The Supreme Court is preparing to hand down a decision in the all-important King v. Burwell case, and Justice Anthony Kennedy could again play a key role in deciding the fate of healthcare reform.
Kennedy made a comment during the case’s oral arguments that led some observers to speculate that he was leaning toward siding with the Obama administration in the case, which centres on a key provision of the Affordable Care Act.
But Michael Cannon, the Cato Institute’s director of health policy and a key architect of the current challenge before the court, said that even if Kennedy sides with the administration in this case, it could end up being a long-term loss for the federal government.
Kennedy, the court’s traditional swing voter, said during the case’s oral arguments that he saw a “serious constitutional question” with the challengers’ interpretation of the Affordable Care Act.
The case revolves around the question of whether the federal government can hand out subsidies for health insurance in 34 states that have not set up their own insurance marketplaces. The challengers in King v. Burwell point to a part of the law that they say means Americans shouldn’t be able to receive subsidies unless individual states have set up marketplaces. The part of the law in question is four words specifying that subsidies should be issued to plans through an exchange “established by the state.”
But Kennedy expressed concern at invalidating that part of the law, for fear it would unfairly coerce states into setting up exchanges at the behest of the federal government. Here’s what he told the challengers’ lawyer, via the transcript:
“I fully understand that, but I think the Court and the counsel for both sides should confront the proposition that your argument raises a serious constitutional question. Now, I’m not sure that the government would agree with that, but it is in the background of how we interpret this statute.”
If Kennedy does side with the government on those grounds, it would be a win for the administration in the case. But it could open a new can of worms for a slew of laws that require federal-state cooperation.
“If Kennedy says the exchange deal is coercive, then he will be signalling — and anyone who signs on to a concurring opinion will be signalling — that they are interested in lowering the bar for proving that a co-operative federal program is unconstitutionally coercive,” Cannon told Business Insider.
“And that means that all sorts of federal/state programs could be vulnerable to be challenged as unconstitutional,” he added.
Some of those programs that he predicts would become newly vulnerable: the Clean Air Act, No Child Left Behind, and more. Some federal gun and immigration laws could also theoretically be challenged.
That kind of decision could end up benefiting any state that doesn’t want to participate in a joint federal program.
“If that happens, that’s a short-term win for the government but a long-term loss, if states can challenge all kinds of programs as unconstitutional,” Cannon said.
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