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Courts snarl health law in split rulings

– President Barack Obama’s health care law is snarled in another big legal battle, with two federal appeals courts issuing contradictory rulings on a key financing issue within hours of each other Tuesday.

But the split rulings don’t necessarily mean another trip to the Supreme Court for the Affordable Care Act.

And White House spokesman Josh Earnest immediately announced that millions of consumers will keep getting financial aid for their premiums – billions of dollars in all – as the administration appeals the one adverse decision.

In that first ruling, a divided three-judge panel in Washington called into question the subsidies that help millions of low- and middle-income people afford their premiums, saying financial aid can be provided only in states that have set up their own insurance markets, or exchanges.

About 100 miles to the south in Richmond, Virginia, another appeals court panel unanimously came to the opposite conclusion, ruling that the Internal Revenue Service correctly interpreted the will of Congress when it issued regulations allowing health insurance tax credits for consumers in all 50 states.

Split appeals court decisions are a classic route to the Supreme Court. But in this situation, it’s far from clear what will happen because the administration still has a legal card to play.

Because the Washington case was decided by a three-judge panel – two of them Republicans – the administration will ask the full 11-member appeals court to hear the case.

The full U.S. Court of Appeals for the District of Columbia Circuit has seven judges appointed by Democratic presidents, including four by Obama.

If the full court comes out in favor of the administration, the prospect of Supreme Court involvement would be greatly diminished.

On the other hand, if the full Washington court stays out of it or, after a hearing, essentially leaves the panel’s decision in place, then the Supreme Court would almost certainly weigh in.

Democratic appointees also constitute a majority of the full appeals court in Richmond.

Both cases are part of a long-running political and legal campaign to overturn Obama’s signature domestic legislation by Republicans and other opponents of the law.

According to the Department of Health and Human Services, 87 percent of the 8 million people enrolled in the federal insurance exchange receive tax credits. On average, they pay $82 in monthly coverage premiums, compared with $346 for those who do not qualify for tax breaks.

Indiana is among 36 states on the federal insurance exchange. The average monthly premium for Hoosiers is $88 with tax credits and $424 without.

Lee and Karen Albright, owners of Albright Meats & Deli in Fort Wayne, have enrolled their family in the Affordable Care Act and encouraged many of their 35 employees to do likewise.

Karen Albright said she knows of at least one worker who has enrolled and taken the tax credit, which the Albrights do not receive.

Tax credits “are one of the selling points” of the health care law, she said. “It’s not affordable for the average employee without it.”

Albright said the meat retailer dropped its employee group insurance plan in December “because nobody was taking us up on it. It was a small group, and it was too expensive for anybody else to have.

If you’ve got a 50-year-old employee and they were looking at paying $400 a month, they didn’t take it.”

The court rulings issued Tuesday revolve around four words in the 900-page health care law, which says tax credits to help pay premiums are available to people who enroll through an exchange “established by the state.”

The challengers to the law say a literal reading of that language invalidates the IRS subsidy to people in the federal exchange.

But the Obama administration and congressional and state legislative supporters of the Affordable Care Act say the challengers are failing to consider the words of the statute in its entirety.

The Supreme Court has considered several challenges to the health care law, most recently ruling that some private companies don’t have to cover birth control if it offends religious scruples.

The biggest ruling came in 2012, when a divided court let stand the law’s core requirement that most Americans carry health insurance or face fines.

Brian Francisco of The Journal Gazette contributed to this story.

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