King v. Burwell: The Affordable Care Act and the Supreme Court Meet Again

November 10, 2014

I was writing about the 6th Circuit decision in DeBoer v. Snyder, No. 14-1341. In a 2-1 ruling the Court reversed trial court rulings which gave same-sex couples the right to marry. The majority opinion is long, interesting and engaging and, in the opinion of the dissenting judge (and me), it totally misses the point. Nevertheless, the decision creates a split in the circuits, making it highly likely that the Court will take up same-sex marriage. (I will write about DeBoer soon.)

Alas, on Friday the Court granted certiorari in King v. Burwell, No. 14-114, so I it comes first. In King, “victims” of the Affordable Care Act challenged the federal government’s authority to provide subsidies to insureds who buy insurance through the federal exchange. Recall that states had the right to establish exchanges or use the federal exchange. A drafting glitch created an ambiguity, and the claims by these “victims” are not wholly lacking in merit. (But for the subsidies, the “victims” claim, they would not have to buy insurance; thus, the “unauthorized” subsidies force them to spend money for insurance or pay the penalty tax.)

The 4th Circuit rejected the claims, holding that IRS regulations permitting the subsidies control. A D.C. Circuit panel, in another case which addressed the same claims, issued a conflicting decision. However, the D.C. Circuit granted en banc review and vacated the prior decision. Thus, there is no circuit conflict right now, but the Court will consider the matter anyway, bypassing en banc review.

An excellent piece at SCOTUSblog by Abbe Gluck, a Yale Law School professor, The Grant in King – Obamacare Subsidies as Textualism’s Big Test, from Friday, November 7, is worth a few minutes of your time, even if you are not an attorney. Professor Gluck lays the issue out really well, noting most significantly that “the fundamental canon of statutory construction [is] that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme.” Guess which justice wrote those words and, as well, that the Court should adopt interpretations that do “least violence to the text” of a statute? The textualist himself, Antonin Scalia!

I also ran across Why The Supreme Court’s Power Play Is Disturbing For Obamacare, written by TPM regular Sahil Kapur. Several law professors and former Supreme Court law clerks—including Professor Gluck, a two-fer—offer comments. Most notable is the observation by Brian Fitzpatrick, a Vanderbilt Law School professor and former Scalia clerk, who sees in the granting of cert that “at least four justices believe at least five justices are pretty inclined to strike down the subsidies on the federally run exchanges as a violation of statute.”

The Court acts, and we live with the consequences. None of the justices will ever worry about or want for health care for themselves, yet they have it within their power to gut the Affordable Care Act and, perhaps, take many millions of people out of the insurance pool. Accepting review without a circuit split gives us plenty of reason to be concerned. That said, I expect we’ll have a 5-4 decision, with Chief Justice Roberts in the majority—no surprises so far—and that he will write the opinion which upholds the IRS interpretation and saves Obamacare again. No money goes down on this prediction, but it’s mine and I’ll own it!

By the by, the new open enrollment period is upon us and, contrary to all of the dire predictions, premium increases appear to be very small. Read Sticker Shock? Not. Obamacare’s Proposed 2015 Rates by Dan Mangam for CNBC last month for details.


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