WASHINGTON (ABC/WATE) – The U.S. Supreme Court sided Thursday with the Obama administration over its major healthcare overhaul, upholding federal subsidies across the country.
The decision will have a major impact on the millions of Americans who are receiving financial assistance from the federal government to buy health insurance.
“It means a lot to them. Basically a huge peace of mind knowing that they will continue to receive the subsidies and assistance to pay for their insurance that they currently have,” said Nayeli Zarate, who signs people up for health insurance at Cherokee Health.
Obamacare — technically titled The Affordable Care Act — gave states the option to build their own healthcare marketplaces or simply use one operated by the federal government.
In all, 34 states decided to rely on the federal “exchange.” And more than 6 million low- to moderate-income Americans are now receiving subsidies of on average $260 a month through the federal exchange, according to Health and Human Services Secretary Sylvia Burwell.
But in a lawsuit challenging the law, critics insisted the federal government is not allowed to subsidize insurance in states that rejected their own exchange for the federal system. Those critics based their argument on a single phrase in Obamacare that refers only to participants enrolled “through an Exchange established by the State.”
“If subsidies are authorized for all Exchanges, why does [the law] specify an Exchange ‘established by the State’?” petitioner David King and others wrote in their brief to the Supreme Court.
The White House has maintained, though, that in drafting and passing Obamacare, Congress clearly intended to offer insurance subsidies to those participating in both the federal and state exchanges.
Last week, Burwell said the administration was “in a very strong position in the case,” based on the wording of the law and “the intention of the law.”
She warned an adverse ruling would likely mean millions of Americans would lose subsidies and be unable to afford health insurance coverage.
With only the sickest people in the insurance marketplace then, costs for coverage “drive up,” she added.
In all, at least 10.2 million Americans have signed up for health coverage through Obamacare, according to Burwell’s department.
She indicated an adverse ruling would mean governors in states without exchanges would have to decide whether to create them, and Congress would face a decision over whether to intervene through legislation.
Tennessee lawmakers’ reactions
“It’s unfortunate that the Supreme Court didn’t read the law the way that Congress wrote it. The 36 percent increase in some individual health care rates announced recently should remind Tennesseans that Obamacare was an historic mistake. It gave Americans higher health care costs while reducing our choices of health plans, doctors and hospitals. Republicans are ready to reduce the cost of health care so more people can afford it, put patients back in charge, and restore freedom and choice to the health care market,” said U.S. Sen. Lamar Alexander in a statement.
“Today’s ruling affirms that it is up to Congress to come together around a responsible solution that provides relief from the damaging effects of the president’s health care law, including policies to provide far greater choice in the marketplace so affordable plans that meet the actual needs of Tennesseans can openly and effectively compete for their business,” said U.S. Sen. Bob Corker.
“I agree with Justice Scalia that this decision is ‘quite absurd.’ While I am disappointed in the Supreme Court’s ruling, the decision today confirmed what we have said all along: Obamacare is a poorly written law that was not read by the Members of Congress who passed it. Although this is a setback, it is by no means the end of our fight. I will continue to work to repeal Obamacare and replace it with true free market healthcare reform that benefits hardworking families and businesses in East Tennessee,” said Rep. Chuck Fleischmann.
State Senator Becky Massey said Insure Tennessee could help fill the coverage gap that still exists in East Tennessee.
“For that to come back up and for it to have a chance of passing it’s going to have to be a grassroots effort. Not led from top down, not the governor calling it, but really the population of Tennessee people that it really affects are going to really have to work,” she said.
ABC News’ Nancy Gabriner contributed to this report
Photos: SCOTUS upholds Obamacare