The Supreme Court today agreed to hear the King v. Burwell case, which – similar to Halbig v. Burwell, wherein the DC Circuit Court ruled against Burwell (i.e., the Affordable Care Act) in July – challenges the legality of tax subsidies used to offset the cost to individuals buying health insurance through federally administered exchanges. As the ACA was written subsidies were to be available through state run exchanges, but since most states opted out of creating and running their own exchanges more than two-thirds of everyone who signed up for health insurance did so through federal exchanges. Of those, approximately 85% – or 5 million people – received subsidies at an average value of approximately $3,200 per year.

Those folks stand to lose that benefit – and in many cases likely health insurance –if SCOTUS determines that the letter of the law should supersede legislative intent. Beyond that, given the actuarial models supporting expansion of individual health insurance under the ACA the prospective financial viability of that expansion would likely becomes untenable.

Congressional staffers had already been discussing ideas of how to work around the loss of tax subsidies – but that was before this Tuesday. The new sheriff in town won’t be very anxious to support legislative efforts that seek to save Obamacare in any fashion. What can be done through regulations? My guess is not much, so a ruling in favor of King would likely be the devastating blow detractors have been chasing since March of 2010.

From a retrospective standpoint this is just another serious distraction in a long line of legal and administrative obstacles that have become part and parcel of legislative implementation. It reflects the urgent and manipulative manner in which the Affordable Care Act was rammed through passage in March 2010 following a string of made-for-TV political events that played out beginning with the death of Senator Ted Kennedy in August 2009.

Ever since then Republicans have argued that a policy initiative of the breadth and scope of the Affordable Care Act necessarily should have been subject to broader bipartisan support, such as what would have been required through a normal reconciliation process of the two House and Senate bills. While at the same time Democrats have argued Republicans’ expressed concern has largely been a case of “protesting too much” and only really being concerned with stopping any legislative initiative of the President, regardless of its policy merits.

In any event, what SCOTUS will have to wrestle with is attempting to understand the contextual purpose of the health insurance subsidies and whether legislative intent is a sufficient enough consideration to disregard the stated restriction of those subsidies to only state run exchanges. As someone who has supported the ACA I don’t share this from the perspective of looking for any opportunity to blow it up. But I think it has to be taken into consideration by the Court that the law’s contorted framework and structure is a theoretical obstacle for accepting the legislative intent argument.

How can you accept legislative intent as a theoretically understood precept for a provision of an act that in several significant instances (i.e., CLASS, the employer mandate, renewal of noncompliant plans, special enrollment and hardship exemptions), has not been implemented as intended? Are the justices required to not consider legislative enactment and just look at the Act independently of the apparent disconnect? I’m not a lawyer, so maybe I am just thinking of this like a four year old – but then someone is going to have to explain to me what’s wrong with my logic.

Cheers and enjoy the weekend,
  ~ Sparky