Will the Roberts Court Buy Conservatives’ False Choice on Health-Care Subsidies?

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Analysis Law and Policy

Will the Roberts Court Buy Conservatives’ False Choice on Health-Care Subsidies?

Jessica Mason Pieklo

Conservatives offer up a series of false choices for the Supreme Court in their challenge to health insurance subsidies in federal exchanges, including wrongly comparing the Affordable Care Act to Medicaid. It shouldn't work, but it might.

Conservative politicians love the illusion of choice. When they legislate against abortion rights, for example, they applaud those who “choose” life while simultaneously working to eradicate any true options for reproductive health care. When they stymie action on climate change, they justify such obstructions based on their “choice” to believe ideologically driven pseudo-science over the mounting evidence that humans have played a massive role in environmental degradation. And when it comes to their attacks on the Affordable Care Act, conservatives insist that they are trying to give people the right to “choose” freedom from burdensome government regulation—and leave millions without health-care coverage in the process.

That illusion of choice is precisely what makes the Supreme Court’s surprise decision last week to hear the latest round of challenges to the ACA so dangerous to the long-term prospects of the law.

In King v. Burwell, conservatives have set their sights on one of the cornerstones of the ACA: the premium tax credits, otherwise known as subsidies, available to some individuals to help offset the cost of their health insurance premium. The conservative plaintiffs in King argue that the language of the ACA allows only the states, and not the federal government, to offer these subsidies for health insurance purchases. They claim that Congress dictated that the subsidy would apply only to exchanges “established by the state,” and argue those four words in the statute limit the availability of those tax benefits solely to state-run exchanges.

This approach, the ACA challengers argue, was designed to work like Medicaid does, by providing motivation for states to buy into the health-care law and establish their own exchanges. By enforcing this interpretation, the plaintiffs claim, they are advocating for the “choice” they say Congress intended for states: Play ball and get on board with the new health-care law, or we’ll punish your residents by withholding their tax credits.

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The problem with this argument, as Yale Law School Professor Abbe Gluck details over at SCOTUSblog, is that it is just flat-out wrong. Medicaid explicitly warns that states that don’t cooperate and follow along with the federal government’s rules in how to spend Medicaid dollars lose funding. There is no fallback, safety net, or other catchall for those individuals who rely on Medicaid services but happen to live in a state where lawmakers are playing politics with its funding. The fight over Title X family-planning money in Texas is an excellent example of Gluck’s point: When Texas Republicans moved to exclude Planned Parenthood from the state’s Medicaid Women’s Health Program in violation of federal law, the Obama administration cut off all Medicaid funding for family-planning services to the state. This left Texans bearing the burden of those cuts and at the mercy of whatever state-funded programs lawmakers created.

The ACA, however, doesn’t work that way. Rather than cut off those 34 states that fail to establish their own exchanges, leaving locals either without insurance coverage or stuck with coverage they cannot afford, the ACA mandates that the federal government step in with its own exchange for purchasing insurance. That means that residents can still receive more affordable health insurance coverage, regardless of their state government’s political reaction to the law. And this should include accessing tax credits to help pay for that coverage.

In other words, Congress didn’t push for states’ ability to make a “choice” to opt out of tax credits for their residents, no matter what conservative opponents may claim.

Conservatives challenging the ACA have, unsurprisingly, glossed over these critical flaws in their argument, insisting this is really a straightforward case of statutory interpretation. And for the conservative justices on the Roberts Court who have eagerly accepted similar false choices in other contexts such as affirmative action, voting rights, and abortion clinic buffer zones, that’s a difference that may not matter.

But the difference should matter. The fact that we are even here again, weighing the possible legal and political outcomes to yet another challenge to health care reform, says so much about the state of our judiciary. And none of it is good. Remember when conservatives complained about the tens of thousands of pages of regulations associated with the health-care reform law as proof the ACA was unworkable and unconstitutional? After that argument failed, they constructed the challenge in King, which puts forward exactly the opposite premise. This time conservatives argue the thousands of pages of statutory text can—and should—be reduced and effectively summarized by four words: “established by the state.” This, as it happens, would undercut the entire regulatory goal of the ACA, which is to expand private health insurance coverage for as many Americans as possible.

The conservative challengers want us to believe, and the Court to accept, that the fates of nearly five million people who have received subsidies to help pay for insurance on one of the federal government’s 34 exchanges should hang in the balance of that phrase. As detailed here, here, and here, there are a myriad of legal reasons why the claims in King should fail.

But the fact remains that at least four Supreme Court justices are willing to consider the challengers’ case, and they only need one more justice on their side to win it.

Amazingly, it is Justice Antonin Scalia who should offer even the conservatives on the Roberts Court a path to the right conclusion here. In defending his “traditionalist” approach to the law, Justice Scalia has argued that the Court’s role is to adopt the interpretation that “does least violence to the text.” In the case of King, that would leave the Roberts Court with no other choice but to uphold the federal government’s ability to offer subsidies in its exchanges. Any other ruling will result in catastrophic loss of coverage, which is not simply violence to the text, but rather violence to our people.