King v. Burwell to be decided soon

by | Jun 4, 2015 | Affordable Care Act | 0 comments

Supreme Court of The United States (SCOTUS) will control the fate of the Affordable Care Act (ACA)

Whether you agree or disagree with the principles of the ACA, it is evident that a significant amount of human and financial capital has been spent on addressing the flaws in the bill. The section of the ACA being litigated in King v. Burwell was first called into question in 2010. Congress and the Obama administration have yet to make any progress since then in addressing these issues. However, the Secretary of Health and Human Services and the Internal Revenue Service have made administrative decisions that have now forced the SCOTUS to hear the case. They will render their decision this month.

How the court is expected to rule:

I believe that Justices Kagan, Ginsburg, Sotomayor, and Breyer will side with the government and uphold a tax subsidy for individuals who have any exchange-based health coverage. I expect that Justices Alito and Thomas will side with King and strike down these tax subsidies. Therefore, the decision will come down to Justices Kennedy, Scalia and Roberts. I will speculate on each Justice’s ruling below:

Justice Kennedy

In the case of King v. Burwell, Justice Kennedy previously questioned attorneys regarding whether the federal government had coerced the states into participating in health care exchanges. This same argument was used to strike down the Medicaid expansion in 2012. The difference in this case is that the federal government would not be withholding funds from the states, but rather from individuals. Therefore, it is unlikely Justice Kennedy would use this rationale in making his decision regarding King v. Burwell. Most experts believe that Justice Kennedy could rule either way.

Justice Scalia

Contemporary societal values and congressional intent will likely influence Justice Scalia’s decision. Therefore, he may determine that the tax subsidies are constitutional as written since they are vital to the success of the ACA. Although Congress may not have intended to coerce the states, it has been reported that one of the architects (i.e., a consultant) of the ACA said on several occasions that the verbiage was specifically written to coerce states to set up their own exchanges to enable individuals to receive tax subsidies. However, in order to rule that the tax subsidies are unconstitutional, Justice Scalia would have to believe that it was actually Congress’ intent to coerce the states, not just the architects of the bill. Most likely, Justice Scalia’s opinion will be determined based on the actual language used in the ACA.

Chief Justice Roberts

Chief Justice Roberts ruled that the “individual mandate” case in 2012 could be heard by SCOTUS because the repercussions for individuals without health coverage were referred to as a “penalty” paid to the IRS as opposed to a “tax.” However, in this same 2012 ACA case, Chief Justice Roberts wrote for the majority opinion that the individual mandate was actually a tax, and Congress has the sole right to tax. Therefore, the individual mandate was upheld as constitutional. Based on this previous ruling in 2012, there is no sure way to determine which way he will decide in the case of King v. Burwell.

In the next few days or weeks we will find out how this Supreme Court will rule.

It will certainly be interesting to see how Justices Kennedy, Scalia and Roberts rule.

Tom Raffio
June 2015

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