“Red States” may make their poor poorer. Thanks, GOP!

Not many noticed, with all the latest news storms from Ukraine and the Middle East, but something happened in the courts on the East Coast of the US. Two specific ones, actually: US Court of Appeals for the 4th Circuit and the US Court of Appeals for the DC Circuit. This may have a huge bearing on the low-income populations of the Republican-dominated States that refuse to participate in the ACA exchanges’ program. Specifically – it may make the poor people much poorer. Or sicker. Or both.

So what’s that about?

The question is, whether the Federal subsidies under the ACA law (the Obamacare) should only be allowed for insurances purchased on the State-run exchanges.

U.S. Court of Appeals for the DC Circuit (covering the District of Columbia) decided so, and reversed a lower courts’ decision that allowed subsidies for insurance purchased on the Federal exchange site.

U.S. Court of Appeals for the Fourth Circuit  (covering Maryland, the Carolinas and the Virginias) decided the opposite and upheld the IRS rules for credits under the ACA regulations.

Under the (unanimous) decision of the 4th Circuit court IRS can allow credits as defined in ACA to those who got the insurances from the Federal exchange. That would be all the people who live in the Republican-controlled States which refused to participate in ACA. For those, the Federal government stepped in and made an exchange in place of the State exchanges as defined in ACA.

Under the (split) decision of the DC Circuit court, the IRS cannot allow these credits, and the insured from the “Republican” States must carry the full weight of their coverage.

The Federal Government will likely to request a review by the DC Circuit Court, but if the decision stands – it will be up to the Supreme Court to decide. Knowing it is controlled by the Republican-leaning justices, it is not hard to see what the decision would be.

The fix is easy – Congress must explicitly allow these credits which were indented to be given and accounted for in the original law. However, the Republicans in the current Congress will prefer seeing their own constituents suffer rather than agree to fix a “bug” in the law. In fact, they may even try to turn it to their “benefit” showing how “bad” the law is, instead of fixing a problem it creates for their citizens.

It is your chance to make a change. Call your Congressman and Senators, and tell them to act and fix this. The poor should not be discriminated against judging by the color of their State governors. If you live in one of those States – this November you have a chance. Elect a Congressional delegation that will know more than one word “No”.

Your Little Advisor.

This entry was posted in News and Politics, Taxes - General and tagged , , , . Bookmark the permalink.

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