U.S. Supreme Court Upholds Tax Subsidies for Federal Healthcare Exchanges.
On June 25, 2015, in King v. Burwell, the U.S. Supreme Court held that tax credits under the Affordable Care Act (ACA) are available to individuals who sign up for health insurance coverage on either state exchanges or on the federal exchange. The plaintiffs in the case argued that language in the ACA only made tax credits available to individuals who bought health insurance on an exchange “established by the State,” and therefore excluded anyone who bought health insurance on the federal exchange. However, in a 6-3 decision, the Court ruled that the ACA provisions describing the two types of exchanges were unclear and did not prohibit tax subsidies for people who bought coverage on the federal exchange. The Court also noted its interpretation that Congress did not intend for the viability of the ACA to turn on language in an ancillary provision.