Another Judicial Threat to Obamacare

Obamacare is still in trouble Russell Berman writes at The Atlantic:

While Chief Justice John Roberts effectively saved the law by voting with liberals to uphold its individual insurance requirement in 2012, this new case could unravel Obamacare in another way. The plaintiffs in the challenge that the justices accepted on Friday, King v. Burwell, argue that the text in the law as passed by Congress specifies that only people who buy insurance through exchanges established by states are eligible for federal subsidies. Because 36 states did not create their own exchanges, millions of Americans enrolled in new insurance plans through the federal website, Healthcare.gov, and a vast majority of them received public assistance. It is the subsidies provided to those consumers that are now being called into question.
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Would Roberts, the court's swing vote in its first landmark ruling on Obamacare, join a decision gutting it just two-and-a-half years later? It's hard to see, but there's enough of a chance to worry supporters of the law. Nicholas Bagley, a professor at the University of Michigan Law School writing at the healthcare blog, the Incidental Economist, argued on Friday that the court's decision to hear the case was an ominous sign for Obamacare. The move, he wrote, "substantially increases the odds that the government will lose this case."

From our July 26 post:

 Following the plain text of the Affordable Care Act,  the US Court of appeals for the DC Circuit ruled in Halbig v. Burwell, that insurance buyers can only get the federal tax credits if they purchase through a state exchange.  Liberals say that the wording was a mistake.  Conservatives say that it is the letter of the law, and in any case, was deliberate.  Adam Serwer reports at MSNBC:
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Gruber’s remarks, seen in a video discovered by a commenter on the conservative legal blog Volokh Conspiracy named Rich Weinstein, were publicized by the Competitive Enterprise Institute, a conservative group backing the lawsuits. Here’s an excerpt, which begins about 30 minutes in.

The challengers got a boost Thursday evening when a video surfaced showing Massachusetts Institute of Technology professor Jonathan Gruber, an adviser to the Obama administration during the drafting of the health care law, saying in 2012 that subsidies weren’t available on federal exchanges.

What’s important to remember politically about this is if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits— but your citizens still pay the taxes that support this bill. So you’re essentially saying [to] your citizens you’re going to pay all the taxes to help all the other states in the country. I hope that that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these exchanges. But, you know, once again the politics can get ugly around this.