A federal judge's decision that the Obama administration unconstitutionally spent money to pay for part of the Affordable Care Act may not disrupt health plans or beneficiaries right away. But the fresh uncertainty immediately delivered a blow to the share prices of hospitals and health insurers.
House Republicans alleged in a lawsuit that the administration illegally spent money that Congress never appropriated for the ACA's cost-sharing provisions.
Those provisions include reduced deductibles, copayments and coinsurance that many Americans receive, depending on their income, for health plans purchased through the ACA's insurance exchanges.
About 56% of Americans who receive coverage through the exchanges—approximately 5.6 million people—had seen cost-sharing reductions as of June 2015, according to the CMS.
U.S. District Court Judge Rosemary Collyer agreed with House Republicans last week, writing that appropriating the money without congressional approval violates the U.S. Constitution.
“None of the (HHS) Secretary's extra-textual arguments—whether based on economics, 'unintended' results or legislative history—is persuasive,” wrote Collyer, who was appointed by President George W. Bush.
The Justice Department confirmed late Friday that it would appeal the decision.
“It's unfortunate that Republicans have resorted to a taxpayer-funded lawsuit to refight a political fight that they keep losing,” White House Press Secretary Josh Earnest told reporters. “They've been losing this fight for six years. And they'll lose it again.”