Clean bill of health: Obamacare upheld by Supreme Court

A general view of the U.S. Supreme Court building in Washington. (Reuters / Carlos Barria)
The Supreme Court upheld the nationwide availability of tax subsidies crucial to the White House’s healthcare program, handing a major victory to President Obama. Six judges affirmed the verdict of a lower court in King v. Burwell, with three dissenting.

Conservative plaintiffs challenged the 2010 Affordable Care Act, commonly known as Obamacare, arguing that federal tax subsidies envisioned by the law, as written, only applied to health exchanges “established by the state.”

Chief Justice John Roberts and Justice Anthony Kennedy, both regarded as conservative, joined the court’s liberal judges Kennedy, Ginsburg, Breyer and Sotomayor in backing the government’s position on Thursday.

Although the challengers' arguments about the plain meaning of the statute were “strong,” Roberts wrote in the majority opinion, the “context and structure of the act compel us to depart from what would otherwise be the most natural reading of the pertinent statutory phrase."

"A fair reading of legislation demands a fair understanding of the legislative plan," Roberts wrote. The six judges chose to interpret the Section 36B in light of the legislators' perceived intent "to improve health insurance markets, not to destroy them."

Only 13 states have set up their own healthcare exchanges since 2010. Three other states have hybrid exchanges with the federal government, leaving with 6.4 million Americans in 34 states dependent on federal-run exchanges. They allow low and middle income people to buy private health insurances. The King v. Burwell challenge sought to declare those subsidies illegal, since the exchanges were not “established by the state”.

READ MORE: Health subsidies for millions at risk with Obamacare back before Supreme Court

It was the second time in three years that the Supreme Court upheld Obama’s healthcare reform program in face of challenges by the conservatives. In a 5-4 decision in 2012, the court ruled the Affordable Care Act’s provision mandating the purchase of health insurance amounted to a tax, and was therefore constitutional.

In a brief address to the press at 11:30 a.m. local time, President Obama hailed the decision, saying the ACA "finishes the job" begun by the introduction of Social Security and Medicare.

"The Affordable Care Act is here to stay," he said, adding that repeated legislative and judicial challenges have failed to "unravel what has now been woven into the fabric of America."

"This was a good day for America," Obama concluded. "Let's get back to work."