Supreme Court upholds ObamaCare subsidies

by Sarah Ferris and Peter Sullivan - 06/25/15 10:10 AM ET

The Supreme Court has upheld a key provision of ObamaCare, affirming that 6.4 million people can continue to receive subsidies that allow them to purchase healthcare plans.

The 6-3 decision authored by Chief Justice John Roberts is a huge victory for President Obama; it ensures that consumers purchasing health insurance on the federal exchange in roughly 34 states will continue to be able to do so.

{mosads}In his decision, Roberts argued that a ruling killing off the subsidies would set the state markets into a death spiral, and that this could not have been the intent of Congress.

“The combination of no tax credits and an ineffective coverage requirement could well push a State’s individual insurance market into a death spiral. It is implausible that Congress meant the Act to operate in this manner,” he wrote.

“The argument that the phrase ‘established by the State’ would be superfluous if Congress meant to extend tax credits to both State and Federal Exchanges is unpersuasive.

In a dissent, Justice Antonin Scalia lambasted the Obama administration for what he called the “somersaults of statutory interpretation” in the healthcare law.

“We should start calling this law SCOTUScare,” wrote Scalia, in an unsubtle reference to an earlier decision written by Roberts that declared constitutional the law’s mandate that people buy insurance.

Fellow conservative Justices Samuel Alito and Clarence Thomas joined Scalia’s dissent.

The court’s four liberal justices joined the Roberts opinion, as did Justice Anthony Kennedy, who is often a swing vote on the court.

Roberts had been unusually quiet in the oral arguments over the case, leading many to speculate he would rule in favor of ObamaCare for the second time in three years.

He not only did so, but also authored the majority opinion saving the law from a devastating defeat.

“Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the Act in a way that is consistent with the former, and avoids the latter” he wrote.

The case, King v. Burwell, represented the biggest legal threat to ObamaCare since the Supreme Court ruled the law was constitutional three years ago.

It puts an abrupt end to the years-long challenge from conservatives, led by the Competitive Enterprise Institute, that have levied a half-dozen other lawsuits against the five-year-old law.

The challengers argued that the Affordable Care Act only allowed subsidies to be used in marketplaces “established by the state,” which they said excluded those on the federal marketplace.

A total of about 34 states use the federal HealthCare.gov website, with an estimated 6.4 million people getting subsidies there that help them purchase insurance.

The Obama administration argued that conservatives were taking the four-word clause out of context and that those involved in drafting the law had intended the subsidies to be available in all states.

Roberts and the other justices joining his opinion agreed.

In his highly technical explanation that cites from a law dictionary, Roberts writes that the state and federal exchanges were intended to be the same.

“They must meet the same requirements, perform the same functions and serve the same purposes,” he wrote, adding that the law does not suggest that they would “differ in any meaningful way.”

Roberts also acknowledges the imperfect way that the Affordable Care Act’s language was drafted, in a nod to the plaintiffs’ arguments and the dissenting justices.

Citing the disputed clause in the law that says subsidies should go to exchanges “established by the state,” Roberts acknowledges “that’s a problem.”

But he then continues to defend the ultimate meaning of the law.

“The meaning of that phrase may not be as clear as it appears when read out of context.”

Roberts chose not to apply the framework of “Chevron deference,” which would have permitted an agency’s interpretations of an ambiguous statute, as some lawmakers and court-watchers had expected.

“Had Congress wished to assign that question to an agency, it surely would have done so expressly,” Roberts wrote.

“It is especially unlikely that Congress would have delegated this decision to the IRS, which has no experience in crafting health insurance policy of this sort.”

In the final words of his opinion, Roberts appears to acknowledge the opposition that he will face for again upholding the embattled law.

“In a democracy, the power to make the law rests with those chosen by the people. Our role is more confined,” he writes.

“That is easier in some cases than in others. But in every case, we must respect the role of the Legislature and take care not to undo what it has done.”

Tags King v. Burwell ObamaCare ObamaCare ruling Supreme Court