It's on! HHS boss to attend Obamacare court fight

Health and Human Services Secretary Sylvia Matthews Burwell
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Health and Human Services Secretary Sylvia Matthews Burwell

Go ahead and say it to her face—she dares you.

The woman in charge of overseeing Obamacare will be in the gallery at the Supreme Court for oral arguments Wednesday morning, in a case that threatens to unravel the landmark health-care reform law, sources told CNBC.

Health and Human Services Secretary Sylvia Burwell's planned attendance at the high court underscores just how big of a danger the case known as King v. Burwell is for the goals of the Affordable Care Act. It is unusual, to say the least, for a cabinet-level official to attend Supreme Court arguments for a case related to their department.

Plaintiffs in the case claim that tens of billions of dollars earmarked to help more than 7 million people buy Obamacare health insurance plans this year is illegal because it is issued for plans sold on the federally run HealthCare.gov exchange. That marketplace serves 37 states.

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The plaintiffs argue that the Affordable Care Act, as written, only allows such federal subsidies, or tax credits, to be awarded to customers of an exchange run by an individual state.

Burwell and the Obama administration have scoffed at that argument, saying the subsidies were meant to be available to people across the U.S., regardless of whether they bought plans on a federal or state marketplace. The subsidies, which often greatly reduce the cost of insurance to customers, are available to people with low or moderate incomes.

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In a recent report, The Urban Institute said that if the Supreme Court invalidates the HealthCare.gov subsidies, there would be 8.2 million more uninsured people in the U.S. next year. That report also said that the average annual premium for nongroup health plans in HealthCare.gov states would rise by an average of 35 percent, or from $4,130 to $5,590.

The increase in the number of uninsured people would stem from the fact that many current Obamacare customers would find their plans unaffordable. The rise in premiums reflects the expectation that insurers would be left with risk pools from a disproportionate number of older and sicker customers, once healthier and younger customers fled the plans.

The Supreme Court is expected to rule on the case by late June.