Will Justice Kennedy save Obamacare?

Justice Anthony Kennedy was furious when a majority on the U.S. Supreme Court upheld President Barack Obama’s healthcare law. As he read the dissenting opinion from the bench three years ago, his anger was palpable. The majority regards its opinion “as judicial modesty,” he declared. “It is not. It amounts instead to a vast judicial over-reaching.”

That was Kennedy on June 28, 2012.

Now, as the country awaits a ruling in the second major challenge to Obama’s signature Affordable Care Act, a question is whether the justice who was the voice of the opposition then could provide the critical fifth vote to uphold the law on the nine-justice court now.

At stake are the tax-credit subsidies that have helped low- and moderate-income Americans obtain health insurance. The challengers say the government unlawfully extended those subsidies to states that did not create local insurance exchanges but instead relied on the federal exchange. If the court strikes down the subsidies, millions of Americans in at least 34 of the 50 states could lose coverage.

Five years after its passage, the Affordable Care Act has become ingrained in American life even as it remains politically divisive. “This is now part of the fabric of how we care for one another,” Obama, a Democrat, declared in a speech last week. Republicans have called for repeal and among the related lawsuits simmering in lower courts is a dispute brought by Republicans in the U.S. House of Representatives over Treasury Department payments to healthcare insurers.

IMPOSSIBLE TO PREDICT

In the case before the court, the unique issue along with Kennedy’s record and his comments in oral arguments raise the possibility he will join the four liberal justices to endorse the law. Three years ago, his fellow conservative Chief Justice John Roberts cast the swing vote with the liberals to uphold the law. It marked a rare episode when Kennedy, the usual key justice on this divided bench, did not control the outcome of a momentous case.

It is impossible to predict with confidence how the court will resolve the case, King v. Burwell. A ruling is anxiously awaited by officials in Washington and the insurance and healthcare industries nationwide.

What is known: Two days after the March 4 oral arguments this year, the justices, per their usual practice, took a vote in a small conference room off Chief Justice Roberts’ chambers. The most senior justice on the winning side then assigned the opinion for those in the majority; the senior justice on the dissenting side tapped a writer for the main dissent. Drafts of dueling opinions began circulating among the chambers.

In this conversation through memos, the justices will sharpen their arguments, sometimes compromising in reasoning and rhetoric to keep a majority together. Those in dissent similarly hone their retorts. The process is shrouded in secrecy, and the public will only know who is writing which opinion when they are issued.

For King v. Burwell, the decision could come down as soon as Monday morning, when the justices next take the bench. It is more likely to be issued later this month. The toughest disputes tend to be resolved right up against the traditional end-of-June deadline for the court’s nine-month session. Among the 20 awaited cases is also the question of whether the U.S. Constitution guarantees a right to same-sex marriage.

A PIVOTAL POSITION

On healthcare, either Kennedy or Roberts could tip the balance. Yet the 78-year-old Kennedy, appointed to the bench in 1988 by Republican President Ronald Reagan, may be in a more pivotal position based on his respect for state sovereignty and concern for the practical consequences of a decision.

While the 2012 dispute posed a broad-ranging constitutional challenge to the individual insurance mandate before it even took effect, this one turns on a mere four-word clause allowing tax credits for insurance purchased through exchanges “established by the state.”

The challengers, libertarian lawyers who were among those who lodged the 2012 attack, say that means that the subsidies are not available to people who have bought insurance through federally facilitated exchanges, which vastly outnumber state-run exchanges. The Obama administration contends the law, taken as a whole, makes clear that Congress, when it passed the law, intended the subsidies to apply to all exchanges.

During oral arguments Justice Kennedy suggested the challengers’ view of the law could put unconstitutional federal pressure on states, because if they failed to set up exchanges, they would lose subsidies: “The states are being told either create your own exchange or we’ll send your insurance market into a death spiral,” he said.

Kennedy also does not rigidly interpret the words of a statute. He considers how a decision may play out, and he noted that if “people pay mandated taxes” and are denied tax credits, “the cost of insurance will be sky-high.”

Still, Kennedy may harbor skepticism about the law known as Obamacare, and he acknowledged during arguments the possibility that the challengers could “prevail on the plain words of the statute.”
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