The Supreme Court waded back into the Obamacare wars on Friday. And make no mistake: Just because Chief Justice John Roberts voted to uphold the health care law last time around doesn’t mean he has to come out the same way again.
This is a very different case, and Roberts’ vote two years ago doesn’t control his vote here.
In 2012, Roberts famously broke with the court’s other conservatives and provided the fifth vote to uphold the Obama administration’s signature legislation. He agreed with his fellow GOP appointees that Congress lacked authority under the Constitution’s Commerce Clause to make people buy health insurance. But he saved the law on another ground: He wrote that the penalty imposed on those who don’t buy insurance amounts to a tax, and that Congress has the power to enact that tax. The Affordable Care Act lived to see another day.
Now the law’s challengers are back before the Supreme Court, and some have speculated that since Roberts voted to preserve Obamacare once, he’ll do so again. But it’s not that simple: The first case was chock-full of questions about congressional power and the Supreme Court’s proper role. This case, by contrast, is a much more technical, only-a-lawyer-could-love-it fight over the meaning of particular words. Roberts could take the Obama Administration’s side again, to be sure – but his vote also could flip.
Insurance coverage for millions of people turns on which course he and his colleagues choose.
The issue this time is about Obamacare’s subsidies. Those subsidies dramatically reduce the cost of insurance for lower-income Americans who buy health coverage through the Obamacare exchanges. That makes coverage possible for many who otherwise couldn’t afford it.
The Obama administration says Congress intended to make those subsidies available nationwide, and many members of Congress have publicly agreed. But the statute contains a passage that Obamacare opponents have seized on to argue otherwise: It says subsidies are available to people who buy insurance through an exchange “established by the State.” The problem is that some three dozen states never built their own exchanges, so the federal government did it for them.
Obamacare opponents argue that in those states, there is no exchange “established by the State”; instead, there is an exchange established by the federal government. Thus, they say, lower-income residents in those states aren’t eligible for the subsidies that make health care affordable.
The administration counters that federally-built exchanges stand in the shoes of state-established exchanges, so people nationwide are eligible. It also argues that the whole point of the “Affordable” Care Act was to make health coverage affordable for all. The challengers’ interpretation, it says, flies in the face of everything Congress intended.
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This is a huge issue – and not just for those Americans who already use subsidies to pay for their insurance. Without subsidies, many people couldn’t afford to sign up for (or keep) their coverage. And without that influx of customers, the insurance market could face the so-called “death spiral”: Only people who are already sick and expensive to cover would find insurance to be a good deal and sign on, which would raise insurers’ average costs, which would lead to a big hike in premiums, which would push more healthy customers out of the market, and so on. Some analysts believe the Affordable Care Act won’t be viable at all without subsidies.
So it comes down to this: The availability of the subsidies at the heart of Obamacare, and possibly the survival of Obamacare itself, turn on four words in a statute a thousand pages long. %22This%20is%20a%20huge%20issue%20%E2%80%94%20and%20not%20just%20for%20those%20Americans%20who%20already%20use%20subsidies%20to%20pay%20for%20their%20insurance.%22′ The court will issue its decision by June. And while predicting anyone’s vote is an inexact science, one data point is telling: Six appellate judges on two lower courts have ruled on this issue, and each one has voted along party lines. The two GOP appointees have sided with the challengers and concluded that subsidies aren’t available in a huge swath of the country. The four Democratic appointees, by contrast, have concluded that subsidies are available nationwide. If that pattern holds in the Supreme Court – a court with five Republican and four Democratic appointees – the case will be close. And so it comes back to Roberts. The challengers will appeal to his conservative instincts, arguing that Congress must be held to the words it chose and that courts can’t be in the business of rewriting statutes. Will he agree? Not necessarily. The government has a convincing textual argument of its own, and arguably a much stronger case about what Congress intended. The one thing that’s certain: Obamacare Wars Vol. 2 is a completely different case than the first iteration. The chief justice will have to make up his mind anew. The Affordable Care Act’s future may hang on how he comes out. Dominic Perella is a partner at Hogan Lovells US LLP in Washington, D.C. He has authored friend-of-the-court briefs in the subsidies case, arguing in favor of the government’s position. His views in this column are his own and not those of his clients.
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