The most accurate predictor of Supreme Court decisions in the world is a gentleman named Jacob Berlove. He just put up his prediction for King v. Burwell this afternoon: 6-3 that the ACA subsidies will be upheld. His prediction is the exact same prediction I made.
In more detail: Kennedy doesn’t like the notion that the federal government would compel states to set up their own exchanges or lose subsidies. Roberts will probably agree.
Alito/Scalia/Thomas would probably argue that the moon is made out of green cheese if they thought it would hurt Obama; Sotomayor/Breyer/Kagan/Ginsberg will, of course, vote to uphold Obamacare.
I describe why this prediction looks logical under the fold.
Why I made this prediction
The government (and, by extension the ACA subsidies) will not win because of the “Pennhurst doctrine” (which I call Vogon Logic in a previous blog), but because the swing votes feel that not giving subsidies to states without exchanges would be an unconstitutional threat.
The thinking is this: If the law really told states “Set up an exchange or we will not give you subsidies”, this would be tantamount to putting a gun to their head and saying “you must set up an exchange.” Having this kind of threat in the ACA is an overreach for the federal government.
Here is the relevant part of the exchange. First, justice Sotomayor (an Obama appointee) gives the plaintiff some hard questioning:
JUSTICE SOTOMAYOR: That was the choice. If we read it the way you’re saying, then we’re going to read a statute as intruding on the Federal-State relationship, because then the States are going to be coerced into establishing their own Exchanges.
[...]
Tell me how that is not coercive in an unconstitutional way?
As the plaintiff was trying to answer the question, Kennedy — a key swing vote — chips in to support Sotomayor:
JUSTICE KENNEDY: Let me say that from the standpoint of the dynamics of Federalism, it does seem to me that there is something very powerful to the point that if your argument is accepted, the States are being told either create your own Exchange, or we’ll send your insurance market into a death spiral. We’ll have people pay mandated taxes which will not get any credit on — on the subsidies. The cost of insurance will be sky-high, but this is not coercion. It seems to me that under your argument, perhaps you will prevail in the plain words of the statute, there’s a serious constitutional problem if we adopt your argument.
When Kennedy’s line made it to the press,
stock prices for medical stocks surged, and with good reason.
It indicates that Kennedy appears to be willing to reject the plaintiff’s arguments in King v. Burwell based on constitutional principles. I can see why Kennedy thinks this way. It satisfies progressives like myself because the court does not whittle away at our universal health care system. It satisfies the conservative federalist principle of upholding states rights. It satisfies business interests because the medical industry in states without exchanges do not have the rug pulled from under them. And, finally, it allows Kennedy to wax about constitutional principles and overreaching federal power in a case that would otherwise be a mere discussion of statutory interpretation.
I can understand why Verrilli, the lawyer defending the ACA (Obamacare), doesn’t fully support Kennedy’s reasoning. As a lawyer for the United States government, he is not about to support a line of reasoning that reduces federal power.
It’s obvious Roberts doesn’t want to use the Chevron deference to save the ACA. My sense when I was reading the transcript of the oral arguments is that Roberts does not want to make a court decision that expands federal and executive powers. He will probably concur with Kennedy.