Briefs: King v. Burwell ruling against subsidies would be 'devastating'

Four amicus briefs highlight importance of federal subisides, consequences should they disappear

Wording is everything. One word can change the meaning of a sentence or story entirely.

The Affordable Care Act includes the phrase, "through an exchange established by the State," regarding the circumstances in which consumers can acquire insurance with a federal subsidy.

In the upcoming King v. Burwell case, which the Supreme Court will hear March 4, the plaintiffs in the case focus on one word: Established. Specifically, they question whether Congress intended to allow consumers shopping on the federal exchange to use subsidies in addition to state-run marketplaces.

To avoid confusion--and the upcoming court ruling--could this phrase have been worded better?

"We didn't think there was a problem," Rep. Sandy Levin (D-Mich.) told The Hill. No one ever suggested there was a problem. The assumption was that these tax provisions would apply across the board. There's no problem."

The Supreme Court will take the entire law into account when it makes its decision. When the high court announced that it would hear the case, it adopted something known as 'the whole text canon of statutory interpretation,' Neal Katyal, former acting U.S. solicitor general, mentioned on a call with reporters Wednesday.

"If you look at that particular section, they are, indeed, federally created exchanges, but they operate within their own individual state," Neera Tandeen, president of the Center for American Progress, told reporters. "We should look at the context of the law. The bill flows very well together."

The call, hosted by SKDKnickerbocker, a political consulting firm in the District of Columbia, highlighted four amicus briefs filed Wednesday. Each speaker on the call represented one of the four briefs.

"The law is doing exactly what it intended to do: Make insurance affordable for everyone, in all states--meaning, whether states have their own marketplaces or whether they use the federal exchange. When Congress voted on the healthcare reform law, members assumed that subsidies would be available in all states," said Elizabeth Wydra, chief counsel at the Constitutional Accountability Center.

The four speakers echoed the same thing: The healthcare reform law is working. The uninsured rate dropped to 12.9 percent in the fourth quarter of 2014. All agreed that, should the Supreme Court side with the plaintiffs, the result would be "devastating."

"It would damage the entire healthcare system, since the markets are integrated. Premiums will rise dramatically everywhere, and ultimately, affect everyone," said Danielle Gray, former assistant to the president and cabinet secretary. Another example of just how the law is working: Premiums aren't skyrocketing the way critics and industry experts had previously predicted.

The industry as a whole has been warned of this potential "death spiral" should the Supreme Court rule in favor of the plaintiffs. Insurers would lose their healthy members and thus be forced to raise prices. Ultimately, insurers would lose a ton of customers, reported Talking Points Memo.  

What's more, should the Supreme Court rule subsidies to be illegal, insurers would lose out on an expected $32 billion in payments, reported the National Journal

Republicans, meanwhile, see the case as a chance to dismantle the ACA, backing the idea that a Democrat-controlled Congress used the subsidies to goad states into creating their own exchanges, according to the Washington Times

Were that the case, the American Cancer Society--who also filed its own amicus brief--told the Washington Times, "we would have objected even more strongly to any legislative provision that used patients' well-being as a bargaining chip to induce states to establish their own exchanges." The American Cancer Society backed the notion that not only would ruling against subsidies put "9.6 million people at risk of losing coverage, it would make them more suspetible to chronic disease." 

For more:
- here's The Hill article
- check out the Talking Points Memo story
- read the National Journal piece
- here's the Washington Times article

Editor's Note: Editorial intern Sean West contributed to this report

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