NEW MEXICO’S BUSINESS LAWYERS ®

The ACA Supreme Court Ruling: Key Things to Know

June 25, 2015

On June 25, 2015, the United States Supreme Court issued its opinion in King v. Burwell, holding that under the Affordable Care Act (ACA) tax credits are available through federal insurance exchanges to individuals buying insurance.

In reaching its holding, the Court emphasized the importance of the three major reforms required by the ACA:

  1. Implementing guaranteed issue and community rating requirements (i.e., preventing an insurance company from turning down an individual because of health conditions, or charging more because of health conditions);
  2. Requiring individuals to buy health insurance or pay a penalty unless health insurance costs exceed 8% of an individual’s income; and
  3. Providing tax credits to individuals with incomes between 100% and 400% of the federal poverty line to make health insurance more affordable.

In essence, the Court determined that preventing federal exchanges from offering tax credits to individuals buying insurance would negate many provisions of the ACA and undermine Congress’s plan to create affordable health care. Though New Mexico has a state health insurance exchange and was not going to be directly affected by the King decision, the Supreme Court has once again upheld provisions of this law, meaning that it might be here to stay.

If you need help determining how the ACA may affect your business, we invite you to call our firm’s ACA attorneys, Katharine Downey and Keith Mier, at 505-883-2500.

Skip to content