Okay, judges — want to know what was actually intended with the Affordable Care Act (a.k.a. Obamacare) with regard to federal subsidies for state exchanges? The architect of the law makes it crystal clear that the subsidies are indeed only intended for those living in states that set up and operate their own exchanges and not for people who are enrolled in the federal government’s exchange.
What’s important to remember politically about this is if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits—but your citizens still pay the taxes that support this bill. So you’re essentially saying to your citizens you’re going to pay all the taxes to help all the other states in the country. I hope that that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these exchanges. But, you know, once again the politics can get ugly around this.
So, there you have it. The D.C. Circuit Court got it right and the Fourth Circuit got it wrong this week. Obviously this provision is not a “typo” as Gruber is now going around saying in the media and in amicus briefs, but was intentional as the proverbial “carrot and stick” approach.