King v. Burwell: U.S. Supreme Court Decision on June 25, 2015

On June 25, 2015, the United States Supreme Court delivered a landmark decision in the case of King v. Burwell, which had significant implications for the Affordable Care Act (ACA), commonly known as “Obamacare.” The ruling upheld a crucial component of the ACA, ensuring the continuation of federal subsidies for health insurance.

Background

The Affordable Care Act, enacted in 2010, aimed to increase the quality and affordability of health insurance, reduce the uninsured rate, and lower healthcare costs. A key feature of the ACA was the establishment of health insurance exchanges, marketplaces where individuals could purchase insurance plans. The law allowed for the creation of both state-run and federally-facilitated exchanges.

The controversy in King v. Burwell centered around the interpretation of a specific provision in the ACA. The plaintiffs argued that the language of the law only permitted subsidies for insurance purchased through exchanges “established by the State.” They contended that individuals in states that opted not to set up their own exchanges, and instead used the federal exchange (HealthCare.gov), were not eligible for these subsidies.

The Supreme Court’s Decision

In a 6-3 decision, the Supreme Court ruled in favor of upholding the provision of federal subsidies to individuals in all states, regardless of whether the exchange was state-run or federally-facilitated. Chief Justice John Roberts authored the majority opinion, emphasizing the intent of the ACA to improve health insurance markets, not to destroy them. The Court’s interpretation focused on the broader purpose of the law, which was to make healthcare more accessible and affordable.

Key Points of the Ruling

• Statutory Interpretation: The Court concluded that the phrase “established by the State” should be interpreted in the context of the ACA’s overall structure and purpose. The ruling emphasized that Congress intended for the subsidies to be available to all eligible Americans, irrespective of the type of exchange.

• Impact on the ACA: By upholding the subsidies, the decision preserved the financial assistance that millions of Americans relied upon to afford health insurance. This was crucial for maintaining the stability of insurance markets and preventing a potential “death spiral” where only the sickest individuals would purchase insurance, driving up costs.

Aftermath and Significance

The King v. Burwell decision was a pivotal moment in the ongoing legal and political battles over the ACA. It reinforced the law’s framework and ensured that the federal government could continue to provide subsidies, which were essential for the ACA’s goal of expanding healthcare coverage.

The ruling also underscored the Supreme Court’s role in interpreting complex legislation and highlighted the importance of judicial interpretation in understanding congressional intent. By affirming the subsidies, the Court helped solidify the ACA’s place in the American healthcare system, impacting millions of lives and shaping the future of healthcare policy in the United States.