by Adam Winkler, Professor of Law at the UCLA School of Law.
During oral argument in the Fair Housing Act case this past week, Justice Antonin Scalia explained how another high-profile case coming later this term—King v. Burwell—ought to be decided. The King case involves the latest challenge to the Affordable Care Act. The challengers argue that the ACA does not authorize tax credits for people purchasing insurance on exchanges set up by the federal government rather than the states. They rely on a provision in the law that says such credits are available for insurance bought “through an Exchange established by the State.” Read in isolation, that provision would seem to suggest that the credits are available only on the 14 exchanges run by the states, not in the 36 states with exchanges run by the federal government.
In the hearing in the Fair Housing Act case, however, Justice Scalia—whose vote is almost certainly necessary for the ACA challengers to win their case—elucidated why the ACA challengers should lose. The Court’s obligation in interpreting a statute, Scalia said, is to “look at the entire law,” not just “each little piece” in isolation. “We have to make sense of the law as a whole,” Scalia insisted. Whether or not something is allowed by a statute can only be determined “when all parts are read together.”
Anyone who reads the “whole law” in the ACA case would easily conclude that credits are available on the federally run exchanges. Start with the basic objectives of the law. According to the authors of the law, “The Affordable Care Act was designed to make health-care coverage affordable for all Americans, regardless of the state they live in. Providing financial help to low- and moderate-income Americans was the measure’s key method of making insurance premiums affordable.” That basic goal would be completely undermined if federally run exchanges couldn't offer the tax credits.