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Supreme Court Deciding on Obamacare Subsidies

After listening to arguments in the case that might seal the Affordable Care Act’s fate, Supreme Court justices seemed sharply divided on whether tax credits are lawfully provided to citizens from all states purchasing healthcare coverage individually.

Low- and moderate- income citizens from roughly three dozen states are currently in a particularly difficult situation. Because the states they reside in did not set up state-run exchanges, they are forced to rely on federal exchanges. Yet it isn’t clear whether these residents are eligible for subsidies to help pay for their premiums. While the Obama administration insists that subsidies shouldn’t be conditioned on where applicants live (such a scenario would lead, they say, to a steep decline in enrollment and an increase in premiums), opinions are divided.

Such was the resolve of the court that over 90 minutes of Wednesday’s scheduled were spent discussing one single phrase of the 2010 law. Four precise words represent the focus of the discussion: “established by the state”. Because this phrase has little to no legislative history, the Supreme Court justices are put in the delicate position of actually guessing what Congress meant. Challengers of Obama’s health law insist that Congress meant for subsidies to be awarded only to those people living in states which had created health insurance marketplaces. However, Justice Anthony Kennedy raised an important point: had such a scheme been intended, a significant constitutional question would have followed. In effect, it would have meant that the federal government would have coerced states to act.

In this third major Supreme Court Case involving Obama’s healthcare law, the fate of health law subsidies lies with Justice Anthony Kennedy and Chief Justice John Roberts. Their vote will essentially determine whether moderate- and low-income Texas, Oklahoma and 35 other US states residents would receive subsidies in order to acquire the health coverage they would otherwise not be able to afford.

The four liberal justices clearly swayed towards the Obama administration’s view that healthcare applicants should be provided subsidies regardless of the way they acquired the coverage )through state-run exchanges or federal exchanges).

While Justice John Robert’s vote three years ago helped save the Affordable Care Act, Justice Anthony Kennedy has always been a fierce opponent of the law. In this ceaseless struggle and Republican-led efforts to dismantle the Affordable Care Act, Justice Kennedy would have made sure that the present case wouldn’t have existed as there wouldn’t have been any Affordable Care Act to begin with. His votes were often decisive in those cases where liberals and conservatives remained torn and back in 2012, he was one of the four who would have simply overruled the entire law.

Kennedy’s position was simple: if Congress had intended to coerce states to create state-run exchanges in order to insure that citizens could be eligible for subsidies, this would have constituted a“serious constitutional problem.”

“[If] states are being told either create your own exchange or we’ll send your insurance market into a death spiral.”

Kennedy said.

And while Kennedy’s comments were clearly heard in the courthouse, Chief Justice John Roberts had a noticeable silent approach. Although Justice Roberts never fails to get questions in during such arguments, it may just be that his Wednesday approach was deliberate. Michael Carvin, the challenger’s attorney, noted that inferring anything from the Chief Justice’s silence would be nothing short of a fool’s errand.

Donald B. VerrilliJr., Solicitor General representing the Obama administration, informed justices that no US state would have the time to prepare state-run exchanges in order to make sure that subsidies are provided if they were struck down by the court. Such of scenario would mean that millions of citizens would lose coverage. He added that Congress had meant for the law to be read broadly because of the very purpose the law served: to ensure that the uninsured are given better chances of acquiring healthcare coverage.



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