Obamacare subsidy case could be reviewed by U.S. Supreme Court

[August 01, 2014]  (Reuters) - The U.S. Supreme Court has been asked to review a case about whether the federal government can subsidize health insurance for millions of Americans, a party involved in the lawsuit said on Thursday.

The petition requests the U.S. high court decide the issue after two lower U.S. court rulings created uncertainties last week regarding the legitimacy of subsidies for individuals enrolled on federally run exchanges under the Affordable Care Act, or Obamacare.

The Competitive Enterprise Institute, which is coordinating and funding the cases, filed the petition, according to the not-for-profit's website. (http://bit.ly/1tA8r5x)

The twin appeals court rulings, handed down by three-judge panels in Washington, D.C., and Richmond, Virginia, fell in line with partisan disagreements over healthcare reform. Two judges appointed by Republican presidents decided against the administration in the District of Columbia and three judges appointed by Democrats ruled in favor in Virginia.

The U.S. Court of Appeals for the District of Columbia Circuit ruled in a 2-1 decision that the language in the Affordable Care Act dealing with subsidies shows they should only be provided to consumers who purchase benefits on exchanges run by individual states.

However, plaintiffs in the D.C. Circuit case, known as Halbig v. Burwell, claimed that Congress did not intend to provide subsidies through federally operated marketplaces.

While the Supreme Court has broad discretion over which cases to take, a split among lower courts can be a big factor in its deciding whether to hear an appeal.

The Supreme Court upheld the Obamacare law on constitutional grounds in 2012 but allowed states to opt out of a major provision involving Medicaid coverage.

Analysts estimate that as many as 5 million people could be affected if subsidies disappear from the federal marketplace, which serves 36 states through the website HealthCare.gov.

(Reporting by Narottam Medhora and Amrutha Penumudi in Bangalore; Editing by Lisa Shumaker)

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