Under a case known as Pennhurst, Congress can only place conditions and burdens on states—such as a requirement that they establish their own exchange or risk a death spiral—if the states are aware of them. Twenty-two states argued in an amicus brief that they never knew the decision of whether to run their own exchanges would have such dire consequences.
In this exchange, Justice Alito asks whether the states have really been harmed. Couldn’t the Court rule in favor of the plaintiffs, but delay the ruling by six months to give states time to respond? Solicitor General Verrilli replies by explaining how big of a burden it is for a state to establish its own exchange.