New York Times

WASHINGTON — When the Supreme Court on Friday agreed to hear a new challenge to the Affordable Care Act, it caused concern for many people who support the law, which has provided health insurance to more than 10 million. The challenge poses a threat to the law, according to defenders of President Obama’s policies.

In 2012, Chief Justice John G. Roberts Jr. sided with the more liberal justices in upholding a central provision of the law, which requires most Americans to have health insurance or pay a tax. The latest case, King v. Burwell, involves another provision of the law, which offers federal subsidies to help people buy insurance that many would otherwise be unable to afford. Here are preliminary answers to some of the many questions raised by the Supreme Court’s action.

Q. What is this case about?

A. The plaintiffs, residents of Virginia, are challenging the government’s authority to pay premium subsidies there. Virginia is one of three dozen states in which federal officials operate a public marketplace, or exchange, for the sale of insurance under the Affordable Care Act. Under a literal reading of the law, they say, subsidies are available only in states that established their own exchanges. The law, they note, authorized subsidies specifically for insurance bought on “an exchange established by the state.” By contrast, the White House and its allies argue that Congress intended to make the subsidies available in all states. And some judges have agreed. “The plain text of the statute, the statutory structure and the statutory purpose make clear that Congress intended to make premium tax credits available on both state-run and federally facilitated exchanges,” said Judge Paul L. Friedman of the Federal District Court here. In January, he rejected a legal challenge to the subsidies in a separate case involving the same legal issue.

Q. What happens to people who are receiving subsidies?

A. For the time being, they will continue to receive the financial assistance. If the Supreme Court eventually rules for the plaintiffs, millions of people could lose the subsidies. If the court rules for the federal government, nothing would change.

Q. Why are the subsidies important?

A. For people who obtained insurance through the exchanges this year, subsidies reduced the average premium by more than 75 percent — to $82 a month, from $346. About four-fifths of the people buying insurance on the exchange qualified for subsidies this year. Subsidies were available on a sliding scale to people with annual incomes up to $45,960 for individuals and up to $94,200 for a family of four. If the court blocks payment of subsidies through the federal exchange, the ruling could cut off financial assistance for 4.5 million people. However, lawyers say, it is highly unlikely that people would have to pay back subsidies.

Q. How do the subsidies fit into the health care law?

A. The subsidies are a central element of the law. Without them, many more consumers would be unable to afford coverage and could then be exempted from the requirement to have insurance — the “individual mandate.” If the court blocks payment of the subsidies, it could undercut enforcement of another provision of the law, which requires larger employers to offer coverage to their full-time employees. This requirement is enforced through penalties imposed on employers if any of their workers receive subsidies. The employer mandate could become meaningless in states where subsidies were unavailable.

Q. Why did Congress allow this legal tangle to develop?

A. The health care law, in its current form, was written mainly by Senate Democrats. They assumed that states would set up and run their own exchanges. After President Obama signed the law in March 2010, the politics of health care became more intense. Many Republican governors and state legislators decided that they did not want to establish exchanges and left the task to the federal government. Architects of the health care law — leading Democrats in Congress — say they assumed that insurance subsidies would be available in all states. But critics of the law offer a different version of the legislative history. Congress, they say, wanted to use the subsidies as an incentive for states to establish exchanges, so it provided subsidies only for states that did so. To support their case, critics cite comments made by Jonathan Gruber, a professor of economics at M.I.T. who had been an adviser to the Obama administration on health policy. At a conference in 2012, Mr. Gruber said the federal government would provide a backstop if states failed to establish insurance exchanges. “What’s important to remember politically about this,” Mr. Gruber said, “is if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits.” Mr. Gruber has backed away from those comments, saying he “made a mistake.” The only sensible reading of the law, he said in July, is that tax credits are available in all states.

Q. Is this all about politics?

A. The Obama administration describes the court challenge as part of a larger strategy by conservatives to eviscerate the law. They note that lawyers for plaintiffs in the Supreme Court case have also been involved in other challenges to the law. Many Republicans want to repeal the law or dismantle it piece by piece. “Obamacare is hurting our economy, it’s hurting middle-class families, and it’s hurting the ability for employers to create more jobs,” the House speaker, John A. Boehner, said Thursday. On the other hand, a legal victory for opponents of the law could be a political gift to Democrats. Republicans would have to explain why they wanted to deprive people of health insurance, and Democrats would have a powerful issue to mobilize support for the law and for their party.