If House Republicans win legal standing in their lawsuit challenging the Affordable Care Act's cost-sharing subsidies, their case could pose another serious threat to the law's coverage expansion.
U.S. District Judge Rosemary Collyer in Washington currently is deciding whether to allow the lawsuit to proceed or dismiss it because the plaintiffs have not suffered an actual harm, and therefore don't have the right to sue. Collyer's questions during recent oral arguments, along with her subsequent information requests, have led some observers to speculate that she will let the plaintiffs argue their case on its merits.
If she does, and her ruling on standing is upheld by the appellate court, some experts say the plaintiffs' substantive arguments have a chance of success. The case comes as the U.S. Supreme Court is set to rule on the separate issue of premium subsidies in King v. Burwell.
House Republicans argue that the Obama administration is illegally spending money that Congress never appropriated for the law's cost-sharing provisions, which mandate reduced deductibles, co-pays and co-insurance for exchange plan members in silver-tier plans with incomes up to 250% of the poverty level. The plaintiffs say the government is projected to pay insurers $175 billion over 10 years to protect consumers from cost-sharing.
“Once you get past standing, I think it's pretty clear these cost-sharing subsidies have not yet been appropriated,” said Andrew Kloster, a legal fellow with the conservative Heritage Foundation.
Kermit Roosevelt, a University of Pennsylvania constitutional law expert, said an argument that an administration has spent money that was not appropriated by Congress is sometimes “a good argument because Congress is supposed to control how money is spent, so the ability of the president to spend money against the expressed will of Congress is limited.” But such limitations are clearest when Congress specifically prohibits spending for certain purposes, he added. That is not the case here.
James Blumstein, a law professor at Vanderbilt University, said the standing issue is tougher than the substantive issue in the case. “If we assume for the sake of discussion that Congress appropriated money for one thing and it was spent on another thing, I think the House position becomes pretty strong once standing is satisfied,” he said.