On June 25, the U.S. Supreme Court ruled in a 6-3 decision that consumers who purchase health insurance in "federally facilitated exchanges" established under the Affordable Care Act (ACA) can continue receiving subsidies. The Court’s opinion in the highly anticipated case, King v. Burwell, was written by Chief Justice John Roberts, who also wrote the 2012 opinion upholding the ACA’s individual mandate as a valid exercise of Congress’s taxing power.
The King v. Burwell plaintiffs had argued that those who purchase insurance in the 34 exchanges operated for states by the federal government should be ineligible to receive tax credits intended for insurance purchased on exchanges “established by the state," in the words of the ACA. The Court found that this language is "properly viewed as ambiguous," but that the ACA’s "context and structure compel the conclusion that [the ACA] allows tax credits for insurance purchased on any Exchange created under the Act," whether operated by a state or by the federal government.
Almost 6.5 million people have purchased insurance on federally operated exchanges thus far. Had the Court invalidated subsidies for these purchases based on the ambiguous language, quick Congressional action - by no means guaranteed - would likely have been necessary to avoid (in the Court’s words) "destabiliz[ing] the individual insurance market in any State with a Federal Exchange," because the ACA’s goal of making insurance affordable for all is highly dependent on the availability of subsidies.