King v. Burwell – The Supreme Court Ruled to Uphold the Affordable Care Act’s Subsidies

Written by:
Attorney Jennifer Knudson

On June 25, 2015, the United States Supreme Court published its decision in King v. Burwell.  In a 6-3 opinion written by Chief Justice Roberts, the Supreme Court upheld the availability of federal subsidies under the Affordable Care Act (ACA) for taxpayers who purchase health insurance on exchanges established by the federal government.

In reaching its decision, the Court needed to interpret the language of the ACA which provided that coverage was available for those individuals œenrolled in an Exchange established by the State.  Of the fifty states, only sixteen (plus Washington D.C.) had opted to operate their own exchanges; thirty-four states had elected to let the federal government do so on their behalf.  The federal government follows the practice of offering subsidies to all individuals enrolled in an exchange, whether through a state-run or a federal exchange.

The Court admitted that parts of the law were ambiguous, but that the law was to be read as a whole rather than in its isolated parts.  The majority opinion provided: œCongress 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’s the reading we adopt.

This ruling brings closure to the most recent challenge to the ACA, and in essence, leaves the status quo–the availability of subsidies for health insurance purchases on a federal exchange–in place.