	Introduction

In March 2015, the Supreme Court heard oral arguments in King v. Burwell , a case addressing an important issue of implementation of the Patient Protection and Affordable Care Act (ACA). The lawsuit involves the provision of premium tax credits, which became available in 2014 and are intended to help certain individuals pay their premiums for private health insurance plans offered through insurance "exchanges" established under ACA. This report provides background on relevant provisions of ACA. It then answers questions concerning the litigation and potential implications of the Court's decision in King . The premium assistance credit amount is defined as the amount equal to the lesser of
(A) the monthly premiums for such month for 1 or more qualified health plans offered in the individual market within a State which cover the taxpayer, the taxpayer's spouse, or any dependent â¦ of the taxpayer and which were enrolled in through an exchange established by the State under 1311 of the Patient Protection and Affordable Care Act , or
(B) the excess (if any) ofâ
(i) the adjusted monthly premium for such month for the applicable second lowest cost silver plan with respect to the taxpayer, over
(ii) an amount equal to 1/12 of the product of the applicable percentage and the taxpayer's household income for the taxable year. In May 2012, the Internal Revenue Service (IRS) issued final regulations related to the premium tax credit that make the credits available to taxpayers who obtain coverage in both state and federally facilitated exchanges. As noted above, following issuance of the IRS regulations, at least four lawsuits were filed claiming the agency overstepped its authority when it interpreted the statute to allow premium tax credits to individuals participating in federally facilitated exchanges. What is that? The Court's opinion in the King case may address this scenario. Commentators have also noted that if the Supreme Court invalidates the IRS rule, this could have a debilitating effect on the federally run exchanges.
Legal challenges that may have a substantial impact on the implementation and operation of the Patient Protection and Affordable Care Act (ACA) concern whether premium tax credits are available for millions of individuals participating in federally administered health insurance exchanges. These credits, which became available in 2014, are intended to help individuals pay the premiums for private health plans offered through the insurance exchanges established under the act. In addressing who may receive this credit, ACA refers to individuals who are "enrolled in [a plan] through an exchange established by the State" under ACA. Following the issuance of IRS regulations that allow for these credits to be available in both state and federally run exchanges, lawsuits were filed claiming that the language of ACA prohibits the credits from being available to individuals who obtain coverage in federally run exchanges. The Supreme Court is currently reviewing this issue in King v. Burwell . The Court heard oral arguments in the King case on March 4, 2015, and a decision is expected by the end of the Court's term in June 2015 at the latest.
This report provides background on provisions of ACA relevant to this issue. It then answers questions concerning the legal challenges and potential implications of the Court's decision in King .