Legal Battle Over Affordable Care Act Subsidies Heats Up
King v. Burwell could affect the health insurance of millions in 37 states if the ACA is found at fault.
- The Affordable Care Act has been shackled with political and legal unrest since originally being proposed. A new battle is just gearing up in the U.S. Supreme Court, as a showdown happens over whether tax credits are available to consumer shopping on the Affordable Care Act’s federal marketplaces.
Law 360 released a breakdown of the 57-page brief in King v. Burwell, which will be argued on March 4, 2015. The argument is that Congress only authorized tax credits on health insurance exchanges created directly by states, as opposed to those created through the Department of Health and Human Services on behalf of the states. This is based on a provision of the AVA and the phrase “established by the state,” which challengers believe encompasses all exchanges.
The brief calls this case “extraordinarily straightforward.” It adds that there is no legitimate way to construe the phrase in question to include one “established by HHS.” The ACA is silent on subsidies being given to enrollees on a federal exchange.
“The same Congress imposed conditions on Medicaid funds, which are more important and more entrenched than the new subsidies, belying any notion that the ACA would refrain from conditioning federal funds if they were viewed as highly desirable,” the brief said.
Supporters of the subsidies claim they are legal given the overall intent of the ACA to provide health coverage to the uninsured, coupled with language about creating a federal exchange in the event states fail to build their own.
In a press conference earlier this week, Health and Human Services Secretary Sylvia Burwell spoke about the case and expressed confidence that the administration will be able to win this case, which challenges the legality of billions of dollars in subsidies. She refused to talk about contingency plans in the effect that an adverse ruling is handed out.
“What we’re doing right now is focusing on open enrollment,” said Burwell. “We believe we are in a place where our argument and our position will prevail.”
If the ruling is to go against the administration, it would end the subsidies in 37 states, invalidating financial aid. It would also leave sicker, older customers in the plans, because they would be the ones most anxious about maintaining coverage. That could lead to higher premiums.
Washington and Lee University School of Law Professor and ACA expert Timothy Jost told CNBC that he believes the administration will have the upper hand when a decision is finally reached. He said that the plaintiffs are hoping the Supreme Court justices will cherry pick four words out of a 900-page statute.
“It seems to me the administration has done their job, they’ve properly interpreted the statute,” Jost said.
He added that ruling against them with deprive millions of people from health insurance and healthcare. This is something that the court will need to be take into account.
