On June 25, the U.S. Supreme Court ruled in a 6-3 decision that
consumers who purchase health insurance in "federally
facilitated exchanges" established under the Affordable Care
Act (ACA) can continue receiving subsidies. The Court's
opinion in the highly anticipated case, King v. Burwell,
was written by Chief Justice John Roberts, who also wrote the
2012 opinion upholding the ACA's individual mandate as a valid
exercise of Congress's taxing power.
The King v. Burwell plaintiffs had argued that those who
purchase insurance in the 34 exchanges operated for states by the
federal government should be ineligible to receive tax credits
intended for insurance purchased on exchanges "established by
the state," in the words of the ACA. The Court found
that this language is "properly viewed as ambiguous," but
that the ACA's "context and structure compel the
conclusion that [the ACA] allows tax credits for insurance
purchased on any Exchange created under the Act," whether
operated by a state or by the federal government.
Almost 6.5 million people have purchased insurance on federally
operated exchanges thus far. Had the Court invalidated
subsidies for these purchases based on the ambiguous language,
quick Congressional action - by no means guaranteed - would likely
have been necessary to avoid (in the Court's words)
"destabiliz[ing] the individual insurance market in any State
with a Federal Exchange," because the ACA's goal
of making insurance affordable for all is highly dependent on the
availability of subsidies.
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