Lawsuits Filed over Obamacare Exchange Credit Rules

If computer glitches are not enough of a problem, President Obama's healthcare law also has a legal glitch that critics say could cause it to unravel in more than half the nation.

The Affordable Care Act proposes to make health insurance affordable to millions of low-income Americans by offering them tax credits to help cover the cost. To receive the credit, the law twice says they must buy insurance "through an exchange established by the state."

But 36 states have decided against opening exchanges for now. Although the law permits the federal government to open exchanges instead, it does not say tax credits may be given to those who buy insurance through a federally run exchange.

Apparently no one noticed this when the long and complicated bill worked its way through the House and Senate. Last year, however, the Internal Revenue Service tried to remedy it by putting out a regulation that redefined "exchange" to include a "federally facilitated exchange." This is "consistent with the language, purpose and structure … of the act as a whole," the Treasury Department said.

#Obamacare #AffordableCareAct #Lawsuits #Subsidies