Supreme Court Obamacare Fight Over Four Words Could Affect Healthcare for Millions

By Dan Roberts, The Guardian

04 March 15

emocratic lawmakers have launched a last-ditch effort to defend the Affordable Care Act from a looming supreme court challenge that could strip health insurance from millions of Americans.

The court is due to hear an appeal on Wednesday that seizes on what appears to be a drafting error in the original legislation to question a key plank of Barack Obama’s health insurance reforms.

Plaintiffs led by Virginia limousine driver David King sued health secretary Sylvia Burwell on the grounds that the error means they were compelled to pay for health insurance they did not want and would otherwise have been exempted from because it was too expensive.

This seemingly perverse argument rests on the way the law allows for tax credits to bring down the cost of health cover in states that run their own insurance exchanges.

But the original language in the legislation does not appear to include states like Virginia which rely on the federally administered exchange instead, threatening millions that have already benefitted from the tax credit in this way.

The administration argues this omission was just an oversight, and most legal experts believe the court ought to acknowledge the apparent intent of lawmakers to include federal exchanges too.

But concern is growing among Democrats in Washington that the conservative-leaning court may nevertheless favour a strict literal interpretation of the legislation as a way to fatally undermine Obamacare.

The court narrowly struck down a similar legal challenge at the outset of the reforms when Chief Justice John Roberts surprised many conservatives by supporting the president.

This time, critics of Obamacare point to a supporting statement filed by several Republican senators claiming the legislative language was deliberately narrow.

Senators John Cornyn, Ted Cruz and Marco Rubio claim the broader interpretation subsequently adopted by tax authorities “violates the separation of powers by unraveling the specific compromises crafted by Congress”.

They argue instead that states would simply have more incentive to set up their own exchanges if the law was correctly interpreted and tax credits removed from federal exchanges.

“The very strong possibility that states would establish their own exchanges in reaction to the unavailability of subsidies for insurance purchased on a federally established exchange cuts strongly against the Government’s suggestion that interpreting [the] section ... according to its clear textual meaning ‘runs counter to [the] central purpose of the ACA’,” argue the Republican senators.

Such is the risk that the supreme court sides with this view in King v Burwell that Democratic lawmakers took to the floor of the Senate on Tuesday to accuse the plaintiffs of “cherry-picking and contorting a four-word phrase”.

“If Congress intended for the tax credits to help only some Americans, Congress would have said that,” argued Senator Ron Wyden, who claimed lawmakers would not deliberately “slip [in] a poison pill” in this way.

“The wrong decision could make quality health insurance unaffordable for millions of Americans from one end of the country to another, and the negative outcome could radiate across our healthcare system,” he warned.

“It would send our country back to the dark days when healthcare was for the healthy and the wealthy.”

The stakes have been raised by the fact that the White House does not appear willing to make preparations for a negative outcome.

“If they rule against us, we’ll have to take a look at what our options are,” Obama told Reuters in an interview on Monday. “But I’m not going to anticipate that. I’m not going to anticipate bad law.

“This should be a pretty straightforward case of statutory interpretation,” he argued. “If you look at the law, if you look at the testimony of those who were involved in the law, including some of the opponents of the law, the understanding was that people who joined the federal exchange were going to be able to access tax credits. Just like if they went to a state exchange.”