Appeals court agrees to put Obamacare lawsuit on hold until Trump takes office
posted at 3:01 pm on December 5, 2016 by John Sexton
A federal appeals court has agreed to delay a court case over cost-sharing payments made as part of Obamacare. From Reuters:
A federal appeals court on Monday brought to an end President Barack Obama’s bid to overturn a ruling that threatens to gut his signature healthcare law by putting the case on hold until after President-elect Donald Trump, who aims to repeal Obamacare, takes office.
The Obama administration had appealed a judge’s May ruling favoring the challenge filed by Republicans in the U.S. House of Representatives against a key part of the 2010 law. But the U.S. Court of Appeals for the District of Columbia Circuit agreed to a request by the Republicans to delay its consideration of the government’s appeal until after Trump takes office on Jan. 20.
The GOP filed a lawsuit back in 2014 claiming the Obamacare cost-sharing payments were being made without any appropriation of money from Congress. In May of this year a judge sided with the GOP ruling that the payments to insurers were being made without a proper congressional appropriation.
The GOP Congress released a report on the cost-sharing payments in July which pointed out that Obama’s own Treasury Department initially said it could find no appropriation for the payments and then went to Congress asking for a $4 billion appropriation. That appropriation request was later withdrawn by phone (very unusual) and the OMB authorized the payments without an appropriation. All of that to say, the Obama administration knew it needed congressional authorization to spend this money but, when it couldn’t get it, decided to spend it anyway in an effort to keep insurers happy.
However, the administration appealed and the judge’s May ruling was put on hold while that appeal was being considered. The next step in that appeal process was set to happen the day before Trump was sworn into office. Last month the GOP asked for a delay until February on the grounds that the new administration might feel differently about having its lawyers appeal the decision. Now that the court has agreed to the delay it means this will be decided by the Trump administration. If the administration decides to halt the appeal the payments would end. More to the point, the new administration could be in the process of repealing the entire law by the new February deadline.
If there’s not an immediate repeal bill then the Trump administration could either let the payments end or it could offer to extend them though the end of the year as part of a transition effort to whatever replacement the GOP is hoping to pass. Either way, this is no longer in Obama’s hands.