Law360, New York (July 23, 2014, 12:15 PM EDT) -- Backers of the Affordable Care Act suffered an unexpected blow Tuesday when the D.C. Circuit in Jacqueline Halbig, et al. v. Burwell, et al. invalidated an Internal Revenue Service regulation extending federal subsidies to individuals who purchase health insurance on federal exchanges. The 2-1 ruling surprised many observers that viewed the case as little more than a long-shot, partisan effort to derail the law. Under Halbig, individuals who purchase insurance on an exchange run by the federal government would be ineligible for a subsidy, meaning that fewer people will be able to afford this type of coverage. And, the ruling would invalidate the ACA's employer mandate "play-or-pay" tax in most of the states....