The ACA requires individuals to purchase insurance or face a tax penalty. However, if the cost of insurance is too high compared to an individual’s income, the penalty is waived. The subsidies at issue here keep insurance affordable and the individual mandate effective.
King v. Burwell was brought on behalf of four plaintiffs who claimed they were subject to the individual mandate, and forced to purchase insurance on the exchange, because the subsidies kept their insurance costs low. However, reports surfaced prior to oral argument that these claims were untrue—that two of the plaintiffs were eligible for free insurance because they were veterans, that one plaintiff was eligible for Medicaid, and that the last plaintiff had a low enough income to have the mandate waived.
Justice Ginsburg began oral argument by bringing up the reports. If the Court were to find that all the plaintiffs had access to free insurance or were exempt from the individual mandate, the case would be dismissed. That’s because federal courts can only hear cases where the plaintiffs have standing, meaning they’ve suffered an actual injury that can be remedied by the court.