Oklahoma judge strikes down PPACA subsidies

A federal judge in Oklahoma has ruled it is unlawful for tax subsidies under the Patient Protection and Affordable Care Act to be provided to consumers who purchased insurance through a federal exchange, according to a report by The Wall Street Journal.

The PPACA states tax subsidies for health insurance are to be provided "through an exchange established by the state." Based on the text of the law, lawsuits were filed challenging an IRS regulation that allows subsidies to be issued in all states. Oklahoma challenged the IRS rule in 2012.

U.S. District Judge for the Eastern District of Oklahoma, Ronald White, ruled in favor of the state and called the IRS rule "arbitrary and capricious," according to the report. The decision can be appealed to the Tenth Circuit Court of Appeals in Denver, and the Justice Department has indicated that is what they intend to do.

The ruling in Oklahoma adds to the mixed results in other cases challenging the rule. On July 22, a divided three-judge panel of the D.C. Circuit Court of Appeals ruled tax subsidies may not be provided in states that did not establish their own exchanges. However, just two hours later, a three-judge panel from the Fourth U.S. Circuit Court of Appeals unanimously held low- and middle-income Americans in all states can legally receive subsidies for health insurance under the PPACA.

In August, the Obama administration filed a petition for a rehearing of the D.C. Circuit case, and the petition was granted. All 13 judges of the D.C. Circuit Court of Appeals will rehear the case.  

More articles on tax subsidies:

Is health reform affordability a myth? 5 things to know 
The changing healthcare world: 7 trends to watch
Case striking down PPACA subsidies to be reheard: 10 things to know