Chief Justice John G. Roberts and Justice Anthony M. Kennedy are seen by many court watchers as the two potential swing votes in the case.
The U.S. Supreme Court on Wednesday heard arguments in a second challenge to the Patient Protection and Affordable Care Act that, if affirmed, could disqualify millions of Americans from receiving billions of dollars in federal subsidies to buy health insurance.
Plaintiffs in King vs. Burwell told the justices that the wording of PPACA prohibits the federal government from offering subsidies for people in 34 states that used a federal healthcare exchange. [View transcript.]
As in 2012's landmark National Federation of Independent Business vs. Sebelius ruling that saw a sharply divided court uphold the constitutionality of the individual mandate on a 5–4 ruling, King is also expected to swing on one vote.
"The only provision in the Act which either authorizes or limits subsidies says, in plain English, that the subsidies are only available through an exchange established by the state," plaintiff's attorney Michael Carvin told justices on Wednesday, the second time in three years that Carvin has argued against PPACA before the high court.
Solicitor General Donald B. Verrilli, who successfully argued for the federal government in NFIB, argued on Wednesday that the intent of the PPACA is clear. Without the subsidies, he argued, health insurance would become unaffordable.
"It is really the only way to make sense of Section 36B and the rest of the act," Verrilli told the court, citing the passage in question. "Textually, [the plaintiff's] reading produces an incoherent statute that doesn't work."
"Our reading is compelled by the act's structure and design. Their reading forces [the Department of Health and Human Services] to establish rump exchanges that are doomed to fail. It makes a mockery of the statute's expressed textual promise of state flexibility."
Chief Justice John G. Roberts, seen by many court watchers as one of two potential swing votes in the case, remained silent for most of the arguments, which he extended for 20 minutes beyond the allotted hour.
Justice Anthony M. Kennedy, however, who is seen as the other potential swing vote, set off a flurry of speculation when he told Carvin that the plaintiff's argument "raises a serious constitutional question."
"Let me say that from the standpoint of the dynamics of Federalism, it does seem to me that there is something very powerful to the point that if your argument is accepted, the states are being told either 'create your own exchanges, or we'll send your insurance market into a death spiral,'" Kennedy said. "We'll have people pay mandated taxes which will not get any credit on the subsidies. The cost of insurance will be sky high, but this is not coercion."
To give a sense of the close scrutiny this case is getting, BloombergBusiness reported that for-profit hospital stocks surged immediately after Kennedy's comments.
Although the arguments were tense and polarized, the day was not without comic relief. When Verrilli warned of the dire consequences of removing the subsidies, he was challenged by Scalia about other remedies.
"What about Congress? You really think Congress is just going to sit there while all of these disastrous consequences ensue," Scalia asked the solicitor general.
"Well, this Congress, your honor, I, I," Verrilli stammered, as the chamber erupted in laughter.
"You know, I mean, of course, theoretically, of course, theoretically they could."
The high court is expected to issue a ruling by late June.
John Commins is a content specialist and online news editor for HealthLeaders, a Simplify Compliance brand.