LitigationNews

ACA’s Subsidies Upheld by Supreme Court

By March 10, 2016 No Comments

The Supreme Court’s recently ruled, 6-3, that federal health insurance subsidies under the Affordable Care Act (ACA) are legal following King v. Burwell. The court refused to apply Chevron Deference, finding that the statute was ambiguous and the federal government’s interpretation was reasonable.

The ruling means that millions will keep their legal Healthcare.gov subsidies. The IRS can continue to issue subsidies to those who buy plans on the federal website. Simply put, ObamaCare (the Affordable Care Act) remains “the law of the land.”

Anthony Kennedy, Ruth Bader Ginsberg, Stephen Breyer, Sonia Sotomayer, and Elena Kagan voted with the majority on the opinion delivered by Chief Justice John Roberts. In the opinion, Roberts writes that the tax credits are allowed “for insurance purchased on any Exchange created under the Act. Those credits are necessary for the Federal Exchanges to function like their State Exchange counterparts, and to avoid the type of calamitous result that Congress plainly meant to avoid.”

Roberts also stated, “Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the Act in a way that is consistent with the former, and avoids the latter.”

In Anthony Scalia’s dissent, he said that the Supreme Court “favors some laws over others, and is prepared to do whatever it takes to uphold and assist its favorites.”

The Supreme Court’s ruling is intended to assure consumers that the promise of affordable health coverage will still exist, and that nothing has changed in terms of their receipt of financial help. The ruling saves coverage for an estimated 6.4 million Americans who would have otherwise lost their coverage.

Others warned that a ruling in favor of the plaintiffs would have caused an adverse selection “death spiral,” as younger and healthier people pulled out of the insurance pool. This could have caused premiums to skyrocket by 47 percent.

If the GOP is to repeal or further proposed healthcare reform, the parties must address the three key points found in the law regarding the intentions of the Affordable Care Act:

  • Open Enrollment
  • Guaranteed Coverage
  • Premium Tax Credits