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The Halbig ruling on Obamacare subsidies in 3 sentences

On Tuesday morning, a federal court decision in Halbig v. Burwell struck a blow against Obamacare. The ruling came from the U.S. Court of Appeals for the D.C. Circuit, a federal court one step down from the Supreme Court. Here's a condensed version of what the court decided.

  1. The D.C. Circuit ruled that the Affordable Care Act never authorized subsidies for health insurance purchased on federally-run exchanges, rendering the subsidies illegal in 36 states.
  2. Although observers might say the decision absurdly undermines the entire purpose of Obamacare — which is to make affordable health coverage available to all — the court points to two other examples of potentially "absurd" outcomes from the text of the law, including language that would have locked Guam and other U.S. territories into an unsustainable health insurance system.
  3. The judges contend that there's not sufficient evidence from the legislative history (like old drafts of the law, or other evidence predating this lawsuit) to determine whether Congress intended to use subsidies as a carrot or make them available in every state; without clear legislative history, the court defaults to very strict interpretation of the plain text.

This isn't the last word on the lawsuit. Subsidies will continue to be offered while the courts iron out the wrinkles. Other cases are progressing elsewhere in the judicial system — a different federal appeals court ruled in favor of the government in a related case early Tuesday afternoon.