Court Strikes Down Federal Obamacare Subsidies

By NBCNews.com

Published 07/22 2014 10:00AM

Updated 07/22 2014 10:02AM

In a potentially lethal blow to Obamacare, a federal appeals court has ruled that the federal government may not subsidize health insurance plans bought by people in states that decided not to set up their own marketplaces under Obamacare.

The law clearly says that states are to set up the exchanges. But 34 states opted not to, and the federal government took over in those states. The court ruled that federal government may not pay subsidies for insurance plans in those states.

"We reach this conclusion, frankly, with reluctance," District of Columbia Appeals Court judge Thomas Griffith writes in the 2-1 ruling, which the federal government is almost certain to appeal to the Supreme Court.

Read the original story from NBC News.

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