Supreme Court affirms Affordable Care Act

The U.S. Supreme Court ruled Thursday that the federal government can continue subsidizing health care insurance under the Affordable Care Act for more than 6 million people in 34 states with a federal marketplace for insurance.

The court by a 6-3 vote rejected a challenge by four Virginia residents who claimed the wording in one section of the 2010 law would allow federal subsidies only for people in the 16 states with state-run insurance marketplaces.

Chief Justice John Roberts wrote in the majority opinion:

“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.”

California is one of the 16 states with a state-run marketplace and thus would not have immediately been affected by a ruling in favor of the challengers.

But it had been expected that a ruling banning the subsidies in the other 34 states would have seriously undermined the operation of the health insurance law nationwide.

Roberts wrote in the majority opinion:

“The combination of no tax credits and an ineffective coverage requirement could well push a state’s individual insurance market into a death spiral. … It is implausible that Congress meant the act to operate in this manner.”

The subsidies are provided through tax credits for people who don’t receive health insurance through their jobs and whose income is between 100 percent and 400 percent of the federal poverty line. The credits are paid in advance to insurers providing the insurance.

The law specified that if the state did not create its own insurance marketplace, known as an exchange, the federal government would provide one.

The disputed wording was in a section that said the tax credits were available to individuals enrolled in an insurance plan through an “exchange established by the state.” The court majority said the phrase was ambiguous and that the content and structure of the law as a whole indicated that the phrase was meant to apply to both federal and state exchanges.

Roberts wrote:

“Those credits are necessary for the federal exchanges to function like their state exchange counterparts, and to avoid the type of calamitous result Congress plainly meant to avoid.”

In a dissent, Justice Antonin Scalia, joined by Justices Clarence Thomas and Samuel Alito, said the majority was rewriting the law through “interpretive jiggery-pokery”:

“It is up to Congress to design its laws with care, and it is up to the people to hold them to account if they fail to carry out that responsibility.”

Debra Ness, president of the nonprofit Partnership for Women & Families, said in a statement, “Our nation will be healthier and families stronger and more economically secure because the U.S. Supreme Court ruled against the challengers in King v. Burwell Thursday:

“In refusing to undermine the law, the court acted wisely and in the country’s best interests.”