SCOTUS nears ruling on federal Obamacare subsidies

King v. Burwell, the latest Supreme Court case to examine the Affordable Care Act (ACA), is drawing to a close.

Speculation has arisen over the future of the federal Health Insurance Marketplace that serves most of the nation in the two months since the plaintiff broached whether language regarding the federal exchange’s role in delivering subsidies conflicts with its mission to make health care more accessible to more Americans. How lawmakers will respond to the court’s ruling, which could invalidate the federal exchange if it sides with the plaintiff, has been ruminated by Republicans and Democrats alike as momentum starts to build for the 2016 general election.



The Supreme Court is deciding whether the federally facilitated exchange that’s part of the Affordable Care Act is valid in light of unclear wording. East facade of SCOTUS building courtesy of Creative Commons

The ACA was constructed with the creation of state-run exchanges in mind, in which eligible individuals could purchase a health insurance plan with federally issued subsidies to lower their monthly premium. When only 13 states set up their own exchanges, mostly due to staunch opposition from conservative states, the federal exchange delivered subsidies to people living in the 37 states that did not set up their own exchanges. 11.4 million people enrolled in a health plan for 2015 coverage during‘s second open enrollment period, which was extended with a special enrollment period due to confusion over tax penalties for not having prior coverage.

The New York Times’ Frequently Asked Questions page for the case notes the plaintiff has been persuading the court to uphold the literal interpretation of the law’s “established by the states” language to invalidate subsidies delivered through the federal exchange. As the defendant, the federal government argues “the phrase is a term of art, which Congress intended to mean both state and federally run marketplaces.” It adds that the law as whole references both state and federal exchanges as means of delivering subsidies to eligible individuals.

Though the FAQ notes a ruling in favor of the defendant could be based on the Supreme Court’s precedent in ruling that Congress ultimately decides how to interpret its own confusing language, a ruling in favor of the plaintiff would be a victory for the health care law’s opponents because it would substantially limit how the government may continue implementing ACA. A ruling in favor of the plaintiff would not equal an outright repeal of the health care law, which Republicans have repeatedly called for.

Bloomberg News commentator Noah Feldman writes the court’s recent ruling in U.S. v. Kwai Fun Wong, which upheld the concept of equitable tolling in light of unclear procedural language in the Federal Tort Claims Act, might guide the court as it decides whether the federal exchange remains a valid means of delivering subsidies in light of its own legal murkiness.

Though no official response has been prepared by Republicans, The Hill reports Rep. John Barrasso (R – Wyo.) has been leading meetings among party members to discuss what to do if the court rules in favor of the plaintiff. Conservatives have been sensitive to a change in leadership tone that supports revision rather than a total repeal of ACA; this may be the GOP’s way of  mollifying voters who are anxious about losing their coverage as multiple party members announce their run for the presidency.

The Hill also reports that Democrats in Congress, who are no longer the majority, would most likely work to pass a revision to the original language to bring direct clarity to the issue should the court decide against the Obama administration.

The court is expected to reach a decision by the end of June.

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