Wash U Expert: Supreme Court case against Affordable Care Act has no merit

McBride, noted health economist, says scholars have cast serious doubt on logic of the case

The U.S. Supreme Court has agreed to hear a lawsuit targeting federal subsidies designed to help millions of Americans afford health insurance.


The case is dubious on its merits, said Timothy D. McBride, PhD, professor at Washington University in St. Louis’ Brown School and a noted health economist. McBride cites legal precedent as a reason for allowing the subsidies to continue.

At stake in the lawsuit is whether subsidies should be available to anyone who qualifies, or only to those who purchase insurance through exchanges established by the states.

“The Supreme Court has decided to take a case, ruling on another aspect of the legality of a key provision of the Affordable Care Act (ACA), whether it is legal for the federal government to provide subsidies for insurance coverage under the federal marketplaces,” McBride wrote on his blog.

“Though nearly every scholar has cast serious doubt on the logic of the case made by the plaintiffs, the court has decided to take the case, likely because at least four justices have certainly expressed their strong skepticism on the ACA,” wrote McBride, a scholar in the university’s Institute for Public Health.

The case is dubious on its merits, McBride wrote, as the Fourth Circuit of the U.S. Court of Appeals ruled, when it rejected the case in a case called King v. Burwell.

“That court concluded that the Internal Revenue Service, in the regulations it wrote to implement the subsidy provisions is a ‘permissible construction of the legislative language’ because ‘the widely available tax credits are essential to fulfilling the ACA’s primary goals and that Congress was aware of their importance when drafting the bill.'”

Tellingly, and perhaps most revealing, McBride wrote, the plaintiffs do not dispute that the premium tax credits are an essential component of the ACA’s viability.

“They ‘concede that Congress probably wanted to make subsidies available throughout the country,'” McBride wrote. “This seems to create a Catch-22 for the plaintiffs in the case in front of the court, because by making their claim that they know that invalidating the premium subsides will gut the ACA, that perhaps inadvertently guts their case.”

For more of McBride’s views on this lawsuit, which is expected to be decided in June 2015, visit his blog.