Obama Says Health Care Working; Supreme Court Upholds Law

Posted June 25, 2015 at 11:16am

The Supreme Court saved Obamacare from another critical legal challenge in a 6-3 decision Thursday that upholds health insurance subsidies for millions of low- and middle-income residents. President Barack Obama hailed the ruling.

Chief Justice John G. Roberts Jr., who wrote the ruling, joined the court’s liberals in saving a signature piece of legislation for the president. Roberts was in the majority in 2012, when the court ruled that the law was constitutional. The Thursday decision focused on a narrower issue of the meaning of the statute.

The ruling upheld an IRS rule that allowed the federal government to help pay for individual health insurance in the 34 states that didn’t set up their own health care exchanges. The states instead rely on a federally run exchange.

“Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them,” Roberts  wrote for the majority. The court’s role is to say what the law says, which is not always easy, he said.

“But in every case we must respect the role of the legislature, and take care not to undo what it has done,” Roberts wrote. “A fair reading of the legislation demands a fair understanding of the legislative plan.”

Obama said the law was “here to stay. The court upheld a critical part of this law: the part that made it easier for Americans to afford health insurance.” The president said tens of millions of Americans are benefiting from the law. “This law is working and it is going to keep doing just that. This is healthcare in America.”

House Speaker John A. Boehner, R-Ohio, and Senate Majority Leader Mitch McConnell, R-Ky., said Republicans would continue to try to repeal the law. Republicans have sought to repeal the legislation since they won control of the House in the 2010 elections.

“We will continue our efforts to repeal the law and replace it with patient-centered solutions that meet the needs of seniors, small business owners, and middle-class families,” Boehner said. “ObamaCare is fundamentally broken, increasing health care costs for millions of Americans.  Today’s ruling doesn’t change that fact.  Republicans will continue to listen to American families and work to protect them from the consequences of ObamaCare.”

McConnell said the “politicians who forced Obamacare on the American people now have a choice. They can crow about Obamacare’s latest wobble towards the edge, or work with us to address the ongoing negative impact of a 2,000 page law that continues to make life literally miserable, miserable, for so many of the same people it purported to help.”

But Republicans, who now control both chambers of Congress, are unlikely to have the votes for repeal. Senate Democrats would use procedural measures to block them and Obama would be expected to veto such a measure. In the days leading up to the high court’s ruling, Republicans were searching for a replacement in the event the court decided against the law.

Hillary Clinton, a candidate for the Democratic nomination for president and a contender to succeed Obama in 2017, said the court affirmed what the law intended: “that health insurance should be affordable and available in every state.”

She said Republicans should drop their criticism. “It’s time for the Republican attacks to end.” Clinton said the legislation “isn’t perfect, but the evidence is clear: it’s working.”

The ruling avoids a debate in Congress and the White House over how to change the health care overhaul law (PL 111-148, PL 111-152) had the Supreme Court decided a key provision did not allow the aide to 6.4 million people in the states which enrolled in individual health plans through the federal exchange.

Joining Roberts in the majority were associate justices Anthony M. Kennedy, Ruth Bader Ginsburg, Stephen G. Breyer, Sonia Sotomayor and Elena Kagan.

The majority of justices rejected the argument of a cadre of libertarian lawyers who orchestrated and funded a legal challenge that was surgically precise, focused only on a six-word phrase buried in an important part of the 906-page law.

The Supreme Court decided the phrase—authorizing subsidies for “an exchange established by the state”—makes it possible for the federal government to help pay for individual health insurance in the states that didn’t set up their own health care exchanges.

Justice Antonin Scalia wrote the dissent, which was joined by justices Clarence Thomas and Samuel A. Alito Jr.

“The terms of the law say quite plainly that tax credits are available only on an exchange established by the state,” Scalia said in court announcing his dissent. “If Congress intended a different result, it should amend the law to conform to its intent. Until it does, we have no authority to ignore the law because we believe Congress must have intended something else.”

“We really should start calling the law SCOTUSCare,” Scalia said.


Two-Step Test

The case hinged on the justices’s interpretation of what Congress meant with the law.

The law calls for a one-stop shopping spot for health insurance, called an exchange, to be set up by states. In states that decline to participate, the law says the federal government must establish and operate an exchange.

Section 36(B) authorizes subsidies for low- and middle-income residents enrolled in “an exchange established by the state.” The challengers argued that the phrase would exclude residents who signed up on federal exchanges in states that did not set up exchanges and that the IRS interpretation was wrong.

The court used a two-step framework to analyze the IRS interpretation of Section 36B First, the court determined whether the statute is ambiguous. If the language is unambiguous, the court would enforce it as written.  But the justices would have to determine whether the agency’s interpretation of ambiguous language is reasonable.

The majority found “an exchange established by the state” to be ambiguous, particularly in the context of other provisions in the law.

“The phrase may be limited in its reach to state exchanges,” Roberts wrote. “But it is also possible that the phrase refers to all exchanges—both state and federal—at least for the purposes of the tax credits.”

The majority found the law as a whole was unambiguous, however, and rejected arguments from the challengers about the way the act works. In the challengers’ view, Roberts wrote, “Congress made the viability of the entire Affordable Care Act turn on the ultimate ancillary provision: a sub-sub-sub section of the tax code. We doubt that is what Congress meant to do.”

“Had Congress meant to limit tax credits to state exchanges, it likely would have done so in the definition of ‘applicable taxpayer’ or in some other prominent manner,” Roberts wrote. “It would not have used such a winding path of connect-the-dots provisions about the amount of the credit.”

The subsidies are necessary for federal exchanges to function like state exchanges, “and to avoid the type of calamitous result that Congress plainly meant to avoid,” he wrote.

Scalia, in a scathing dissent that argues the phrase was unambiguous, said the majority decided that “exchange established by the state” means “exchange established by the state or federal government.”

“That is of course quite absurd, and the court’s 21-pages of explanation makes it no less so,” Scalia wrote. “Words no longer have meaning if an exchange that is not established by a state is ‘established by the state.’”

Scalia wrote that Congress knew how to equate two different types of exchanges when it wanted to do so, as it did in other parts of the law. He said the majority did “interpretive jiggery-pokery” with a particular end in mind.

Under all the usual rules of interpretation, in short, the government should lose this case,” Scalia said. “But normal rules of interpretation seem always to yield to the overriding principle of the present court: The Affordable Care Act must be saved.”

The case is King v. Burwell, Case No. 14-114.

.