Corporate Accountability

Obamacare challenge could ripple in state

By Kimberly Atkins

 

WASHINGTON, D.C. — The second potentially fatal legal challenge to Obamacare takes center stage in the chamber of the U.S. Supreme Court today, and it’s filled with drama, plot twists and political 
intrigue that belie the 
rather dry and technical legal issue the justices will have to decide.

 

Despite the potential theatrics and colorful players — including MIT economist, recently ousted Health Connector board member and foot-in-mouth artist Jonathan Gruber — the case is no comedy. It could strip 8 million people of health care coverage in the 36 states that refused 
to set up health care 
exchanges, and have a negative ripple effect in the states with exchanges, 
including Massachusetts.

 

The legal issue itself is fairly straightforward: The justices must look at the language of the law and decide if it entitles those 
who signed up on the 
federal exchange to receive 
income-based subsidies, or if that benefit is 
authorized only for those who signed up on state-run 
exchanges.

 

That won’t make deciding the case easy for the justices, who must today wade through a flurry of arguments, including the claim by the law’s challengers that comments made in 2012 by Gruber prove that the federal subsidies are illegal. Gruber, long credited to be an Obamacare architect, said the law was designed to “squeeze the states” into running their own exchanges rather than relying on the federal exchange.

 

Though Gruber is cited more than 100 times in court briefs, he may now be little more than a subplot.

 

“I don’t think anyone will ask a question” about Gruber, said Peter Marathas, a partner in the Boston office of law firm Proskauer Rose.

 

Simon Lazarus of the Constitutional Accountability Center, co-author of an amicus brief supporting the government’s position, called the Gruber argument “laughable.”

 

But the impact on the Bay State may be far less funny. When I asked Gov. Charlie Baker last week about a decision that kills federal subsidies, he said it “won’t impact” Massachusetts 
because the state exchange will survive even the death of Obamacare.

 

But Marathas said Bay State businesses could feel the pinch if other states are freed of the federal law’s regulations.

 

“If you’re in Texas or Oklahoma, you’ll say: ‘Come over here, we’re an Obamacare-free state!’” Marathas said.

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