Attorneys for the King v. Burwell plaintiffs challenging a key the Act, and for the Obama administration defending the law, presented their conflicting views before the nine justices the Supreme Court Wednesday in 80 minutes oral argument.
As many court-watchers had anticipated, the justices seen as the court’s more liberal wing were skeptical the view argued by Michael A. Garvin, who represented the plaintiffs, that the phrase “an exchange established by the state,” present in a relatively obscure portion the 0-page act, should require the court to wipe out the subsidies received by more than 7 million low-income Americans.
Conversely, the justices regarded as more conservative asked Solicitor General Donald B. Verrilli Jr., who represented the Obama administration, tough questions about why he believed that, despite the plain meaning these words in the law, the administration believed residents in all states are eligible to receive federal subsidies or .
Unlike what may be common in lower courts, oral arguments made in Supreme Court cases are believed to have relatively little impact on the justices, who rely heavily on written briefs and their own legal analysis. A decision is expected by late June or early July.
However, the 95-page transcript Wednesday’s oral arguments does allow the public to see two brilliant litigators summarize their case.
Carvin, funded by the libertarian Competitive Enterprise Institute, is challenging subsidies in the 34 states whose residents rely the federal exchange or to buy , because there is no state-run exchange where they live.
He urged the justices to adopt a literal reading the statute, and to rule that residents the 34 states that do not have an “exchange established by a state” cannot receive subsidies.
Verrilli argued that the phrase has to be seen in context the massive law. He said Carvin’s interpretation “produces an incoherent statute that doesn’t work,” and “precipitates the market death spiral that the statutory findings specifically say the statute was designed to avoid.” In addition, he said, “it revokes the promises for millions Americans. That cannot be the statute that Congress intended.”
Justice Antonin Scalia responded, “It may not be the statute they intended. The question is whether it’s the statute that they wrote.”
Both sides debated whether Congress would have intentionally enacted a law that granted subsidies in some states but not others, thereby imposing potential financial strains on the states whose residents did not get subsidies – and would have done so without giving clear notice in advance to the affected states.
“If that was really the plan” Congress in writing the law, Verrilli said, then the consequences for the States would be in neon lights in this statute. You would want to make absolutely sure that every state got the message. But instead what you have is a subclause in Section 36B, which is a provision that addresses the taxpayer for tax purposes.”
Verrilli also noted that the relevant portions the lengthy bill were not the result rushed drafting or last-minute scrambling.
“The language that emerged here” about the subsidies and state exchanges “was the product the Senate Finance markup, which went for weeks and weeks. It was a public…hearing…covered by C-SPAN. You can go watch it the C-SPAN archives if you want to; and you will see coming out that…that the clear understand was this statutory setup would result in subsidies being available in every state.”
Verrilli also noted that the words “established by the state” are a longer phrase which says the state exchanges are to be established under a specific clause the Act that has to do with the related roles the federal and state exchanges, with the federal exchange to be available if a state exchange is not.
“This is a reasonable reading the particular textual provisions,” he argued, and “it is the only way to make sense the statute as a whole.” Key provisions the law about “qualified individuals” and “qualified ” would “lead to what they admit is an absurdity under their reading the law,” Verrilli said.
The law states that an Exchange must determine that a plan is “qualified” in terms the benefits it offers, and can only be sold to “qualified individuals,” who reside in the states that established the exchanges. (The Act prohibits insurers licensed in one state from selling in another where they are not licensed.)
Under the plaintiff’s interpretation, he noted, there would be no “qualified individuals” in the 34 states using the federal exchange, and no exchange to determine that a plan is “qualified.”
Thus Congress would have had to intentionally drafted a law with specific provisions for states without exchanges, but which could not function in those states – there would be no eligible to be sold, and no one in those states eligible to buy them.
Justice Anthony Kennedy wondered why the didn’t advise Congress about the possible ambiguity in the law when drafting its regulations for the .
Verrilli responded that “the statute expressly delegates to the the specific authority to make any decisions necessary” to implement the exchanges. “So you don’t have any ambiguity. Congress said the should do this.”
In his rebuttal, Carvin said that under the administration’s interpretation, the unconstitutionally violates the rights states. “The federal government gets to unilaterally impose States,” he said, “a requirement that States insure their own individuals” under the mandate. “Under their theory the states are absolutely helpless to stop this federal intervention in their most basic personnel practices.”