Court Lets Fight Continue Over O’Care Defenders’ Move To Intervene In Lawsuit


A divided federal appeals court panel on Thursday greenlit the next steps in considering an effort launched by outside Obamacare defenders to intervene in an lawsuit targeting a provision of the Affordable Care Act.

The U.S. Court of Appeals for the D.C. Circuit issued an order requesting that the dueling parties in the lawsuit, the Obama administration and the House GOP, file responses to a request from two Obamacare enrollees to intervene in the case, House v. Burwell. The move suggests that the court is likely to make a decision as to whether the Obamacare enrollees may take over the defense of the law if the Justice Department backs down from its appeal of the case under Donald Trump. House Republicans had previously asked the court to reject the enrollees’ request to consider their intervention.

House Republicans sued the Obama administration in late 2014 over the feds’ use of Treasury Department funds to subsidize insurers for what’s known as cost-sharing reductions, which keep out-of-pocket costs down for low-income consumers. The cost-sharing reductions were mandated by the ACA, but Congress has not appropriated the money for the subsidies, prompting Republicans to argue that those payments to insurers are illegal. A district court sided with the Republicans in May, but had delayed the decision so that a Trump administration could appeal it.

This latest tussle in the legal battle comes as Obamacare proponents fear that once President-elect Donald Trump is inaugurated, his DOJ will back down from defending the subsidies. Last month, the House GOP successfully sought a delay in the case’s proceedings until February to “provide the incoming President and his appointed officials time to decide whether withdrawal or settlement of the appeal is warranted.”

Health policy experts warn that, if the district court’s decision was allowed to stand or if the subsidies were otherwise eliminated, insurers could jack up premiums to make up the shortfall or even leave the individual market altogether.

Two Obamacare enrollees filed a motion last week seeking to intervene in the case. Days later, they filed an emergency motion to have the delay on the case’s proceedings partially lifted so that the court could consider its motion to intervene before inauguration day. The House GOP so far has opposed their efforts, while the DOJ has taken no stance.

Now, both parties will have to respond on the merits of the intervention by Jan. 6. The enrollees will then have until Jan. 11 to file their own reply.

“This should give the court sufficient time to decide the motion before the change of administration,” Timothy Jost, a a health law specialist at the Washington and Lee, wrote on the Health Affairs blog.