A major section of Obamacare that allows the federal government to subsidize costs for insurance plan enrollees has been struck down by a federal judge.
U.S. District Judge Rosemary Collyer ruled Thursday that the administration does not, on its own, have the power to spend money on what are termed “cost sharing reduction” payments without an appropriation from Congress. The administration is expected to appeal.
In light of that, the judge allowed Obamacare’s operation to continue unchanged until the appeal process ends.
House Republicans had filed suit, claiming subsidies paid to insurance companies so they, in turn, lower costs for people enrolled under Obamacare, were unconstitutional. House Republicans claimed that because Congress never authorized the expenditure, the executive branch could not spend the money.
In the court case, the administration said a section of law that funds tax credits to help people pay for coverage also was the legal source for paying the subsidies.
However, the judge ruled that cost-sharing reductions require a separate congressional appropriation. Congress has made no such appropriation.
“Such an appropriation cannot be inferred,” Collyer wrote. “None of Secretaries’ extra-textual arguments — whether based on economics, ‘unintended’ results, or legislative history — is persuasive. The Court will enter judgment in favor of the House of Representatives …”
“Authorization and appropriation by Congress are non-negotiable prerequisites to government spending,” she wrote.
In September, Collyer had ruled in favor of House Republicans in rejecting an attempt by the Obama administration to say House GOP members lacked standing to bring the suit.
“The House sues, as an institutional plaintiff, to preserve its power of the purse and to maintain constitutional equilibrium between the executive and the legislature,” Collyer said then. “If its non-appropriation claims have merit … the House has been injured in a concrete and particular way.” (For more from the author of “House Republicans Win Court Fight over Obamacare” please click HERE)