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Supreme Court Allows Continuation of Affordable Care Act Subsidies in All States

On June 25 the U.S. Supreme Court issued a long-awaited decision in the King v. Burwell case, ruling that subsidies to help people purchase insurance coverage under the Affordable Care Act (ACA) -- popularly known as Obamacare -- are valid in all states, not just those that established their own insurance exchanges. The 6-3 decision will enable an estimated 6 million people to keep their subsidized health plans.

The Patient Protection and Affordable Care Act, enacted in March 2010 after a long legislative battle, requires that all individuals purchase health insurance or obtain coverage through an employer. To make this possible, the law banned insurance exclusions due to pre-existing conditions, allowed states to dramatically expand their Medicaid programs (30 states have done so), and offered subsidies to help people afford individual and family coverage.

While 16 states and Washington, DC, have set up their own insurance exchanges or marketplaces, 34 others declined to do so and their residents could instead purchase insurance through the federal exchange (Healthcare.gov). At issue in King v. Burwell was whether these tax credit subsidies were available only to people who signed up using a state exchange or also to those who enrolled through the federal marketplace. Approximately 85% of people who enrolled through Healthcare.gov are eligible for subsidies.

In 2012 the Supreme Court upheld the ACA's individual mandate requiring that everyone must purchase insurance or face a tax penalty, but also ruled that states were not obligated to expand their Medicaid programs. A prior ruling by the 4th U.S. Circuit Court of Appeals in 2014 held that language about the scope of the subsidies was ambiguous and subject to multiple interpretations, and therefore government agencies could determine how to implement the law.

The 6 justices who ruled in favor of the Obama Administration this week -- Chief Justice John Roberts, Stephen Breyer, Ruth Bader Ginsburg, Elena Kagan, Anthony Kennedy, and Sonia Sotomayor -- agreed with the circuit court's ruling.

"Congress passed [the ACA] to improve health insurance markets, not to destroy them," Roberts wrote for the court's majority. "If at all possible, we must interpret the act in a way that is consistent with the former, and avoids the latter." He added that eliminating subsides "would destabilize the individual insurance market" in states relying on the federal exchange, and could create a "death spiral" as people who could no longer afford coverage withdrew from the marketplace.

Justices Samuel Alito, Clarence Thomas, and Antonin Scalia dissented.

"It is up to Congress to design its laws with care...and it is up to the people to hold them to account if they fail to carry out that responsibility," Scalia wrote, referring to the majority decision as "interpretive jiggery-pokery."

"[T]he Affordable Care Act is here to stay," said President Obama in response to the ruling. "If the partisan challenge to this law had succeeded, millions of Americans would have had thousands of dollars worth of tax credits taken from them."

Health Organizations Respond

Numerous health organizations praised the decision.

"HIVMA applauds the Supreme Court's decisive ruling in the King v. Burwell case to affirm the availability of federal subsidies in the health insurance marketplaces in every state -- a critical victory for millions of low-income individuals nationwide, including many with HIV, and a victory that must put us squarely on a path to focus on implementing the Affordable Care Act fully and effectively in every state, including the Medicaid expansion," said Adaora Adimora, chair of the HIV Medicine Association.

"This ruling ensures that health insurance tax credits will remain available in all states and more importantly that health insurance will remain affordable for those people who receive it through the exchanges," said American Public Health Association executive director Georges Benjamin. "Today, more than 6 million Americans can breathe a sigh of relief...We know that when people can't afford health insurance, they don't get health care -- and get sicker as a result."

As described in APHA's friend of the court brief, "the Supreme Court eliminated the threat of 9800 preventable deaths per year by keeping health insurance affordable," Benjamin continued. "Just as importantly, many of the 34 states that use the federal exchange -- and face a disproportionate burden of chronic disease, cancer deaths, infant mortality, and health inequity -- can keep their residents healthier."

"Women, in particular, can breathe a sigh of relief today," concurred Debra Ness, president of the National Partnership for Women and Families. "[The ACA] has been the greatest advance for women's health in a generation."

ACA Resources for People with HIV and Hepatitis

The Greater Than AIDS website, Health Coverage, HIV & YOU, was designed to help people living with HIV research their health insurance options. A recent Kaiser Family Foundation brief presents profiles highlighting how ACA coverage expansions have affected HIV-positive people's access to coverage and care. Project Inform, the San Francisco AIDS Foundation, and other organizations put together a guide to help California residents find appropriate plans through Covered California that include coverage for HIV, hepatitis C, or PrEP.

6/25/15

Sources

Supreme Court of the United States. King et al. v. Burwell, Secretary of Health and Human Services, et al. Case 14-114. June 25, 2015.

J Hancock. Roberts Leads Court In A 6-3 Decision Upholding Health Law Subsidies. Kaiser Health News. June 25, 2015.

S Firth and J Frieden. Court Saves Obamacare's Bacon. MedPage Today. June 25, 2015.

National Partnership for Women and Families. Supreme Court Upholds ACA Tax Credits. Women's Health Policy Report. June 25, 2015.

American Public Health Association. APHA Cheers Supreme Court’s Decision to Keep Health Coverage Affordable in Every State. Press release. June 25, 2015.