HHS Secretary: Supreme Court Ruling Against Obamacare Would Harm Millions

Health and Human Services Secretary Sylvia Mathews Burwell on Monday rebuked critics who want the Supreme Court to invalidate Obamacare’s subsidies in much of the country, saying such a ruling would harm millions of Americans who “need, want and like” their health coverage.

Appearing at the White House, she said nearly 11.7 million new and returning customers selected a health plan on the law’s health exchanges through Feb. 22.

That figure is 300,000 higher than the 11.4 million she touted after the Feb. 15 deadline to get covered for 2015, as the administration gave HealthCare.gov customers in 37 states an extra week to finish up their applications.

Mrs. Burwell explicitly touted government subsidies that help American purchase plans on the Obamacare marketplace and averaged $263 per month for each enrollee.

That’s notable, beacuse a challenge before the Supreme Court has put the fate of those subsidies in doubt in at least 34 states.

The justices heard oral arguments in the case, with challengers saying the administration is breaking the law by paying the tax credits to customers in states that rely on the federal HealthCare.gov exchange. The law says subsidies can be paid to customers in exchanges “established by the state.”

Mrs. Burwell said she expects the administration expects to prevail, a result that would keep subsidies flowing to every state.

“The law is clear. The text and structure of the Affordable Care Act demonstrate that individuals in every state are eligible for tax credits,” she said. “Those who support this lawsuit believe that the law should be dismantled or repealed. And they are content to roll back the progress that we have achieved together.”

To underscore her point, Mrs. Burwell singled out Republican-governed states where residents benefited from the subsidies, including 1.5 million in Florida, more than 1 million in Texas and 500,000 in North Carolina.

“The simple truth is that millions of Americans in all 50 states rely on the Affordable Care Act for tax credits to buy insurance,” she said.

The Obama administration says it cannot fix the “massive damage” that a loss before the court would cause, as an estimated 6 million people would drop coverage that’s no longer affordable, particularly healthy people who keep rates in check.

Republican lawmakers are hoping to fill the void with a patchwork of proposals that freeze health coverage and financial assistance in place for Americans affected by the ruling, but only for a limited time as the GOP forges a replacement to Obamacare ahead of the 2016 presidential election.

Oklahoma Gov. Mary Fallin, a Republican, endorsed plans for targeted relief in an op-ed Monday published by the Tulsa World.

“We want to make sure people are able to keep their health insurance, but many governors do not want to be forced to create a state exchange or see our citizens lose coverage,” Ms. Fallin wrote. “We hope that Congress would offer targeted, temporary relief for people to maintain their current coverage while we work together on free-market, consumer-friendly solutions for the future.”

One possibility is that the court itself gives Congress and affected states a six-month grace period to adjust to a ruling that strikes down the subsidies.

Justice Samuel A. Alito Jr., a conservative who appeared ready to side with the plaintiffs, suggested the court could postpone the burnt of its ruling so that subsidies are not cut off until the end of the year.

He cited a past case, known familiarly as “Northern Pipeline,” in which the court stayed its decision to minimize disruption in the real world.

Congress’ nonpartisan research arm said “it is possible” for the court to delay its ruling.

“The court has held that the federal judiciary has significant inherent discretion to fashion remedies, and Congress has specified that the court has the authority to fashion remedies that are ‘just under the circumstances,’” the Congressional Research Service said in a report Monday.

But the scenario presented in the subsides case, known as King v. Burwell, differs from precedent in an important way, the researchers said.

In the past, the court delayed rulings so that entities like the Federal Elections Commission or bankruptcy courts could reconstitute how they carried out programs that were authorized by Congress.

In the Obamacare case, the issue is whether the subsidies doled out through IRS regulation “are themselves statutorily authorized,” the researchers wrote.

Michael Cannon, a health policy director at the libertarian Cato Institute and architect of the legal theory behind the “King” challenge, said it would be strange for the court to declare the IRS’ practice illegal, yet allow it to continue for several more months.

“That would be awkward, to say the least,” he said.

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