5 Things To Watch In SCOTUS’ Obamacare Arguments

These questions will help determine who comes out ahead in the challenge to the Affordable Care Act’s insurance subsidies.

A guard stands on the steps of the Supreme Court Building, August 20, 2014 in Washington, DC. (Photo by Mark Wilson/Getty Images)
National Journal
March 1, 2015, 3 p.m.

Obama­care’s third date with the Su­preme Court is al­most here.

But this isn’t like the 2012 case over the in­di­vidu­al man­date, or even the Hobby Lobby case — both of which centered around high-minded con­sti­tu­tion­al ques­tions about the lim­its of con­gres­sion­al power — or the nature of com­merce. Wed­nes­day’s ar­gu­ments will fo­cus on the nitty-gritty of the law’s text, and wheth­er it has been im­ple­men­ted leg­ally in ac­cord­ance with that text.

The im­plic­a­tions for the law are sig­ni­fic­ant: some 7 mil­lion people would likely lose their cov­er­age if the court sides against the White House. Here are five ques­tions to watch for, which will help de­term­ine who walks out of the courtroom vic­tori­ous in King v. Bur­well:

How broad is John Roberts’ fo­cus?

Both sides in this case be­lieve the text of the Af­ford­able Care Act is all they need to win — and it might be their only chance, giv­en the con­ser­vat­ive justices’ gen­er­ally strict ap­proach to stat­utory in­ter­pret­a­tion. Dav­id Rivkin, who’s ar­guing for the chal­lengers, will want the court to start its ana­lys­is with six words in the for­mula for cal­cu­lat­ing Obama­care’s sub­sidies: the line that refers to sub­sidies flow­ing through “an Ex­change es­tab­lished by the State.”

(RE­LATED: Why the Obama­care Case Drives Wash­ing­ton Crazy

So­li­cit­or Gen­er­al Don­ald Ver­rilli, on the oth­er hand, will want the court to think of “the text” as broadly as pos­sible — to fo­cus on sec­tions that treat state and fed­er­ally run ex­changes as in­ter­change­able, at least prac­tic­ally.

Chief Justice John Roberts has said in past de­cisions that the court should con­sider the text of en­tire stat­utes, so he should be at least open to Ver­rilli’s tack. But the weak­est spot in the Justice De­part­ment’s ar­gu­ment is ex­plain­ing why the words “es­tab­lished by the State” ap­pear in the sub­sidies for­mula, if not to lim­it sub­sidies to state-run ex­changes. So it’s also easy to ima­gine Roberts prod­ding the so­li­cit­or gen­er­al on that point.

If Roberts moves off of those few words eas­ily and en­gages with oth­er sec­tions of text — in­clud­ing the phrase “such ex­change” or the defin­i­tion of a “qual­i­fied in­di­vidu­al” who can use the ex­changes — it’ll prob­ably be a good sign for the gov­ern­ment. If he de­mands an an­swer on “es­tab­lished by the State,” Ver­rilli will likely have a much harder time.

Will any­one care about fed­er­al­ism?

The fed­er­al­ism strand of the pro-Obama­care ar­gu­ment has got­ten more at­ten­tion in the pub­lic de­bate lately than it has in the ac­tu­al briefs in the case, but it’s one that could ap­peal to both Roberts and Justice An­thony Kennedy. It’s an ex­ten­sion of one of the gov­ern­ment’s tex­tu­al ar­gu­ments: If Con­gress ac­tu­ally wanted to lim­it Obama­care’s sub­sidies to states that ran their own ex­changes, why would it bury that ex­tremely im­port­ant in­form­a­tion in a for­mula?

A group of pro-Obama­care states ar­gued in a brief to the Su­preme Court that, when they made their de­cisions about set­ting up a state-run ex­change, no one told them their de­cision could deny sub­sidies to their res­id­ents and throw their in­sur­ance mar­kets in­to chaos. And that would have been pretty use­ful in­form­a­tion.

The ar­gu­ment is aimed at Roberts, who has said pre­vi­ously that states de­serve “clear warn­ing” of the strings Con­gress at­taches to their de­cisions; and to Kennedy, who’s seen as more likely than his fel­low Re­pub­lic­an ap­pointees to base his de­cision on factors oth­er than the text. Jonath­an Adler, one of the con­ser­vat­ive leg­al schol­ars who helped make this chal­lenge hap­pen, has said he takes the fed­er­al­ism ar­gu­ment ser­i­ously.

Is the law am­bigu­ous?

Both sides ar­gue that the law is clearly on their side. But what if it’s not?

(RE­LATED: Re­pub­lic­ans See Lever­age From Su­preme Court for Obama­care Over­haul

There’s a way for the chal­lengers to win if the justices de­cide the law is un­clear, but the gov­ern­ment has the bet­ter odds. In many cases, when stat­utes are un­clear, the courts de­fer to the in­ter­pret­a­tion of the agen­cies im­ple­ment­ing them. That prin­ciple, known as Chev­ron de­fer­ence, has been around for a long time, and it was the basis on which a lower court up­held Obama­care’s sub­sidies na­tion­wide.

To have their strongest day, the chal­lengers in King would need to per­suade the court that the law clearly and un­am­bigu­ously lim­its sub­sidies only to cer­tain states. If the court seems to think the stat­ute is un­clear, it’ll be a ques­tion of how it settles that am­bi­gu­ity: through Chev­ron de­fer­ence; or by say­ing, in ef­fect, the text says what it says, even if it wasn’t meant to.

What about the prac­tic­al im­plic­a­tions?

As a policy mat­ter, the sub­sidies are part of a “three-legged stool” de­signed to make the Af­ford­able Care Act work. Wipe out one leg of that stool, and the whole sys­tem could be­gin to tip over. Sim­il­arly, Obama­care is real now: About 11 mil­lion people have cov­er­age through the law’s ex­changes, and the ma­jor­ity of them would lose that cov­er­age if the court sides with King.

None of that mat­ters, leg­ally. But in a case that comes down to pars­ing one small phrase versus an­oth­er, leg­al ex­perts say, there’s plenty of room for oth­er, non-leg­al con­sid­er­a­tions.

They could cut either way: Some lib­er­als worry that Kennedy has simply made up his mind about Obama­care and won’t be es­pe­cially open to ar­gu­ments he might oth­er­wise find per­suas­ive. On the oth­er hand, since Kennedy of­ten is will­ing to think more about the real-world ef­fects of his rul­ings, some ana­lysts think the pro­spect of ac­tu­ally tak­ing away people’s health care — a real­ity that didn’t ex­ist yet in 2012 — will push him away from a nar­row read­ing of the text.

Does stand­ing mat­ter?

Stand­ing — the leg­al right to bring a law­suit — is an­oth­er is­sue most likely to mat­ter as a sort of sub­text, but leg­al ex­perts fol­low­ing the case are eager to see wheth­er it comes up at all dur­ing or­al ar­gu­ments.

Lately, ques­tions have aris­en about wheth­er some of the plaintiffs in King have stand­ing. They’re su­ing to ex­empt them­selves from the in­di­vidu­al man­date (which is triggered by re­ceiv­ing sub­sidies), but sev­er­al of them might be ex­empt from it any­way. At least one plaintiff ap­pears likely to have stand­ing, so the case will prob­ably go for­ward — but the left has sought to play up the stand­ing ques­tions lately in part to frame the case as simply a polit­ic­al at­tack on Obama­care, lack­ing in leg­al ser­i­ous­ness.

(RE­LATED: The One Word That Could Save Obama­care

Chris Walk­er, a law pro­fess­or at Ohio State Uni­versity, said stand­ing might give the justices an es­cape hatch if they come away from or­al ar­gu­ments not want­ing to rule defin­it­ively.

“I think it’s a sleep­er is­sue that could be­come a real chal­lenge,” Walk­er said.

The Su­preme Court can, at any time, simply de­cide not to rule in a case it ac­cep­ted. Cases are “dis­missed as im­provid­ently gran­ted” — and the justices don’t have to ex­plain why they’re not rul­ing. That could hap­pen here, Walk­er said, if the court de­cides that King is a bad vehicle for this is­sue, or if the con­ser­vat­ives want to try again with bet­ter plaintiffs — in which case we’d likely end up right back here a few years from now.

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