The Supreme Court has issued its opinion in King v. Burwell, the much anticipated case regarding whether Affordable Care Act subsidies are available to purchasers of insurance on the Federal Exchange or whether the plain language of the Act restricted such subsidies to only those purchasing insurance through an “Exchange established by the State.” The Court, over strongly worded dissent, determined that the Act permitted payment of subsidies for insurance purchased through the Federal Exchange, leaving Obamacare, as it is known, intact. Had the court ruled as the dissent held, then millions of people would have effectively been exempted from the requirement to purchase health insurance (the “individual mandate”) because their health insurance cost, when not supplemented by a subsidy, would have exceeded 8% of income. The outcome of such a decision could have led to the “death spiral” for the Act, since the underlying financial assumptions that keep insurers in business are directly related to the effectiveness of the individual mandate.
The Court’s decision will provide certainty in the healthcare marketplace. King v. Burwell was widely seen as the last, and best, chance for opponents of the Act to obtain a judicial veto of the Act. Opponents of Obamacare now realize the Court will make every effort to uphold the Act in future cases.
Read Supreme Court Opinion here: Supreme Court Opinion