On Timing and King

by Nicholas Bagley — Friday, May 29, 2015

Since I’ve received a number of questions recently about the timing of King v. Burwell and its aftermath, I thought it was worth addressing them all in one place.

When will we get a decision?

The Court is likely to release its opinion in the last week of June. A decision could come sooner, but it probably won’t. The case was only argued in March, which is fairly late in the term, and it’s going to take time for the justices to write their opinions and to work out language with colleagues who wish to sign onto those opinions. Plus, the justices have a bunch of other opinions to write before they skip town for the summer. It’s a busy time.

When will the decision take effect?

If the government loses in King, there’s a small chance that the Court will stay its decision. If it doesn’t, however, the administration will have little choice but to comply within 25 days.

Here’s why. Per Rule 45 of the Supreme Court’s rules, an opinion takes effect 25 days after its release in any case that was appealed from a state court. King wasn’t an appeal from a state court, though. The case came from the Fourth Circuit. And Rule 45 doesn’t exactly say when a decision will take effect—in legal jargon, when the Court’s mandate will issue—with respect to the lower federal courts.

But don’t get too hung up on precisely when the mandate will issue. The executive branch’s compliance with a Supreme Court judgment is more about respecting the decision of a co-equal branch than it is about adhering to a formal judicial order. After King is decided, the Obama administration will have 25 days to consider asking the Court to rethink its decision. The administration probably won’t bother; doing so would be pointless. But after it throws in the towel, the administration couldn’t flout the Supreme Court’s decision without provoking a minor constitutional crisis.

When will people start losing coverage?

Once the administration complies with the Court’s decision, the IRS will no longer have the authority to cut subsidy checks—called “advance payment tax credits”—to insurers in 34 states. When residents in those states go on HealthCare.gov to pay their monthly premiums, perhaps on August 1, they’ll be asked to pay the full cost of their coverage.

If they don’t—and most won’t—their insurers will terminate their coverage. Those terminations will, in most states, become effective 30 days after nonpayment. Millions of people are thus likely to lose coverage by Labor Day.

There’s been some suggestion that, under the ACA, insurers must wait 90 days before terminating coverage for non-payment. But that’s wrong. The ACA does require insurers to give notice 90 days before ending a “particular type” of plan as to all enrollees. The provision does not govern, however, where an individual’s coverage is canceled for failure to pay.

Could states without their own exchanges transition state-based exchanges for 2016?

Under HHS’s current rules, states that wish to operate state-based exchanges for 2016 have to secure conditional approval by mid-June—which is to say, about two weeks from now. Needless to say, no state (with the possible exception of Pennsylvania) will hit that deadline. HHS could adjust its rules, but even if it does, open enrollment is set to begin on November 1.

States will thus have a scant four months to get new exchanges up and running. In most if not all states, that won’t be nearly enough time.

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About Nicholas Bagley

Nicholas Bagley is a Professor of Law at the University of Michigan Law School.

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