June 25, 2015 Article

Health Law and Employment Law Alert: Supreme Court Rules in King v. Burwell

Today, the U.S. Supreme Court ruled 6-3 in the King v. Burwell case to uphold federal subsidies in the states where  the federal government is operating the insurance Marketplace under the Affordable Care Act. The majority ruled that the literal interpretation of the  provision in question did not make sense in the larger context of the law. In his majority opinion upholding the subsidies, Chief Justice Roberts wrote:

“Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the Act in a way that is consistent with the former, and avoids the latter.”

A link to the Court’s opinion can be found at the following link: http://www.supremecourt.gov/opinions/14pdf/14-114_qol1.pdf.

The Affordable Care Act provided states with a  choice to either build their own healthcare marketplace exchange or use an  exchange run by the federal government. In total, 34 states decided to use the  federal exchanges. Had the highest court ruled against the Obama administration, about 6.4 million people in those 34 states, including Maine and New Hampshire, would have been at risk to lose their subsidies. The Bangor Daily News  reported that:

“In Maine, nearly 90 percent  of the 68,000 residents who enrolled in health insurance under the law received  subsidies to help them afford their monthly premiums. Without the financial leg up, the average premium would have shot up nearly 400 percent, from $88 to $425  per month, according to an analysis by the Kaiser Family Foundation.”


With this decision, the subsidies provided to participants in federal insurance exchanges will continue.