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Not So Fast, Obamacare Challengers

July 28, 2014

With two federal appeals courts issuing conflicting decisions on the availability of tax credits to those who have purchased health insurance on federally-facilitated health care exchanges under the Affordable Care Act (ACA), lots of people are assuming that Obamacare is on its way back to the Supreme Court.  They could be wrong. 

The ACA opponents in King v. Burwell, the Fourth Circuit case that upheld the IRS rule that confirms that tax credits are available to those buying insurance on federal exchanges, will almost certainly file a petition for certiorari (“a cert. petition”) asking the Supreme Court to hear the case.  But if the Supreme Court treats this like it would almost any other case, it will deny their petition.  Here’s why.

As any Supreme Court advocate knows, the most important criterion the Court considers when deciding whether to hear a case is whether there’s a division among lower courts (colloquially called “a circuit split”).  At his Supreme Court confirmation hearing, then-Judge John Roberts explained that “the clearest case that the Court should hear . . . is when two different courts of appeals are interpreting a law differently.”  Although there’s currently a split regarding the ACA given the D.C. Circuit’s decision in Halbig v. Burwell invalidating the same provision that the Fourth Circuit upheld, that could change very soon.  The government has already announced that it’s seeking a rehearing en banc, in other words asking the full D.C. Circuit to rehear Halbig.  Assuming the D.C. Circuit agrees to rehearing, the ruling of the three-judge panel opinion in Halbig will be vacated as soon as the full court announces that it will be rehearing the case.  In other words, the panel decision will no longer be on the books.  And that means there will no longer be a division among lower courts.

If this were an ordinary case, there’s virtually no question about what the Supreme Court would do with the cert. petition in King at that point.  It would either deny it outright or hold it (that is, defer making any decision) until the D.C. Circuit issued its en banc decision.  After all, not only would there be no formal Circuit split, but when the D.C. Circuit ultimately issues its en banc decision, it might well agree with the Fourth Circuit in King, making two courts of appeals that have upheld the IRS rule.  At that point, there’d be no division among the lower courts, and in an ordinary case, the Court would most likely deny the petition.

This doesn’t mean the Court won’t take King this fall before the D.C. Circuit’s had a chance to rehear Halbig (assuming that rehearing is granted).  The Court’s conservatives have time and time again shown their willingness to do things the Supreme Court doesn’t normally do—for example, addressing issues the litigants didn’t raise—in order to reach issues they want to reach and move the law radically to the right.  (So much for judges only being umpires and not active players in the game.)  But if the Justices play by the normal rules, they won’t take King now.  And might never. 

So Obamacare challengers who are hoping for a do-over in the Supreme Court should hold their horses.  The next word on the Obamacare tax credits shouldn’t be from the Supreme Court.    

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