Inside Story

Another near-death experience survived, but Obamacare’s immortality is still not guaranteed

The US Supreme Court annoyed conservatives twice last week, fuelling an even more divisive presidential race, writes Lesley Russell

Lesley Russell 29 June 2015 1488 words

A legacy moment: president Barack Obama with vice-president Joe Biden (left) and staff members after hearing news of the Supreme Court’s Obamacare decision. Pete Souza/White House

Two decisions brought down last week by the US Supreme Court – on the Affordable Care Act, or ACA, and same-sex marriage – will help cement Barack Obama’s legacy while deepening the divisions between Democrats and Republicans that will play out in the 2016 presidential campaign.

The decision on the healthcare law, popularly known as Obamacare, was a decision for common sense. The ACA requires virtually all Americans to carry health insurance and provides tax credits to help them afford it. The petitioners claimed that the law meant that tax credits could only be given to people in states with state-operated exchanges – an interpretation predicated on a narrow reading of a few words taken out of context.

Despite what chief justice John Roberts called the “inartful” language in the ACA’s text, the Supreme Court decided that Congress fully intended that tax credits should be available to all eligible people, regardless of whether they were using federal or state health insurance exchanges. As the majority opinion stated:

Congress made the guaranteed issue and community rating requirements applicable in every state in the nation, but those requirements only work when combined with the coverage requirement and tax credits. It thus stands to reason that Congress meant for those provisions to apply in every state as well.

The Supreme Court decision means that low- and middle-income people in all fifty states will remain eligible for federal subsidies to help pay for the cost of health insurance.

Importantly, the court determined that future administrations can’t choose to interpret this provision of the law differently. The court didn’t rely on the executive agency’s interpretation of the statute in reaching its decision, and it found that the Congress didn’t intend to delegate this important issue to the executive branch.

This is the second time in three years that the Supreme Court has upheld the central provisions of the ACA. It is also the second time that the chief justice (who was appointed by president George W. Bush) has written the critical opinion upholding those provisions.

While the issue before the court was how to interpret the language and purpose of the statute, economic analyses played a key part in its decision. The majority opinion recognised that the availability of subsidies is an issue of “economic and political significance” to the healthcare reforms. As Roberts explained at the end of the court’s majority opinion, “Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them.”

Had the legal challenge been successful, estimates suggest that as many as 8.2 million people would have lost their insurance. The 6.4 million people currently enrolled in federal exchanges and receiving a tax credit would have been most directly affected because they would have lost the chance to purchase affordable health insurance.

Some health policy analysts predicted that this would have undermined the mandate requiring health insurance cover (the subject of the previous ACA ruling by the Supreme Court) in states with federal exchanges. As insurers would still be required to cover all purchasers, regardless of pre-existing conditions, this could have led to rapid rises in premiums and the possible collapse of health insurance markets.

When the court agreed to hear the case – surprisingly, because other cases on the same issue were still under way in four federal circuits – supporters of the ACA were understandably nervous. Their nervousness was only heightened by the justices’ demeanours during the oral arguments. But the Supreme Court’s 6–3 decision allayed those fears. The court is unlikely to accept another ACA case, so the threat to the ACA from litigation can be considered over. But having won this life-or-death battle, the law is still not guaranteed immortality.

Republican efforts to undo the ACA will continue in the political sphere. This was highlighted by the raft of scathing responses to the court’s decision from the ever-growing cadre of Republican presidential candidates; to them, the ruling changed nothing about the law they detest.

“This fatally flawed law imposes job-killing mandates, causes spending in Washington to skyrocket by $1.7 trillion, raises taxes by $1 trillion and drives up healthcare costs,” claimed Jeb Bush, ignoring all the evidence to the contrary. “This decision is not the end of the fight against Obamacare.”

Most candidates showed their contempt for the justices who drove the decision. “[They] have once again erred in trying to correct the mistakes made by President Obama and Congress in forcing Obamacare on the American people,” said senator Marco Rubio. Mike Huckabee termed the decision “an out-of-control act of judicial tyranny.” And senator Ted Cruz accused the court of usurping the role of Congress. “Unelected judges have once again become legislators, and bad ones at that,” he said.

Needless to say, their ire was further inflamed by the decision on marriage equality, released a day later. Governor Bobby Jindal was perhaps the most extreme in his condemnation. “The Supreme Court is completely out of control, making laws on their own, and has become a public opinion poll instead of a judicial body. If we want to save some money, let’s just get rid of the court,” he said in a statement issued after the decision on gay marriage was brought down.

The antagonism and division extends even to the Supreme Court itself. The two most conservative justices, Antonin Scalia and Samuel Alito, have thrown some nasty verbal punches at their more progressive colleagues. Using an abbreviation of the court’s full title, Scalia said that Obamacare could now be called “SCOTUScare” and Alito accused the majority of advancing the irredeemable corruption of the nation’s legal culture.

The Supreme Court and its decisions always play out as key issues in presidential races. The decisions this week give Republicans a twin-barrelled weapon with which to galvanise conservative voters in 2016. They realise that the only chance they have to roll back the law is to win the White House and keep control of the Congress in 2016. The presidency also offers the chance to play a key role in shaping the future focus of the Supreme Court, with the possibility of replacing as many as three justices.

But even these victories in 2016 might not be enough. It would take until well into 2017 before legislation to abolish or curb the ACA could be drafted and enacted and more months before a new law of any magnitude could take effect.

By then the reality would be that some thirty million Americans not previously covered would have health insurance, and all the benefits that come with that. The insurance companies, hospitals, drug and medical device manufacturers, and state budgets all benefit too. There would be a large constituency opposed to giving up these benefits even if they are not fully supportive of the law that delivered them. Moreover, the independent Congressional Budget Office estimates that the total budget gap between 2016 and 2025 would rise by US$353 billion if Obamacare were eliminated.

It’s not surprising that Democratic presidential candidate Hillary Clinton has hailed the ruling. She and other Democrat lawmakers have called on Republicans to end their attacks on the ACA, in particular their efforts to repeal the law or its key provisions. Her pleas and those of President Obama to Congressional Republicans to stop “refighting battles that have been settled again and again” have been met with the usual hostility.

In celebrating the Supreme Court’s decision, President Obama mused over why public support for Obamacare is still tepid. The law is not just working as intended, but on a range of metrics is actually working better than projected. A major failure is that the ACA’s supporters have never owned the dialogue; the law’s critics have consistently presented a much louder and more certain attack and their scare stories and anecdotes have won out over facts. Prejudice and a lack of informed awareness means that many people repudiate “Obamacare” while saying they support the Affordable Care Act.

Perhaps President Obama himself has best summarised his healthcare reform legacy five years on from the law’s enactment: “The point is this is not an abstract thing anymore. This is not a set of political talking points. For all the misinformation campaigns, all the doomsday predictions, all the talk of death panels and job destruction, for all the repeal attempts – this law is now helping millions of Americans.”

Obamacare, he said, is now “woven into the fabric of American lives.” But with the current level of political animosity towards the law and poor public support it will need another Democrat in the White House to ensure that the fabric is not rent asunder. •