June 25, 2015 — The Supreme Court on Thursday voted 6-3 to uphold the Affordable Care Act's (PL 111-148) tax credits to help U.S. residents purchase coverage through the federal health insurance marketplace, the Wall Street Journal reports.
According to the Journal, the ruling leaves the law "on a firmer footing" for President Obama's remaining time in office (Kendall/Radnofsky, Wall Street Journal, 6/25).
At issue in the case was a sentence in the statute that says the tax credits are available to help certain U.S. residents purchase coverage offered through a marketplace, also known as an exchange, that is "established by the State." The plaintiffs argued that the clause should have been interpreted literally, meaning that the tax credits would not have been available to individuals purchasing coverage through the federal marketplace and could have been used only in states that have established their own exchanges (Women's Health Policy Report, 3/5).
In July 2014, the 4th U.S. Circuit Court of Appeals ruled in support of the ACA's tax credits. The court held that that "the applicable statutory language is ambiguous and subject to multiple interpretations" and therefore the government and its regulators had legal precedent to determine how to implement the law.
The plaintiffs then appealed to the Supreme Court (Koff, Northeast Ohio Media Group/Cleveland Plain Dealer, 6/25).The high court heard oral arguments in the case in March (Women's Health Policy Report, 3/5).
The high court's opinion -- delivered by Chief Justice John Roberts and joined by Justices Stephen Breyer, Ruth Bader Ginsburg, Elena Kagan, Anthony Kennedy and Sonia Sotomayor -- affirmed the tax credits. The justices wrote, "Congress passed the [ACA] to improve health insurance markets, not to destroy them" (Wall Street Journal, 6/25). They added, "If at all possible, we must interpret the act in a way that is consistent with the former, and avoids the latter" (Liptak, New York Times, 6/25).
The opinion stated that striking down the subsidies "would destabilize the individual insurance market in any State with a Federal Exchange, and likely create the very 'death spirals' that Congress designed the [ACA] to avoid."
The justices added, "The combination of no tax credits and an ineffective coverage requirement could well push a State's individual insurance market into a death spiral ... It is implausible that Congress meant the [ACA] to operate in this manner. Congress made the guaranteed issue and community rating requirements applicable in every State in the Nation. But those requirements only work when combined with the coverage requirement and tax credits. So it stands to reason that Congress meant for those provisions to apply in every State as well" (Stern, "The Slatest," Slate, 6/25).
Meanwhile, Justice Antonin Scalia filed the dissenting opinion which was joined by Justices Samuel Alito and Clarence Thomas (New York Times, 6/25).
Women's Health Supporters Applaud Decision
Debra Ness, president of the National Partnership for Women & Families, praised the ruling. "Our nation will be healthier and families stronger and more economically secure because the U.S. Supreme Court ruled against the challengers in King v. Burwell today," she said, noting that the "case posed a direct threat to the health insurance subsidies that make coverage affordable for the roughly 6.4 million people in 34 states who enrolled in coverage through the federal marketplace."
Ness added, "Women, in particular, can breathe a sigh of relief today. Women are 54 percent of those purchasing coverage through the federal marketplace and would have been hurt the most by an adverse ruling." She said the law "has been the greatest advance for women's health in a generation," with provisions covering "preventive care, including contraceptive services, with no additional out-of-pocket costs" and barring insurers from charging "women more than men for the same health insurance policies," among other benefits (NPWF press release, 6/25).
Similarly, Clare Coleman, president and CEO at the National Family Planning & Reproductive Health Association, said, "Today's ruling by the high court in King v. Burwell is a major victory in the efforts to improve the quality, affordability, and accessibility of preventive health services, including contraception, in the country" (NFPRHA press release, 6/25).
Sasha Bruce, vice president of campaigns and strategy at NARAL Pro-Choice America, also applauded the ruling. "The Supreme Court's decision validates what we've always known to be true, the [ACA] is both constitutional and it is working for Americans who need it most," she said, adding, "Without the [ACA], women would be charged more for health insurance and expected to pay out of pocket for the ability to decide, when, if, and how to have a child" (NARAL Pro-Choice America press release, 6/25).