Benjamin Wills of Atlanta is among the more than 400,000 Georgians receiving a subsidy to afford health insurance in the Affordable Care Act exchange.
With the subsidy, Wills is paying a monthly premium of $370 for family medical and dental coverage through the exchange.
If he loses the subsidy, Wills said Wednesday, he could be forced to drop his family’s dental coverage, and perhaps re-enroll his daughter in the government PeachCare program.
“The way [the ACA] is now is working for our family,’’ said Wills, who recently left a job with benefits to start a private Christian school in Atlanta.
The fate of the insurance subsidies – and the future of the Affordable Care Act in general – were on the line as the U.S. Supreme Court heard arguments Wednesday on the legality of the credits in the exchanges in Georgia and 36 other states.
This case, King v. Burwell, is not officially a challenge to the ACA. Instead, the plaintiffs in the case say the law is not being followed. They argue that the subsidies, which help people afford coverage, are not permitted by the health law in the 37 states that have federally operated insurance exchanges.
After more than an hour of arguments in the case Wednesday, the justices appeared divided over the subsidies issue.
Chief Justice John Roberts — who surprised many in 2012 when he sided with the court’s four liberals and upheld the ACA’s constitutionality — said next to nothing, in a clear strategy not to tip his hat either way, the Associated Press reported.
“Roberts, who’s usually a very active participant in oral arguments, said almost nothing for an hour and a half,” CNN’s Supreme Court analyst Jeffrey Toobin said after attending the hearing. “[Roberts] was so much a focus of attention because of his vote in the first Obamacare case in 2012 that he somehow didn’t want to give people a preview of how he was thinking in this case. . . . He said barely a word.”
The plaintiffs point to the ACA’s language, which says the subsidies are available for qualified individuals who purchase insurance through a marketplace — called an exchange — that was “established by the State.” They say the federal government has violated the clear language of the law by approving subsidies in federally run exchanges.
Health care experts have estimated that as many as 7.5 million people could lose the subsidies if the challengers prevail. It would hit disproportionately in the South, the New York Times reported.
Reading the court’s signals
There appeared to be no doubt that the court’s liberals would side with the administration, the Washington Post reported. All four aggressively questioned Michael Carvin, the lawyer challenging the Obama administration’s interpretation of the law.
Justice Elena Kagan suggested the law should be interpreted in its “whole context” and not in the one phrase that is the focus of the challengers. Justice Sonia Sotomayor was concerned that the challengers’ interpretation of the law could lead to insurance “death spirals” in states that hadn’t established their own exchanges.
A death spiral occurs when healthy people drop out of an insurance pool, leaving sicker people to pay increasingly expensive prices for care.
During the time allotted to Solicitor General Donald Verrilli, representing the government, he got tough questions from conservative Justices Antonin Scalia and Samuel Alito, the Washington Post reported.
When Verrilli said Carvin’s interpretation of the ACA “cannot be the statute Congress intended,” Scalia replied, “The question is whether it’s the statute Congress wrote.”
Scalia said it is not up to the court to “twist the words as necessary” to make them fit the government’s view.
If there was a reason for optimism for the Obama administration, it came from Justice Anthony Kennedy, a moderate who’s considered a potential swing vote, the Post reported. He questioned whether the challengers’ reading of the law — that federal tax subsidies should be available only in the 16 states and District of Columbia that have set up their own insurance marketplaces — would cause “serious constitutional problems” of coercion.
An uncertain future
Last week, U.S. Health and Human Services Secretary Sylvia Mathews Burwell warned that if the government loses in court, it has prepared no backup plan to “undo the massive damage.”
Drew Altman of the Kaiser Family Foundation noted that experts predict a ruling against subsidies in federally run exchanges would take effect quickly, with people losing financial assistance within 25 days.
“A grace period lasting through 2016 would give interested states time to set up marketplaces and start enrolling people for 2017,” Altman said in a Wall Street Journal column. “But would Republicans want to give states – and people receiving financial assistance for health coverage – the time?”
Georgia and several other states have erected an additional hurdle. Last year, the Georgia Legislature passed a law prohibiting the state from running its own exchange.
Predicting what the Supreme Court will do — based on questions to lawyers or past decisions — is always tricky. In 2012, pundits thought Kennedy might vote to uphold the ACA, while Roberts seemed a solid vote against it. The opposite proved true. And the court, even while finding the law constitutional, drastically weakened its Medicaid expansion provision, which surprised almost everyone.
A ruling on King v. Burwell is expected in June.