Is ObamaCare heading back to the Supreme Court?
A Supreme Court ruling striking down the IRS subsidies in all 50 states would provide an important opportunity for reform.
The U.S. Supreme Court may soon consider hearing a legal challenge to ObamaCare in a case that could significantly undo the law in 34 states. At issue is what the plain text of Section 1401 of the Affordable Care Act means.
Even though the text of the law states that the subsidies are available only “through an Exchange established by the State under 1311 of the Patient Protection and Affordable Care Act,” the IRS, without congressional authorization, allowed federal subsidies to flow into states participating in the federal exchange when it implemented the law.
When the Supreme Court conference convenes on Friday, court-watchers will be waiting to see if the court agrees to review the decision in King v. Burwell. The plaintiffs in this case challenged the IRS’s rule that made insurance subsidies available in all states, contrary to the text of the Affordable Care Act. The Fourth U.S. Circuit Court of Appeals upheld the legality of the IRS subsidies in July.
At present there are four legal challenges that are based on this issue. In one case, State of Indiana v. IRS, oral arguments were heard in federal district court earlier this month.
The Halbig v. Burwell challenge is currently being reheard by the full D.C. Circuit Court with oral arguments scheduled for December. The court originally upheld the legality of the IRS subsidies, but the Appeals Court for the D.C. Circuit ruled that the IRS subsidies were not legal in states that did not establish their own exchanges. The Obama administration petitioned the circuit court for an en banc review, and were granted one, meaning the case will be reheard and new ruling will be issued.
But a recent ruling on Oklahoma Attorney General Scott Pruitt’s legal challenge to the law, Pruitt v. Burwell, just increased the likelihood that the case might be heard by the Supreme Court. On Sept. 30, an Oklahoma federal district court ruled that the law should be applied as written. This case will eventually be heard by the 7th U.S. Circuit Court of Appeals.
A Supreme Court ruling striking down the IRS subsidies in all 50 states would provide an important opportunity for reform. Congressional lawmakers, as well as state lawmakers in the 36 states that did not establish a state-based ObamaCare exchange, would have the opportunity to pass meaningful health-care reform in a way that respects taxpayers, provides for the truly needy and addresses health-care costs – delivering on the original ObamaCare promises.