A critical make-or-break decision on the future and sustainability of the Affordable Care Act will be considered by the US Supreme Court, it was decided Friday.
King v. Burwell challenges the legality of the tax credits provided to shoppers on the federal health insurance marketplace, HealthCare.gov. Language in the ACA specifies that subsidies are allowed on exchanges “established by the states,” but courts disagree over whether Congress had the authority to extend those tax credits to the federal exchange.
In the event subsidies are axed, health insurance could become unaffordable for the millions of Americans that rely on HealthCare.gov. Subsequently, the law’s individual mandate would become unenforceable.
Congress could amend the ACA to include subsidies for the federal exchange, but this task is believed to be difficult with the incoming Republican-controlled Congress. Similarly, the three-quarters of states relying on HealthCare.gov are unlikely to establish an exchange of their own given Republican authority in the legislatures and governorships of those states.
This is the second time the Supreme Court has considered whether to hear the case, but an announcement on the decision was not expected until Monday at the earliest, according to a report from Law360.
Previously, district courts had remained divided over the legality of the subsidies, with Judge Ronald White of Oklahoma ruling they represent an “invalid implementation” of the ACA, while the 4th US Circuit Court of Appeals upheld the subsidies.
If subsidies are struck down, the National Association of Health Underwriters believes it unlikely the government would require clients to repay those subsidies retroactively, “assuming that the individual was legally eligible for the subsidy at the time of the receipt.”
However, without subsidies, it is likely producers will find themselves without clients and the accompanying commission on the federal healthcare exchange.
The case is David King et. al. v. Sylvia Matthews Burwell.
