For Obamacare supporters, it was déjà vu all over again. Another challenge in the Supreme Court with potentially fatal consequences for the law, and the outcome very much in doubt.
The law narrowly survived the first challenge in 2012, when Chief Justice John Roberts cast the deciding vote to uphold the mandate that all Americans maintain health insurance. It lost in 2014, when the Court struck down a mandate that employers cover contraceptives, but that was a mere flesh wound, since this provision is peripheral to the law's overall scheme.
A loss this time, in the case of King v. Burwell, would be serious. In 34 states that rely on the federal government to run their insurance exchange, residents would no longer be eligible to receive subsidies to help cover the cost of coverage. That would force thousands of insurance purchasers out of the market. Those who remained would likely be among the sickest, making it difficult for insurers to spread the risk and leading to a possible market collapse.
The challenge revolves around four words in a provision that describes the subsidies. It authorizes financial help for insurance purchased on an exchange that is "established by the State." The challengers claim this means that subsidies are not available on the federal exchange. The Obama administration claims the four words are a drafting error, and the challengers' interpretation conflicts with the law's clear purpose and overall scheme.
At oral arguments last Wednesday, the justices appeared split. The four liberals clearly supported the administration, while two of the conservatives, Justices Samuel Alito and Antonin Scalia, clearly sided with the challengers. A third conservative, Justice Clarence Thomas, stuck to his customary silence, but he usually takes the conservative side. (For my full report on the Supreme Court hearing, click here.)
That leaves the fate of the law in the hands of the Court's other two members – Chief Justice John Roberts and Justice Anthony Kennedy. Both were difficult the read.
The regular contributors to the Field Clinic blog had a range of reactions to the case and its possible impact. Here is what they had to say:
Wharton health economist Mark Pauly predicted, based on his economic analysis, that the insurance markets in the 34 states will survive, but in a drastically shrunken form. "Many of those who got subsidies would drop out—which will put us back where we were before ACA (about 5-10 million more uninsured)."
The prospect of a shrunken insurance market is a major concern for Andy Carter, president and CEO of the Hospital & Healthsystem Association of Pennsylvania. "The outcome of this Supreme Court ruling is crucial to preserving the health and productivity of 380,000 Pennsylvanians who are getting federal help," he said.
Antoinette Kraus, executive director of the Pennsylvania Health Access Network, expressed a similar reaction in a blog post last week. She warned that "a ruling against the law would shatter the gains we've made in recent years reducing the uninsured rate and connecting hundreds of thousands of hardworking Pennsylvanians with health insurance, protecting both their physical and economic health."
Two Field Clinic contributors saw a ruling against the administration as a chance for Congress to revisit the ACA and possibly make improvements, presumably with some semblance of bipartisanship.
Mark Pauly noted that public attitudes toward the ACA have changed over time, "So, independent of legal technicalities, shouldn't those of us in favor of democracy advocate that it be reconsidered? That is, there should be a political resolution, not a legal one. Congress, and the president, whomever he (or she) is, should make this judgment on our behalf."
The chance for Congressional compromise led Howard Peterson, managing partner of TRG healthcare, to support a ruling for the challengers. It "would drive a new dialogue that would require compromise. I hope the decision is not made only on technical language grounds. That will leave us with just winners and losers. The best counter to 'an exchange established by a state' seems to be 'such as.' The later has been offered as language in the ACA that makes the federal exchange equal to the state."
Finally, Jefferson University population health professor Drew Harris speculated that the political fallout from a ruling for the challengers could backfire on them politically. "The plaintiffs and the Republicans who support them should be careful what they wish for. A victory on this case may do more to popularize the ACA than anything up to this point. As Joni Mitchell said, 'you don't know what you have until it's gone.'"
The story of Obamacare will continue to hold twists and turns. As Justice Elena Kagan said at the hearing, it is "a never-ending saga."
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