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Supreme Court upholds nationwide health care law subsidies, gives Obamacare big win

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WASHINGTON -- Obamacare has survived -- again.

In a major win for the Obama administration, the Supreme Court held in a 6-3 decision that the Affordable Care Act authorized federal tax credits for eligible Americans living not only in states with their own exchanges but also in the 34 states with federal exchanges.

Chief Justice John Roberts wrote for himself, Justice Anthony Kennedy and the four liberal justices. Justice Antonin Scalia wrote the dissent, joined by Clarence Thomas and Samuel Alito.

The ruling staved off a major political showdown and what would have been a mad scramble in some states to set up their own healthcare exchanges to keep millions from losing healthcare coverage.

Challengers to the law argued that the federal government should not be allowed to continue doling out subsidies to individuals living in states without their own healthcare exchanges and a ruling in their favor would have cut off subsidies to 6.4 million Americans, absent a congressional fix or state action.

The ruling is a huge victory for President Barack Obama who nearly saw those four words in the Affordable Care Act throw his signature achievement into chaos.

The income-based subsidies are crucial to the law's success, helping to make health insurance more affordable and ultimately reducing the number of uninsured Americans, and shutting off the subsidy spigot to individuals in the 34 states that rely on exchanges run by the federal government would have upended the law.

Congress would have had to amend the Affordable Care Act to fix the "established by the state" language -- a politically treacherous and likely untenable action in a Republican Congress -- or governors in the 34 states without their own exchanges, most of them Republicans, would have had to establish their own exchanges -- another tough ask.

Obama's signature law was once again saved by an unlikely hero: Chief Justice John Roberts, a conservative who has now twice shielded the law from being gutted.

Roberts took heat from conservatives in 2012 when he first saved the law from a major constitutional challenge in a decision that stunned pundits and politicos across the ideological spectrum. The Chief Justice on Monday once again joined the court's four liberal justices in upholding the law.

Just 16 states and the District of Columbia have set up their own health insurance marketplaces, which left millions of residents in the 34 states that rely on exchanges run by the federal government vulnerable to the Supreme Court's ruling.

Challengers had argued that the words "established by the State" clearly barred the government from doling out subsidies in the 34 states without their own healthcare marketplaces.

They said that Congress limited the subsidies in order to encourage the states to set up their own exchanges and when that failed on a large scale, the IRS tried to "fix" the law.

"If the rule of law means anything, it is that text is not infinitely malleable, and that agencies must follow the law as written---not revise it to 'better achieve' what they assume to have been Congress's purposes," wrote Michael Carvin, an attorney for the challengers.

But it was Solicitor Generald Donald B. Verrilli, Jr. who won over the justices, arguing that Congress always intended the subsidies be available to everyone -- regardless of the actions of their state leaders.

Verrilli warned in court briefs that if the challengers prevailed, the states with federally-run exchanges "would face the very death spirals the Act was structured to avoid and insurance coverage for millions of their residents would be extinguished."

Lower courts had split on the issue. The U.S. Court of Appeals for the District of Columbia invalidated the IRS rule while the Fourth Circuit Court of Appeals ruled in favor of the Obama administration.

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31 comments

    • tootietuttle

      it’s a great day for America’s lenders as they know that this president will sink us so deep into a hole, we will never climb out. Not so great day for the children of America who get to inherit the debts and problems of today….hooray…

        • tootietuttle

          which war? Is it the one that Hillary and other dems supported after terrorists flew into the World trade center, or the war in afghanistan, (the one Obama left to appease you liberals and allowed to build up a bigger terrorist network that poses a larger threat than anything GW could have possibly imagined?) or is it the war against the middle class that Obama has started here?? Better yet, now that Obama has spent all the money to buy us out of the recession and auctioned off our children’s future to the highest bidder because you dems just can’t control your spending, we just ignore our own safety. At least we have dollar figures on the Iraq war, but do tell actual dollar figures that aren’t Peety-made statistics for this Obamacare disaster???

  • emily chnag

    Awful…

    Middle income people are getting killed by ObamaCare. If you earn over the guidelines for the subsidy you will find yourself paying outrageous premiums. I purchase my insurance on the individual market…have for years. After ACA, my plan was cancelled and had to be replaced by an ACA compliant plan chock full of things I don’t need like pediatric dental care, maternity care, etc.

    A single person earning over $46k does not qualify for a subsidy. Since when did $46K become “wealthy”? Without the subsidy my premium for a crappy silver plan more than doubled and my deductible went from $1500 to $6500. To get a lower deductible gold level plan my premium would triple. My car insurance ($25/month from Insurance Panda), renters insurance ($10/month from Eagle), even iPhone insurance premiums rarely increase and are still cheap. How come after the ACA, my health premiums have nearly tripled?!

    When I complained to my Democrat congressman he said well the ACA helps a lot of low income people. So I guess it’s OK then to hurt middle income people, Vote all Democrats who inflicted this on us, out!

    • "peety"

      dental coverage is not part of ACA. Premiums rose 4% last year on average and 3% the year before.

      Methinks you are a paid Heritage foundation troll or just sour grapes exaggerating for effect.

      • Wanda Stewart

        Wrong, dental coverage for children even if you have no children is being added to all insurance policies even the ones not bought on the exchange!!

        Methinks you are a paid troll of the DNC!!

        • "peety"

          Child Dental Coverage

          All plans offered to children must include dental coverage as an essential benefit. This means if you’re getting coverage for someone 18 or younger, dental coverage must be available as part of a health plan or as a stand-alone plan. While it must be available to you, you don’t have to buy it.

          Rejecting child dental coverage won’t result in your child not having minimum essential coverage, and you won’t pay the fee.

        • dg54321

          Well, a troll at any rate. Paid or otherwise. He does follow the script for the paid agitator to the letter, though.

    • hellomurica

      But… but “you can keep your doctor”! Right? Oblunder is a joke, a liar, a hypocrite; nothing but a typical politician.

    • tootietuttle

      it is very true that this is killing the 46K – 100K with actual families for the sake of the Less than 46K who have a far less chance of contributing to the program in the future. We sacrifice the middle class so the poor can remain poor.

    • Max Von Toadenoff

      Dear Emily, Don’t you actually mean that you didn’t keep your old plan because your greedy insurance company refused to supply you with the same plan you were on? That’s not the fault of the ACA, that’s the greed of your insurance company that took advantage of you and those like you.

  • Kit

    The Republicans claim to be working for the middle class, but I doubt that. The GOP would like America to be more like China; low wages, no unions, no healthcare and industrial pollution with cancer for breakfast.

  • Cheryl

    I am with you on this Emily. Rate I was quoted was without eye or dental, that was to be more according to Obamacare rep. Even without that was still not affordable for me at all especially with the deductible. I know many who are able to buy and do things I cannot and they have Apple Health. So no I am not a big fan of Obamacare. We need a national health insurance for everyone that works better than this does. A lot of people are not being helped who pay into a system that sucks. Even my dentist did not join.

  • Q13 Political Agenda News

    “Congress would have had to amend the Affordable Care Act to fix the “established by the state” language — in a Republican Congress — or governors in the 34 states without their own exchanges, most of them Republicans, would have had to establish their own exchanges — another tough ask.”

    Is it just me or is this News station throwing straight forward informative stories out the window and reporting stories in a manner that fits someones political agenda? I may be younger than a lot of folks, but I have sat through enough Political issues to know that it doesn’t matter whether the Congress/ state governors are run by Dems or Reps. All issues become “a politically treacherous and likely untenable action” with Congress. Quit turning this into a Republicans are Bad and Democrats are Awesome story. Politicians suck at getting issues resolved regardless of which party they fall under. Most voters know it isn’t the “party affiliation” that should win your vote, it is actually paying ATTENTION to politics and getting to know what their actual viewpoints are. Besides if you gave ANY politician a 100 question session, not ONE would fall FIRMLY in the left or the Right. It is a spectrum and most will fall closer to the middle than to either one side.