December 09, 2014 Articles

The ACA's Muddled Application of the FCA to Health-Insurance Exchanges

An example of the ACA's rushed enactment and poor drafting is a new section that purports to apply the False Claims Act to health-insurance exchanges.

By Christopher R.J. Pace

Those familiar with the Patient Protection and Affordable Care Act (ACA) are well aware of its highly irregular procedural history and drafting errors. The procedural gaming included a key Christmas Eve vote (the first such Senate vote since 1895), an agreement before the ACA was passed for the president to enter an executive order to not enforce one of the ACA’s provisions, and the use of the budget reconciliation process to make substantive “fixes” to the ACA. See Amicus Brief of Center for Constitutional Jurisprudence, et al., U.S. Dep’t of Health & Human Servs. v. Florida, No. 11-398 (U.S. filed Feb. 18, 2012). The drafting issues included a provision that allows tax subsidies for persons purchasing health insurance through exchanges established by states, but do not include exchanges established by the federal government (which, as it turned out, established most of the exchanges). See “Could One Word Take Down Obamacare?,” Washington Post wonkblog(July 16, 2012). (The U.S. Supreme Court recently granted certiorari to decide whether these tax subsidies are available to persons purchasing insurance through federal government-established exchanges. See King v. Burwell, No. 14-114, 83 U.S.L.W. 3286 (Nov. 7, 2014).)

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