The moment the Affordable Care Act was enacted in 2010, it became a litigation magnet. The lawsuits threatening to derail it were initially dismissed as ridiculous but became deadly serious by the time Chief Justice John Roberts’s decisive fifth vote two years later barely upheld the law’s individual mandate, while the Court’s decisive 7-2 vote left the health law’s Medicaid expansion in tatters.
Last month, the court struck a second blow to the ACA by allowing some for-profit corporations to opt out of offering contraceptive coverage they deemed religiously offensive. And even House Speaker John Boehner is joining in the litigation, using the administration’s efforts to make the law more palatable by delaying implementation of one of its provisions as the centerpiece of his threatened lawsuit against the president.
But while Boehner’s empty threat makes headlines, a far more serious threat could deliver the death blow that the law’s opponents have been seeking. This new round of litigation attacks the health insurance exchanges at the heart of Obamacare. Congress designed the exchanges as markets to offer new, comprehensive, and often-subsidized insurance options to supplement the private market. The exchanges are the law’s linchpin — its primary means of making quality insurance affordable for millions of Americans.
The ACA required each state to “establish” an “American Health Benefit Exchange” by Jan. 1. If a state didn’t do so, the Department of Health and Human Services would step in to set up and run the exchange on the state’s behalf. The ACA treats exchanges run by HHS the same as those run by the states themselves. That’s crucial, because 36 states have deferred to HHS to set up their exchanges.
Opponents claim that the 36 states where HHS has set up and operated an exchange don’t have “state-established exchanges” at all. They argue that those states instead have “federally established” exchanges, even though that language appears nowhere in the law.
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