King v. Burwell: Supreme Court to Decide

By Sumita Saxena, Senior Consultant, The Verden Group

Just when you thought it was safe to say “Obamacare” . . .

In breaking news, the U.S. Supreme Court unexpectedly agreed this past Friday to hear the King v. Burwell case next year. What hangs in the balance is whether federal premium subsidies will be upheld or invalidated in 36 states. If those subsidies are invalidated, it will most likely result in millions of people losing health insurance because they won’t be able to afford the premiums.

This case harkens back to 2012 when the court was sharply divided in the ruling upholding the constitutionality of the Patient Protection and Affordable Care Act.

The case focuses on whether the ACA’s language allows consumers to receive premium tax credits in the 36 states relying on the federal HealthCare.gov exchange. Experts anticipate the court will issue its ruling around June 2015. Specifically at issue is language in the law which says that tax credits are only available to people who are enrolled “through an exchange established by the state.” The Obama administration is arguing that the law’s unequivocal intention was to offer subsidies and expand coverage to Americans in every state, and that other provisions support this intention. Proponents of the law explain the inconsistency as a drafting error, borne from the painstaking process it took to pass the law.

If the subsidies are held invalid in these 36 states, it could very well lead to undermining any reform with steep increase in premium cost and millions being unable to afford it. 5.4 million people signed up for coverage in 2014 through the federal exchange, with the majority of those consumers receiving subsidies.

Experts have talked about the option for states to establish their own exchanges before the ruling, but they are skeptical that will happen – it’s expensive and difficult.

Chief Justice Roberts is largely regarded among experts as the one the decision will depend on. Kermit Roosevelt, a constitutional law professor at the University of Pennsylvania Law School, has been quoted as saying “I could see (Roberts) either saying ‘the Affordable Care Act is here to stay’ and siding with the government, or ‘Congress made a mistake, and we’re not doing anything wrong by enforcing the law the way it’s written.”

I wonder what Obama will be expressing gratitude for this Thanksgiving . . . what a week.