Houston Chronicle - Supreme Court Upholds Healthcare Law Subsidies

News Article

Date: June 25, 2015
Location: Washington, DC

By Jenny Deam and Kevin Diaz

A divided U.S. Supreme Court on Thursday turned back a conservative challenge that threatened to strip health insurance for millions of people in states like Texas that didn't set up their own state-based exchanges under President Barack Obama's signature health care law.

The long-anticipated, 6-3 decision is the second high-court victory for the Affordable Care Act, which extended federally subsidized health insurance to an estimated one million people in Texas, the state with the largest share of uninsured residents.

Chief Justice John Roberts wrote for the majority stating that "Congress passed the Affordable Care Act to improve health insurance markets not to destroy them." He was joined by Justices Anthony Kennedy, Ruth Badar Ginsburg, Stephen Breyer, Sonia Sotomayor and Elana Kagan.

Justice Antonin Scalia, in the dissent, took his fellow justices to task, contending that the court overstepped its duties in interpreting the language of the law. "We should start calling this law SCOTUScare," he wrote in the dissenting opinion, inserting the acronym of the Supreme Court into what has become known as Obamacare.

He was joined in his dissent by Justices Clarence Thomas and Samuel Alito.

The ruling in King v Burwell on Thursday upheld a Fourth Circuit Court of Appeals decision that said the wording of a portion of the Affordable Care Act establishing subsidies for those who signed up in state exchanges could be interpreted to include all who signed up, including those who used a federal exchange.

Although agreeing in principle with the lower court, Roberts was critical of the language of the law which he described as "inartful drafting."

Opponents had seized upon four words in the voluminous law -- "established by the state" -- and built an argument that when taken as the letter of the law it meant that Congress had meant for only residents in states which created exchanges should be eligible for tax subsidies. Roberts acknowledged in his opinion that such an argument was "strong."

Yet in the end, the same justice who delivered a victory to the White House in 2012 in the first Supreme Court challenge to the law, ultimately decided: "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."

Reaction in Texas to the high court decision came swiftly. Less than an hour after the decision Gov. Greg Abbott wrote in a statement: "The Supreme Court abandoned the Constitution to resuscitate a failing healthcare law. Today's action underscores why it is now more important than ever to ensure we elect a President who will repeal Obamacare and enact real healthcare reforms."

He was joined by Eighth District U.S. Rep. Kevin Brady, R-The Woodlands, who echoed the governor's disgust. "This Supreme Court ought to get an Olympic gold medal for the torturous legal gymnastics it displays shoring up the unconstitutional and unworkable Affordable Care Act. Apparently words in law simply don't matter," he told the Chronicle.

However, proponents of the law found delight in the decision. "It's a good day," said Elena Marks, a fellow in health policy at Rice University's Baker Institute and well as the president and CEO of the Episcopal Health Foundation.

Lawmakers and health officials nationwide had watched the case with growing unease, preparing for the possibility that the high court might upend one of the most fundamental aspects of the health care law. Such a ruling, White House spokesman Josh Earnest said earlier in the week, had the potential to throw the nation's health care system into "utter chaos."

Instead, the administration and its Democratic allies in Congress won a resounding reprieve from the ongoing Republican onslaught. Marks said Thursday she was hopeful this second Supreme Court affirmation "send a signal that the Act is here to stay."

"After more than 50 votes in Congress to repeal or weaken this law, after a presidential
election based in part on preserving or repealing this law, after multiple challenges to this law before the Supreme Court, the Affordable Care Act is here to stay," President Obama said after the decision was announced. "Today is a victory for hard working Americans all across this country whose lives will continue to become more secure in a changing economy because of this law."

But the fight may not be over. "We're going to continue to fight until Americans are free of this law," Brady said Thursday.

A decision dismantling federal subsidies would have hit hard in Texas, where Republican leaders also chose not to expand Medicaid, leaving another 1.5 million eligible Texans without coverage.

Thirty-four states, including Texas, chose not to create their own online marketplaces and instead relied on federally-sponsored exchanges.

Critics of the law have said the wording of the law was by design to coerce states like Texas to establish exchanges.

Affordable Care Act defenders called it a technical drafting error that did not conform to the rest of the landmark law, the most dramatic overhaul of the nation's health care system since the passage of Medicare and Medicaid in 1965.

Far from a glitch, the law's opponents contended that the law was purposely drafted that way to coerce states into establishing their own exchanges.

Texas conservatives and their Republican allies in Congress overwhelmingly supported the challenge to a law they have long considered deeply flawed. But the case has been surrounded by pointed debate about what to do with more than 6 million people in states using the federal exchange who could have lost their coverage.

If they had won, some Republican leaders -- wary of a political backlash -- supported a temporary extension of subsidies, perhaps until past the 2016 elections. That would also have permitted what Texas U.S. Sen. John Cornyn called "a transition into more of a free market opportunity outside of Obamacare."

But hardliners like Texas U.S. Sen. Ted Cruz, a GOP presidential candidate, opposed the extension of subsidies they consider illegal. They advocated instead for states to "opt out" of the law's mandates requiring insurance, which would all but gut it. Texas Governor Greg Abbott, similarly, this week wrote a blistering attack of the law in the National Review Online, urging governors across the nation to "just say no" to the law.

While Democrats accused Republicans of offering no alternative or "Plan B," Republicans charged that the Obama administration had done little if anything to prepare for the possibility of an adverse Supreme Court ruling.

In the end, it didn't prove necessary. But Republicans, who saw the case a spear in the heart of Obamacare, have promised not to give up the fight.

"There is an absolute commitment long term to repealing Obamacare," said Cornyn, the Republican Whip, in the lead-up to the court's decision. That vow also has been a mainstay of the 2016 GOP presidential nominating contest, particularly for Cruz, who mounted a 21-hour filibuster-like speech against the law in 2013.