Linda Tiano Quoted in “Restricting Subsidies to State Exchanges Is Unlikely, but Would Seriously Alter ACA”

Inside Health Insurance Exchanges

Linda Tiano, a Member of the Firm in the Health Care and Life Sciences practice, in the firm's Washington, DC, and New York offices, was quoted in an article titled "Restricting Subsidies to State Exchanges Is Unlikely, but Would Seriously Alter ACA."

Following is an excerpt:

Dueling appeals court rulings issued July 22 once again call into question the legality of federally run exchanges distributing premium subsidies to enrollees. While some industry observers tell HEX it's unlikely the case will ever make it to the Supreme Court, others are certain that's where it's headed. A ruling that prevents federally run exchanges from distributing subsidies, they say, would effectively end both the employer and individual mandates, and could prompt insurance carriers to launch a new wave of low-cost coverage options.

The DC Circuit judges looked at the language in the statute and felt the language was clear and unambiguous, notes Kara Maciel, an attorney in Epstein, Becker & Green's Labor and Employment, Litigation, and Health Care and Life Sciences practice.

"If it winds up preventing subsidies through federally run exchanges, it would be a big deal. I don't think most people believe that's going to be the outcome," says Linda Tiano, an attorney at the law firm Epstein, Becker & Green, P.C. "The intent of the law is pretty clear that [the ability to distribute subsidies] would apply to all of the exchanges. It's just a wording error…but everything related to this law is very political."

A ruling against the subsidies could be good news for employers because it would likely mean the end of the employer mandate, says Maciel. Some small employers are struggling with how they are going to comply with the "pay or play" provision of the ACA. "They would have a little more breathing room if there isn't an employee triggering the [employer mandate] provision," she tells HEX.

If the Supreme Court were to agree that federal premium subsidies are available only through state-run exchanges, states could sidestep the ruling by moving to a state-partnership model. "It doesn't require the states to do very much, and they would still contract with the federal exchange for most of the work," Tiano explains. "There are a variety of ways it could be fixed."