I’ve been asked a lot recently what I think of the Supreme Court’s decision to take up King v. Burwell, one of the legal challenges to the IRS’s decision to allow tax credits and subsidies to be applied to federal insurance exchanges, even though the text of the law seems to indicate that they’re only allowed on exchanges established by the states. I think the chances are high that the administration will lose because:

1. The plain text of the statute denies subsidies to people who live in states without an exchange. This reading is not absurd, because it creates a powerful incentive for states to create an exchange in the first place. The obvious meaning of the text should only be discarded if it creates absurd or ridiculous results. We shouldn’t discount the possibility that the Justices just want to do the right thing!