U.S. Supreme Court upholds Obamacare subsidies, Scalia rebukes court decision

In a 6-3 ruling Thursday, the United States Supreme Court upheld the use of healthcare subsidies in connection with the Affordable Care Act.

The case, King v. Burwell, faced a question over the phrase, “Established by the State” and whether Congress intended the portion of the landmark health care measure to apply to federal and state health exchanges or just federal-run exchanges.

Voting in favor of King v. Burwell were Chief Justice John Roberts and Justices Anthony Kennedy, Ruth Bader Ginsburg, Stephen Breyer, Sonia Sotomayor and Elena Kagan. Voting against were Justices Antonin Scalia, Clarence Thomas and Samuel Alito.

The ruling means that nearly three dozen states, including Arkansas, will not have to change their current health exchange systems created under ACA immediately, although Arkansas lawmakers are studying major changes through a Health Reform Task Force.

In the 47-page opinion released Thursday morning, Chief Justice John Roberts, who wrote for the majority, argued that the use of the phrase “Established by the State” should be looked at in a more complete manner. Meanwhile, Justice Antonin Scalia, who wrote the dissent, said the reasoning behind the ruling was “absurd” and said the law should be called “ScotusCare.”

ROBERTS OPINION
In his opinion, Roberts said justices needed to look at the wording of a law in full before making a decision.

“It is instead our task to determine the correct reading of Section 36B. If the statutory language is plain, we must enforce it according to its terms… But oftentimes the ‘meaning—or ambiguity—of certain words or phrases may only become evident when placed in context,’” Roberts said. “So when deciding whether the language is plain, we must read the words ‘in their context and with a view to their place in the overall statutory scheme.’ … Our duty, after all, is ‘to construe statutes, not isolated provisions.’”

As for the law, Roberts said it provides a clear rule for federal agencies to follow.

“As we just mentioned, the Act requires all Exchanges to ‘make available qualified health plans to qualified individuals’ — something an Exchange could not do if there were no such individuals. And the Act tells the Exchange, in deciding which health plans to offer, to consider ‘the interests of qualified individuals . . . in the State or States in which such Exchange operates’ — again, something the Exchange could not do if qualified individuals did not exist,” Roberts said. “This problem arises repeatedly throughout the Act. See, e.g., §18031(b)(2)(allowing a State to create ‘one Exchange . . . for providing . . . services to both qualified individuals and qualified small employers,’ rather than creating separate Exchanges for those two groups). These provisions suggest that the Act may not always use the phrase ‘established by the State’ in its most natural sense. Thus, the meaning of that phrase may not be as clear as it appears when read out of context.”

“Third, we must determine whether a Federal Exchange is established ‘under [42 U. S. C. §18031].’ This too might seem a requirement that a Federal Exchange cannot fulfill, because it is Section 18041 that tells the Secretary when to ‘establish and operate such Exchange.’ But here again, the way different provisions in the statute interact suggests otherwise,” the chief justice wrote.

Roberts also said the decision on the law was directly in the hands of Congress.

“In a democracy, the power to make the law rests with those chosen by the people. Our role is more confined — ‘to say what the law is.’ Marbury v. Madison, 1 Cranch 137, 177 (1803). That is easier in some cases than in others. But in every case we must respect the role of the Legislature, and take care not to undo what it has done. A fair reading of legislation demands a fair understanding of the legislative plan. Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the Act in a way that is consistent with the former, and avoids the latter. Section 36B can fairly be read consistent with what we see as Congress’s plan, and that is the reading we adopt. The judgment of the United States Court of Appeals for the Fourth Circuit is affirmed,” Roberts wrote.

SCALIA DISSENT
In his dissent, Scalia said he believes justices were attempting to save the law in spite of a clear reason not to.

“The Court holds that when the Patient Protection and Affordable Care Act says ‘Exchange established by the State’ it means ‘Exchange established by the State or the Federal Government.’ That is of course quite absurd, and the Court’s 21 pages of explanation make it no less so,” Scalia wrote. “Words no longer have meaning if an Exchange that is not established by a State is ‘established by the State.’ It is hard to come up with a clearer way to limit tax credits to state Exchanges than to use the words ‘established by the State.’ And it is hard to come up with a reason to include the words ‘by the State’ other than the purpose of limiting credits to state Exchanges,” Scalia said.

“[T]he plain, obvious, and rational meaning of a statute is always to be preferred to any curious, narrow, hidden sense that nothing but the exigency of a hard case and the ingenuity and study of an acute and powerful intellect would discover,” he said. “Under all the usual rules of interpretation, in short, the Government should lose this case. But normal rules of interpretation seem always to yield to the overriding principle of the present Court: The Affordable Care Act must be saved.”

Scalia wrote that the majority opinion used seven different criteria to uphold the law.

“It is bad enough for a court to cross out ‘by the State’ once. But seven times,” Scalia wrote. “Congress did not, by the way, repeat ‘Exchange established by the State under [§18031]’ by rote throughout the Act. Quite the contrary, clause after clause of the law uses a more general term such as ‘Exchange’ or ‘Exchange established under [§18031].’ See, e.g., 42 U. S. C. §§18031(k), 18033; 26 U. S. C. §6055. It is common sense that any speaker who says ‘Exchange’ some of the time, but ‘Exchange established by the State’ the rest of the time, probably means something by the contrast.”

Scalia also included a stinging rebuke for the court.

“This Court, however, saw that the Spending Clause does not authorize this coercive condition. So it rewrote the law to withhold only the incremental funds associated with the Medicaid expansion… Having transformed two major parts of the law, the Court today has turned its attention to a third. The Act that Congress passed makes tax credits available only on an ‘Exchange established by the State.’ This Court, however, concludes that this limitation would prevent the rest of the Act from working as well as hoped. So it rewrites the law to make tax credits available everywhere. We should start calling this law SCOTUScare,” he said.

“Perhaps the Patient Protection and Affordable Care Act will attain the enduring status of the Social Security Act or the Taft-Hartley Act; perhaps not. But this Court’s two decisions on the Act will surely be remembered through the years. The somersaults of statutory interpretation they have performed (‘penalty’ means tax, ‘further [Medicaid] payments to the State’ means only incremental Medicaid payments to the State, ‘established by the State’ means not established by the State) will be cited by litigants endlessly, to the confusion of honest jurisprudence. And the cases will publish forever the discouraging truth that the Supreme Court of the United States favors some laws over others, and is prepared to do whatever it takes to uphold and assist its favorites. I dissent.”