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Obamacare's federal subsidies case heading for high court showdown

By RUTH MARCUS Washington Post Writers Group

WASHINGTON - Don't be so sure the Supreme Court is going to save Obamacare. Again.

The question is enormously important: Are health care consumers entitled to subsidies if they buy coverage on insurance exchanges established by the federal government, as they are from state exchanges?

Two federal appeals courts have reached contradictory conclusions - at least so far. (The Obama administration plans to ask the full federal appeals court for the District of Columbia Circuit to review the three-judge panel ruling against the subsidies, and that court is newly stocked with liberals.) Cases are headed to two other appeals courts.

Which adds up to: coming eventually to a Supreme Court near you. The justices, particularly Chief Justice John Roberts, might prefer to duck the case - who needs the court embroiled in another Obamacare dispute? - but this might not be a realistic option.

The dispute involves perhaps the most consequential case of sloppy bill-drafting in congressional history. The section of the law outlining how subsidies are calculated refers specifically to an exchange "established by the state." It doesn't mention subsidies for the federal exchanges set up in those states (now 36) that opted not to establish their own.

Preventing federal exchanges from offering subsidies would cripple the law, driving up premiums as healthy enrollees drop coverage and sicker ones remain. It is implausible to think that a Congress that created federal exchanges as a back-up alternative to state marketplaces also intended them to fail. Yet the legislative language, taken alone, implies that outcome.

As the Richmond-based 4th Circuit Court of Appeals conceded even as it upheld the subsidies, "If Congress did in fact intend to make the tax credits available to consumers on both state and federal exchanges, it would have been easy to write in broader language, as it did in other places in the statute."

Nonetheless, the stronger legal argument is with the government. In context - and even Justice Antonin Scalia, the ultimate textualist, believes in looking at laws this way - it's clear Congress could not have meant the provision to be so narrowly construed.

As you may have noticed, the stronger legal argument doesn't always win at this Supreme Court. The four liberal justices are reliable votes in the government's favor. Where is the fifth? Justice Anthony Kennedy believes the Affordable Care Act is unconstitutional, but he might be moved by the plight of millions of people suddenly without affordable insurance.

A more likely candidate is Roberts, who has already rewritten the statute once in order to save it, in the 2012 ruling upholding the constitutionality of the individual mandate because it was a tax, not a penalty. Would he ride again to Obamacare's rescue - not because he cares a whit about the law but to protect the court's reputation?

Some smart people think so. "A major lesson to be learned from the court's previous decision ... is that a majority of the justices do not want to determine the fate of a hugely important social issue," Supreme Court super-litigator Tom Goldstein wrote for ScotusBlog.

Ezra Klein of Vox agreed: "The Supreme Court simply isn't going to rip insurance from tens of millions of people in order to teach Congress a lesson about grammar."

Let's hope they're right, but I have my doubts. Certainly, Roberts zealously guards the court's institutional standing against accusations of overreaching. But only to a point. The Voting Rights Act offers an example. In 2009, Roberts, as with the Affordable Care Act, demonstrated his willingness to stretch the language of the statute in order to save it - temporarily. Four years later, he wrote the majority ruling striking down the law's key provision.

Importantly, Roberts' initial restraint in that case, as in his ruling upholding the Affordable Care Act, was based on constitutional considerations: the long-standing principle that the court, if possible, should avoid overturning the work of a coequal branch of government.

In the looming case about federal subsidies, which involves statutory interpretation (actually, whether the court should accept a federal agency's interpretation of a statute), Roberts may be inclined to a less deferential stance.

Indeed, the two D.C. Circuit judges who invalidated the subsidies - Thomas Griffith and Raymond Randolph - cast their decision in terms of the "legislative supremacy" of Congress and the need for judges to respect statutory language, not substitute their own judgment about what Congress intended.

Last time around, Roberts was protecting the court from appearing to overstep its constitutional muscle. This case is different, and so, I fear, could be the outcome.

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