The fate of the Affordable Care Act will once again be in the hands of the Supreme Court next week, when it will hear arguments focusing entirely on just four words in one section of the health care law.
On March 4, the justices will gather to review the case King v. Burwell, which focuses on the federal subsidies in the form of tax breaks millions of Americans receive to afford their health insurance.
What the case is all about:
Currently 16 states plus the District of Columbia have established their own health care exchanges, while the remaining 34 states use the federal government exchange, HealthCare.gov.
This case focuses on the words “established by the State” in a subsection of the law, which those bringing the case say make clear that subsidies are only available to those individuals living in the states that have created their own exchanges.
This would mean that those who have benefited from tax credits from the Internal Revenue Service in states that only have federally run exchanges should not have received any assistance.
Should the Supreme Court rule that the IRS was wrong in offering tax credits to individuals in these states, more than 5 million people will no longer be eligible for the subsidies.
What this will mean for the Affordable Care Act:
A ruling against the government would not abolish the Affordable Care Act but it would cause some more than significant problems. Millions of people depend on their tax subsidies to afford coverage. If these people lose or cancel their insurance, not only will they be at risk because of their loss of benefits, but also the individual market premiums will spike due to the decreased number of healthy people in the pool.
Any steps for fixing the law then would be left to the GOP-dominated Congress, of which many members have already been working to break down some of the ACA’s requirements.
What the law’s opponents say:
The people challenging the law say that Congress intentionally limited subsidies in order to encourage states to create their own health care exchanges. However, when only a few were able to do so, the IRS attempted to rectify this issue by granting subsidies to everyone, whether a person lives in a state with its own exchange or one that depends on the federal government.
“If the rule of law means anything, it is that text is not infinitely malleable and that agencies must follow the law as written – not revise it to ‘better’ achieve what they assume to have been Congress’s purposes,” wrote Michael Carvin, a lawyer for the challengers, in a court brief.
What the law’s supporters say:
The administration affirms that consumers in all 50 states are eligible for tax credits from the IRS, as Congress would never have passed a law that omits so much of the nation from receiving its benefits.
They say that attempting to isolate and analyze the meaning of four words within a massive law ignores its clear overall intentions. Several portions of the law indicate that consumers can claim tax credits regardless of where they live, as the central purpose of the law was to make health care affordable for all Americans.