Reading the tea leaves: SCOTUS hears King v. Burwell

Editor’s note: Henry Aaron attended the Supreme Court’s King v. Burwell oral arguments on March 4 and wrote this post detailing his thoughts on the court’s proceedings.

Now the wait—and the guessing game—begins. The Supreme Court heard oral arguments this morning on King v. Burwell, the case challenging the power of the federal government to pay tax credits to low- and middle-income families under the Affordable Care Act. The core issue is now well known. The law states that tax credits can be paid to qualified applicants for insurance from ‘an exchange established by a state.’  Do those words mean that tax credits cannot be paid in exchanges organized by the federal government for the states?  No, say the plaintiffs; read the law. Yes, says the government; the law makes clear that the federal government is acting for the states not instead of them, and the law would make no sense under any other interpretation.

The Court will meet in conference on Friday, at which time a preliminary vote on the case may be taken. After that vote, opinion writing will begin. The decision will be announced, probably in late June. Between now and then, negotiations among the justices on opinions may well occur. Meanwhile, those who heard or read the arguments will parse the questions of the justices for hints on a final vote.

The oral arguments largely repeated positions already presented in briefs by the parties and in dozens of amicus briefs by outside parties. But several aspects of the oral arguments are noteworthy.

The first was the prominence of an issue not even raised in the written briefs. Do the plaintiffs have standing to challenge the law?  Before plaintiff’s attorney, Michael Carvin, had spoken five words, Justice Ruth Bader Ginsburg interrupted him. Do the plaintiffs have anything at stake in this case?  In an inconclusive exchange with Carvin, she suggested that some or all of them do not. Later, Solicitor General, Donald Verrilli, acting not as advocate for the government, but in his role as adviser to the Court, asserted that the question boils down to whether all four of the plaintiffs had enough income in 2014 so that they would not have been eligible to tax credits. If so, the case would be moot. The justices will have to decide whether the matter of standing can be raised at this point and, if so, whether evidence regarding actual income can be introduced and by whom.

This technical issue is important. If the plaintiffs are found to lack standing or if the matter is in doubt, this issue could excuse the justices from deciding the substantive issue at this time.

The second striking element came from Justice Anthony Kennedy. He invoked the Court’s decision three years ago in the first case on the Affordable Care Act. In that decision, the Court found that requiring states to expand Medicaid was an excessive and unconstitutional use of federal power to force state action. Under that doctrine, Justice Kennedy asked, would it not also be excessive and unconstitutional if the federal government threatened the states with the chaotic results that would ensue if tax credits cannot be paid through federally managed exchanges?  In that event, the states would be confronted with a choice between setting up exchanges themselves, or seeing their insurance markets collapse.

In the manner of old-style Kremlinologists, Supreme Court observers will study what the justices said or didn’t say in order to infer their position:

They will note that Chief Justice Roberts was uncustomarily silent. He asked no substantive questions of either the plaintiffs or the government. Whether this Clarence-Thomas-like silence signals that he has made up his mind, that he is preserving his options, or nothing at all is quite unclear. The outcome of the case may hinge on the answer to that question.

Justices Alito and Scalia signaled that they found persuasive the plaintiff’s position that tax credits could not be paid in exchanges organized by the federal government. In response to the assertion by Solicitor General Verrilli that under such an interpretation the rest of the law would make no sense, Justice Scalia archly observed that senseless laws were not unusual and that if the results of the plaintiff’s interpretation were as bad as the government claimed, then Congress could change the law or the states could set up exchanges. Alito said that the Court could delay the effect of a ruling to give them time to do just that.

The four liberal justices each indicated that they thought that the plaintiffs’ argument would make a mockery of the clear purpose of the Affordable Care Act and would lead to absurd internal contradictions in the law.

The wait—and the guessing game—begins. Hints gleaned from oral arguments are notoriously unreliable and (let’s face it) pointless. So, in full awareness that such guesses are close to fatuous, here is mine: the government prevails, 6 to 3. The four liberals, Breyer, Ginsburg, Kagan, Sotomayor, will be joined in concurring opinions by Kennedy and Roberts. Alito, Scalia, and Thomas will dissent emphatically and, if Justice Scalia writes the dissent, acerbically.