Supreme Court of United States– Giving a landmark judgment, the Court by a majority of 6:3 sealed the fate of the Patient Protection and Affordable Care Act, 124 Stat. 119 by upholding that the Act widely known as Obamacare, did not restrict the subsidies to States that establish their own online healthcare exchanges but extends them to States that have a Federal Exchange also. The issue in the present case was whether the Act’s interlocking reforms apply equally in each State no matter who establishes the State’s Exchange or whether the tax credits are available in States that have a Federal Exchange.
The Patient Protection and Affordable Care Act adopts a series of interlocking reforms designed to expand coverage in the individual health insurance market. First, the Act bars insurers from taking a person’s health into account when deciding whether to sell health insurance or how much to charge. Second, the Act generally requires each person to maintain insurance coverage or make a payment to the Internal Revenue Service. And third, the Act gives tax credits to certain people to make insurance more affordable. In addition to those reforms, the Act requires the creation of an “Exchange” in each State basically, a marketplace that allows people to compare and purchase insurance plans. The Act gives each State the opportunity to establish its own Exchange, but provides that the Federal Government will establish the Exchange if the State does not. Also, the Act provides that tax credits “shall be allowed” for any “applicable taxpayer,” 26 U. S. C. §36B(a), but only if the taxpayer has enrolled in an insurance plan through “an Exchange established by the State under 42 U. S. C. §18031,” §§36B(b)(c).
The Court observed while interpreting the phrase “an Exchange established by the State under 42 U. S. C. §18031” that oftentimes the meaning or ambiguity of certain words or phrases may only become evident when placed in context, hence the phrase may be limited in its reach to State Exchanges but it could also refer to all Exchanges both State and Federal for purposes of the tax credits. Roberts CJ, giving the opinion of the Court stated that although the petitioner’s arguments about the plain meaning of the statute were “strong”, the context and structure of the act compel to depart from what would otherwise be the most natural reading of the pertinent statutory phrase. King v. Burwell, 576 U. S. ____ (2015), decided on 25.06.2015