A Second Round for Obamacare at the Supreme Court

The Supreme Court is wading back into another contentious legal debate over the Affordable Care Act, agreeing to hear a case challenging subsidies issued through the law's federal insurance exchange.

While Chief Justice John Roberts effectively saved the law by voting with liberals to uphold its individual insurance requirement in 2012, this new case could unravel Obamacare in another way. The plaintiffs in the challenge that the justices accepted on Friday, King v. Burwell, argue that the text in the law as passed by Congress specifies that only people who buy insurance through exchanges established by states are eligible for federal subsidies. Because 36 states did not create their own exchanges, millions of Americans enrolled in new insurance plans through the federal website, Healthcare.gov, and a vast majority of them received public assistance. It is the subsidies provided to those consumers that are now being called into question.

Separate challenges to the provision have made their way through appellate courts, and the justices chose to accept an appeal of a ruling in favor of the Obama administration by the Richmond-based Fourth Circuit Court of Appeals in July. The full D.C.-based appellate court plans to hear another subsidies challenge after a three-judge panel struck down the provision over the summer.

The law's defenders—and its Democratic authors—say the case hinges on what amounts to a typo in the law. In an op-ed in The Washington Post last week, the five Democrats who were committee chairmen during the debate over the law in 2010 wrote: "In an attempt to make their case, the law’s opponents cherry-pick one four-word phrase—'established by the State'—from the formula used to determine how much financial help Americans are eligible to receive and use this phrase to argue that assistance isn’t available to people living in states that decided to use the federal marketplace. But the language on which the law’s opponents rely means no such thing."

"The Affordable Care Act makes financial help available to working Americans in every state. That is the law we intended," they wrote. "That is the law we enacted."

At the White House on Friday, press secretary Josh Earnest made a similar point, saying the congressional intent "is quite clear." "We continue to have high confidence in the legal argument, both from a legal perspective and a common sense perspective," he said.

Would Roberts, the court's swing vote in its first landmark ruling on Obamacare, join a decision gutting it just two-and-a-half years later? It's hard to see, but there's enough of a chance to worry supporters of the law. Nicholas Bagley, a professor at the University of Michigan Law School writing at the healthcare blog, the Incidental Economist, argued on Friday that the court's decision to hear the case was an ominous sign for Obamacare. The move, he wrote, "substantially increases the odds that the government will lose this case."

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