King v. Burwell: Constitutionality and the will of the people

By Marlo Safi / Columnist

Before you’re 26, you’re going to need to consider your own health care plan — without your parents. In two months, when the U.S. Supreme Court decides King v. Burwell, we’ll know just how costly your care could be.

The Affordable Care Act (ACA), or Obamacare, recommends states should set up their own marketplaces, or “exchanges,” where their residents can purchase health care. When consumers purchase health insurance in these state exchanges, the federal government provides subsidies, or “tax credits,” to those who would not otherwise be able to afford health care. 

Thirty-seven states declined to establish their own exchange, though, which means their residents have to purchase health care from the federal exchange. David King, the plaintiff, argues that the federal government should not grant subsidies to citizens in these states because of the six words this cases hinges on — “an exchange established by the State.”

If the verdict is in favor of King, subsidies purchased on the federal exchange will be annulled. This means an estimated 8 million people would lose their health care. Offering subsidies to millions of people is hurting the American taxpayer and small businesses, though. The Supreme Court, however, should focus on upholding the Constitution and the wording of this legislation — although the decision may be unpopular among those at risk of losing their health care.

Robert Rodrigues, a history professor at Duquesne University, said there is a constitutional issue at stake when the federal government provides subsidies to citizens on its exchange. 

“In the end, the Justices have to uphold absolute constitutionality despite the 8 million hanging in the balance,” Rodrigues said.

This entire case is a matter of the ACA’s language and Congress’s interpretation of that language’s intent. Rodrigues said “when there’s messy writing and the wordsmiths don’t get the intent right, you can have a constitutional issue.” 

Opponents of the ACA, like King, have interpreted the phrase “established by the State” to mean that only those purchasing health care on their state’s exchange are entitled to subsidies. However, the federal government has been distributing subsidies regardless of which exchange is being used to purchase health care, which is a breach of the ACA. 

Congress, though, argues that the phrase refers to an exchange either established by the state or federal government, and that the purpose of Obamacare was to provide insurance to low-income citizens regardless of where the insurance was purchased. 

When about 8 million Americans are dependent on these subsidies, many may wonder what heartless cretin would put Americans who couldn’t otherwise afford healthcare at risk. “Will deciding this case go against the will of the people? This is the dilemma,” Rodrigues said. 

Offering subsidies on a state exchange level is itself incredibly expensive, and offering subsidies on both federal and state levels costs an astounding amount of taxpayer money. In a 2015 Congressional Budget Office report, it is estimated to cost taxpayers $50,000 per enrollee in Obamacare over the next 10 years. 

The ACA also complicates financial issues for small businesses and general employees. When small business owners are faced with stringent regulations and must provide their employees coverage or pay a fine, employers must offset the costs by laying people off and cutting wages. According to the American Action Forum — a center-right policy institute that provides research for solving policy challenges — the ACA has reduced pay for employees at small businesses by at least $22.6 billion every year and has also put more than 350,000 Americans out of work.

Liberals often accuse conservatives of not having a plan after King v. Burwell is resolved — but they do. The National Center for Public Policy Research has released a spreadsheet that explains a conservative/libertarian health care approach that would follow the verdict. 

Through refundable tax credit, standard deduction, Health Savings Accounts (HSA) and employer-based tax exclusion, conservatives would replace Obamacare with a more free-market alternative.

King v. Burwell is a monumental case that could have substantial ramifications. “The Supreme Court takes, on average, one out of every 200 cases brought before it. The fact that four Supreme Court Justices want to hear King v. Burwell means they really want to make a ruling,” Rodrigues said.

Tune in to the ruling this June. Your home state might be one of those affected. In just a few years, we all need to have our own health care plan. We need to know just what the costs are.

Marlo Safi primarily writes about politics and public policy for The Pitt News.

Write to Marlo at [email protected].