Two opposing court rulings issued Tuesday sowed confusion about whether 4.7 million Americans can keep their Obamacare subsidies.
A federal appeals court panel in Washington, D.C., ruled Tuesday morning that individuals cannot use tax credits or subsidies to buy health insurance on the federal exchange, healthcare.gov.
A few hours later, another set of appeal judges in Richmond, Va., unanimously upheld the ability for people applying for coverage on the federal exchange to receive subsidies.
The Obama administration said it plans to appeal the D.C. court ruling.
For Americans receiving subsidies, nothing will change until the legal court battle ends. People in the 14 states and Washington D.C. that run their own exchanges would not be affected by these rulings.
Subsidies are key to the Affordable Care Act's success: About 87% of those who signed up for Obamacare plans on healthcare.gov received them.
Many people feel they cannot afford health insurance without help.
The subsidies limit the cost of coverage to no more than 9.5% of one's income for those who qualify. Those eligible for subsidies paid an average of $82 a month, compared to $346 without assistance, the administration said last month.
"These subsidies are extraordinarily important," said Ron Pollack, executive director, Families USA, a consumer group that supports Obamacare. The assistance makes a "critical difference" in whether low- and moderate-income Americans can afford coverage.
Anyone earning up to 400% of the poverty line -- up to $45,960 for an individual and $94,200 for a family of four -- was eligible for a premium subsidy during the initial open enrollment period, which ended March 31. Additional cost-sharing subsidies are available to those with incomes below 250% of the poverty line.