchanges, a significant number of people would likely be forced to give up their insurance coverage, as they would be unable to afford it.

4. Just two hours after the D.C. Circuit Court's decision was handed down, a three-judge panel from the Fourth U.S. Circuit Court of Appeals unanimously held low- and middle-income Americans in all states can legally receive subsidies for health insurance under the PPACA.

5. After the conflicting decisions were issued, it was expected the issue would be appealed to and heard by the U.S. Supreme Court.

6. In August, the Obama administration asked for a rehearing on the D.C. Circuit's decision striking down the subsidies.

7. The Obama administration's petition was granted. Therefore, the case will be heard en banc — by all active judges from the D.C. Circuit Court of Appeals, including two judges from the original panel.

8. Although en banc rehearings are granted rarely, this case presented extraordinary circumstances, as the insurance subsidies for millions were in limbo.

9. The divided three-judge panel that heard the subsidy case in the D.C. Circuit was comprised of two Republican appointees and one Democratic appointee. At the en banc hearing, there will be eight Democratic-appointed judges and five Republican-appointed judges hearing the case.

10. If the full D.C. Circuit court reverses the ruling by the three-judge panel, there will no longer be a split among jurisdictions concerning the issuance of the tax subsidies. With no split, it is less likely the case, if appealed to the Supreme Court, would be reviewed.

More articles on healthcare industry lawsuits:

CFO of Compass Healthcare pleads guilty to fraud scheme
10 recent healthcare industry lawsuits, settlements
Oregon sues Oracle for more than $200M over failed health exchange website

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