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Supreme Court rules subsidies apply to federal healthcare exchange
Supreme Court rules subsidies apply to federal healthcare exchange

The US Supreme Court [official website] on Thursday ruled [opinion, PDF] 6-3 in King v. Burwell [SCOTUSblog materials] that tax credits available to those who buy health insurance through state exchanges are also available to those who buy it through the federal exchange. At issue was language [26 USC § 36B ] in the Affordable Care Act (ACA) [materials], which made tax credits available to those who buy insurance through “an Exchange established by the State” under 42 USC §18031 [text], but didn’t explicitly include cases where states opted to use the federal exchange. Petitioners in the case argued that a plain-meaning interpretation of the language would not support the application to the federal exchange, and that Congress would have explicitly included the federal exchange had it meant to. But writing for the court, Chief Justice John Roberts disagreed, saying that providing tax credits in one case but not the other made the two types of exchanges substantially different, which was both at odds with how they were referenced in other parts of the bill and would seem to undermine its primary intent:

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. Section 36B can fairly be read consistent with what we see as Congress’s plan, and that is the reading we adopt.

The decision upheld an earlier ruling [opinion] by the US Court of Appeals for the Fourth Circuit [official website].

Justice Antonin Scalia wrote a dissent, joined by Justices Clarence Thomas and Samuel Alito. In it, Scalia said the majority had gone out of its way with “interpretive jiggery-pokery” to equate the state and federal exchanges, and argued that the language in question was clear and not subject such a degree of interpretation. The court granted certiorari to the case in November and heard oral arguments [JURIST reports] in March. The ACA [JURIST backgrounder] has been one of US President Barack Obama’s biggest and most controversial pieces of legislation.