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Cover Oregon Says Oregonians Will Still Get Tax Subsidies

Oregon’s troubled health insurance exchange, Cover Oregon, says a U.S. appeals court decision on tax subsidies does not affect this state.

A three-judge panel at a U.S. appeals court in D.C. has ruled that the IRS lacks the authority to allow tax subsidies in exchanges not run by the states.

Oregon established its own exchange in 2011. But the website failed for technical and other reasons, pushing Oregonians to the federal exchange next year.

That puts Oregon’s tax subsidies in question.

But the executive director for Cover Oregon, Aaron Patnode issued a statement saying the ruling doesn’t affect Oregon.

He said Oregon’s health insurance exchange is designated as a state-based marketplace this year, and next year as a quote “supported state-based marketplace.”

“A federal appeals court has ruled that the federal government cannot subsidize insurance premiums in states that did not establish their own marketplaces. Oregon established its own marketplace in 2011. Our understanding is that since Oregon’s health insurance exchange is designated as a state-based marketplace in 2014, and a supported state-based marketplace in 2015, this ruling does not affect Oregon.” — Aaron Patnode

Legal questions around tax subsidies are likely to continue.  A Virginia court upheld them and the Obama Administration has said it will appeal the D.C. decision.

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