The Obama administration is defending its health care law in court, arguing that the text of the law and Congress' intent allow Americans to receive insurance subsidies regardless of whether they're enrolled through insurance markets run by the states or by the federal government.
In a federal appeals court filing, the Justice Department on Monday disputed opponents' contention that the law limits tax credits for low- and moderate-income consumers only to those who live in states that have set up their own insurance markets, or exchanges.
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The administration's court filing came in a challenge to the law known as "Obamacare" that will be argued before the full U.S. Court of Appeals for the District of Columbia Circuit on Dec. 17.
The Justice Department said the tax credits are indispensable to the functioning of the Affordable Care Act's exchange-based system.
"Unsurprisingly, the act's text and structure demonstrate that those federal tax credits are available to Americans in every state," the administration's filing stated.
The government said a close reading of the law shows that it requires federally run exchanges to report information to the Treasury Department, so that it can verify that subsidy amounts are correct and in line with a recipient's reported income.
"It would make no sense to require federally facilitated exchanges to submit those reports if tax credits were categorically unavailable to their customers," the court papers stated.