1. As usual, it (probably) comes down to Justice Anthony Kennedy. I have to say that I was pleasantly surprised by the thrust of his early questioning, which was based on a rather subtle point that did not feature prominently in the argumentation below but did surface powerfully in several amicus briefs. The point is about federalism and unlawful coercion being applied by the federal government against the states, and it undoubtedly appeals strongly to Kennedy, who considers himself a champion of federalism. Justice Kennedy's question was this: if government subsidies are held to be unavailable to tens of millions of Americans on the federal exchange, would this extremely pinched and hyperliteralist interpretation itself constitute a form of unconstitutional coercion imposed by Congress against the states? In other words, by forcing states to choose between creating their own exchanges or seeing their health insurance markets collapse, Congress would be imposing a coercive, unconstitutional condition on the states. As Justice Kennedy put it, "if petitioners' argument is correct, this is just not a rational choice for the states to make and ... they're being coerced."
The logic of this line of questioning is that, under the canon of "constitutional avoidance," the Supreme Court should avoid an extremely literalistic and counterintuitive construction of the statutory phrase at the heart of the case ("an Exchange established by a State") because it will lead to a harsh and likely unconstitutional result. Far better to avoid a constitutional collision and interpret the phrase in the entire context of the statute, whose purpose is obviously to make the ACA subsidies available to everyone who signs up under the exchanges, whether state or federal. Solicitor General Don Verrilli took the opportunity to endorse the "avoidance canon" and refocus the court's attention on the entire context of the statutory scheme, which was the essential burden of his argument.
But it's not all about Justice Kennedy, because...
2. Chief Justice John Roberts was unusually subdued, and he could conceivably surprise everyone by voting to uphold the statute. If that happens, it'll be both because the correct interpretive methodology is so commonplace and obvious and because the politics are actually all wrong for the Republicans. Millions of Americans have gotten health insurance under the ACA -- that was the whole point, remember? -- and a ruling for the petitioners would throw all the dishes and spaghetti and silverware in the air. The result would be chaos. Again, if they get their way here, right-wingers determined to destroy Obamacare will be their own worst enemy, because the country wants, if anything, a more -- not less -- comprehensive approach to delivering health care to America.
3. As a matter of statutory construction, this is a very straightforward case. This point was made beautifully clear by Professor -- excuse me, Justice -- Elena Kagan, who did us all the favor of coming up with a well-polished hypothetical posed to the able Michael Carvin, attorney for the petitioners, that demonstrated the fallacy of this latest right-wing hit on the ACA. Kagan's hypothetical case (imagine a world without hypotheticals!) made the point that all text has context, and that specific instructions need to be read as part of an overall program and direction. As she put it to Mr. Carvin, whom she expertly snared in her net, "what you're saying is that the answer to the question really does depend on context, and it depends on an understanding of the law as a whole...."
4. Solicitor General Don Verrilli did a superbly resilient job. During his arguments the solicitor general was required to fend off a barrage of attacks from Justices Samuel Alito and Antonin Scalia, and he did so with aplomb. Justice Scalia insisted in every possible way that the contested phrase be read in pristine isolation and without any reference to how the whole statutory regime works. Justice Alito advanced the baffling argument that the statute still makes sense even without subsidies to people on federal exchanges, although no one else in the country can figure out what that sense is. The bottom line is that the petitioners are promoting a purely absurdist interpretation of the ACA! Meanwhile, Justice Scalia, ever the nihilist, bet the farm on reading the magic four words in a completely literalist way, rejecting the relevance of the rest of the statute, despite every major canon of statutory construction that calls for contextual understanding and other statements he has himself made in favor of a comprehensive statutory reading.
5. This argument makes clear how important it is to have the right Justices on the Supreme Court. It's not just for the big-forest constitutional questions but for the in-the-trees statutory questions where a lot of our law is made, and where all of us have a very important stake.
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