WASHINGTON -- A federal judge struck down a portion of the Patient Protection and Affordable Care Act on Thursday, ruling that President Barack Obama exceeded his executive authority in unilaterally funding a provision that has subsidized billions of dollars of insurers' costs.
In a 38-page decision, U.S. District Judge Rosemary Collyer for the District of Columbia stayed the ruling's effect pending the administration's certain appeal. Her decision sided with the House of Representatives, which filed the lawsuit challenging more than $175 billion of spending after a party-line vote by Republicans in July 2014.
The GOP argued that the Obama administration's decisions to fund payments to reduce deductibles, copays and other "cost-sharing" were unconstitutional, saying lawmakers rejected an administration request for funding in 2014.
Obama administration officials said they withdrew the request and spent the money, arguing that the subsidies were covered by an earlier, permanent appropriation.
"The question is whether Section 1402 can nonetheless be funded through the same, permanent appropriation. It cannot," Collyer wrote, referring to the provision in question.
"None of [the administration's] extra-textual arguments -- whether based on economics, 'unintended' results, or legislative history -- is persuasive," added Collyer, an appointee of President George W. Bush. "The Court will enter judgment in favor of the House of Representatives and enjoin the use of unappropriated monies to fund reimbursements due to insurers under Section 1402."
House Speaker Paul Ryan called the decision "an historic win for the Constitution and the American people."
"The court ruled that the administration overreached by spending taxpayer money without approval from the people's representatives," he said in a statement.
In a briefing Thursday after the decision, White House spokesman Josh Earnest called the lawsuit a new low in the battle over the health care law and predicted the ruling would be overturned by the U.S. Court of Appeals for the D.C. Circuit because it charted new ground in the separation of powers between presidents and Congress.
"This is the first time in our nation's history that Congress has been allowed to sue the executive branch over the interpretation of the statute," Earnest said. He criticized Republicans for using taxpayer money to "refight a political fight that they keep losing."
"They've been losing the fight for six years and they'll lose it again," Earnest said.
About 12.7 million people are covered through insurance markets created by the health care law. The subsidies help lower-earning customers afford out-of-pocket costs, such as annual insurance deductibles and co-payments when they seek medical care.
These subsidies, called "cost-sharing reductions," are separate from the financial aid provided under the law to help people pay their monthly premiums, which would not be affected.
Without the subsidies, millions of people may not be able to afford to use their health insurance. The most popular policies are skinny plans with low monthly premiums but high deductibles and copayments. The average annual deductible for a silver plan -- the kind picked by about 7 in 10 customers -- is nearly $2,900, according to the consulting firm Avalere Health.
Under the law, insurers have to provide cost-sharing assistance to consumers picking a silver plan who make up to 2½ times the federal poverty level, which is $60,750 for a family of four.
In arguments before Collyer last May, Justice Department attorney Joel McElvain called Congress' complaint legally invalid and unprecedented in asking the courts to referee a political dispute that Congress could resolve by revoking the law, passing new legislation or withdrawing funding, among other things.
"There are any number of other tools the legislature can use to influence the executive branch ... which is why we have not seen a lawsuit like this in over 230 years," McElvain said.
Collyer, who takes senior status this month and becomes presiding judge of the Foreign Intelligence Surveillance Court, in her ruling blocked further spending "until a valid appropriation is in place."
The case revives a battle over the health care law that the U.S. Supreme Court had settled last June in a 6-3 ruling.
U.S. Chief Justice John Roberts upheld health insurance subsidies to qualifying Americans against a challenge that claimed the law authorized only tax credits for those who buy insurance on marketplaces "established by the state."
Roberts agreed with administration lawyers that millions of people served by federal exchanges authorized for states that did not set up their own exchanges were lawful, reasoning that Congress' intent was clear and that was the only way the law would work, even though the legislation's wording was problematic.
The House GOP lawsuit, House of Representatives v. Burwell, was aimed at the Treasury and Health and Human Services departments and took another tack.
The suit challenges the constitutionality of billions in subsidies to insurance companies that the government expects to issue over 10 years on behalf of taxpayers who sign up for coverage in federal or state-run health exchanges.
Information for this article was contributed by Spencer S. Hsu of The Washington Post and by Sam Hananel and Ricardo Alonso-Zaldivar of The Associated Press.
A Section on 05/13/2016