On July 22 of this year, two federal appellate courts issued
clashing decisions within hours of each other on the meaning of a
key provision of the Patient Protection and Affordable Care Act. In
Halbig v. Burwell, the U.S. Court of Appeals for the
District of Columbia Circuit
held that the plain text of Obamacare forbids the granting of
tax credits to individuals who purchased health insurance on health
care exchanges operated by the federal government. In King v.
Burwell, the U.S. Court of Appeals for the 4th Circuit reached
the opposite conclusion, holding that while the relevant Obamacare
provision might appear to cut against the federal government, the
I.R.S. rule allowing tax credits via federal exchanges is
nonetheless entitled to the benefit of the doubt from the federal
courts. As that court
put it, “we must defer to the IRS rule.”
Both sides of the dispute promptly filed appeals. The Obama
administration, which lost Halbig, asked the D.C. Circuit
to rehear the case with a full panel of judges. The D.C. Circuit
agreed to do so. The losing side in King, meanwhile,
petitioned the Supreme Court to take up its case and overturn the
4th Circuit. On Friday (Halloween) the Supreme Court met in private
conference to decide whether or not to do so. Today the Court
issued its orders
from that conference. Yet those orders made no mention of King
v. Burwell. It was total silence. A short while later, the
Court’s
docket announced that King had been relisted for
another round of private discussion among the justices at this
Friday’s conference.
What does this mean? Why didn’t the Court simply agree to hear
or reject the case? At SCOTUSblog, Lyle Denniston
sketches four possible explanations:
First, it could mean that one or more Justices seemed to
simply want some more time to ponder the case, especially since
there is at present no split among federal appeals courts on the
subsidy question.
Second, it could mean that the case has not drawn the support of
four Justices in favor of reviewing the dispute, but that the
case was put over to see if more votes might be forthcoming.
Third, it could mean that the Justices just will not
take any action on the controversy until a split does
develop among federal appeals courts. The rescheduling
for another look this week would not seem to support that
prospect.
And, fourth, it could mean that the Court is inclined to grant
review, but is simply following in this instance its apparent new
policy of not granting any new cases the first time it examines
them at a Conference. This is a policy that emerged last
Term, to try to head off the chance that a case seemingly worthy of
review turns out not to be on closer examination.
At the Volokh Conspiracy, Case Western University law professor
Jonathan Adler, whose legal arguments have played a central role in
these two challenges to the health care law,
lays out the reasons why the Supreme Court may soon agree to
hear King v. Burwell:
The justices often like to wait and let questions “percolate.”
So whether the Court agrees to
hear King will likely depend on whether the
justices (or, more precisely, four of the justices) believe that a)
this is a question that will (or should) eventually fall on their
plate, and b) this is a question that should be
resolved sooner rather than later. …
Does King satisfy both criteria? It might.
In King there is a serious argument that
it would be better to resolve the underlying question of
statutory interpretation sooner rather than later.
The resolution of this litigation
will alter the calculus for many political and private
actors considering how to respond to the PPACA, and the statute
contains various deadlines and timeframes that may become harder to
navigate the longer this litigation drags on. Among other
things, states may wish to reconsider whether to create their own
exchanges and seek additional support grant. Some states that
created their own exchanges are planning to shift to a federal
exchange; Oregon’s transition is already underway. A victory
for the plaintiffs in King could force them to
reconsider. It might also prompt HHS to develop rules to facilitate
the state waiver process that begins in 2017. The more time
they have to do this, the easier it will be. Further, the longer
the IRS rule remains in place, the more disruptive it will be
should the Supreme Court ultimately decide that rule is
illegal, a point made by the petitioners in their briefing and
highlighted by the WSJ. Of note, it appears some insurers
are making contingency plans to prepare for the possibility that
the King or Halbig plaintiffs
prevail.
In other words, stay tuned next Monday for developments from
this Friday’s SCOTUS conference.
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