Sunday, March 15, 2015

Obamacare at the Supreme Court - Again

(For new readers of this blog I previously put up a post entitled "Obamacare at the Supreme Court" on 4/15/12. The issue was whether or not the the requirement to purchase health insurance under the ACA could be upheld under the Commerce Clause of the U.S. Constitution. I incorrectly predicted that SCOTUS would strike down the ACA. However, C.J. John Roberts surprised many commentators by holding, with the four liberal Justices, that the failure to purchase insurance would not result in a penalty/fine being assessed (as Congress wrote); rather, he rewrote the law and called the penalty a "tax." My discussion of the Court's holding can be found in the 7/1/12 post entitled "Obamacare Upheld Under a Flimsy - and Dangerous Theory.")

Now, Obamacare was again before the Supreme Court in the case of King vs. Burwell. The issue is whether or not the subsidies provided under the ACA can be given to people who reside in states that have not set up a health insurance exchange. A total of 34 states did not in fact set up exchanges. The people in those states are eligible to enroll in the federal exchange. The issue is whether or not those people qualify for a subsidy.

The wording of the statute provides that the subsidies are available to enrollees in exchanges "established by the State." As 34 states did not establish an exchange, the argument is that the residents of those states are not entitled to the subsidy. The failure to be eligible for the subsidy, the argument goes, would result in millions being unable to afford insurance, in turn requiring insurers to charge even more for those with insurance. Ultimately, the entire system could come crashing down.

In fact, Justice Kennedy expressed such a concern during oral arguments. He questioned whether or not the statute would then be coercing the states to set up an exchange or force their state "insurance market into a death spiral." The analysis is flawed as it leaves out another option - "clean-up legislation." It happens all the time. A law is passed and the legislature realizes certain words were left out or phrased poorly. So they fix it. What Kennedy is really saying is that the Republican Congress could not be trusted to do so. Maybe not; but it's not his job to rewrite legislation in anticipation of the Congress (the body tasked with writing legislation) failing to do so.

The New York Times lead editorial of 3/1/15 discussed this issue. They called it "The Phony Legal Attack on Health Care." As usual, the Times puts their agenda ahead of the truth, starting their editorial with demagoguery and name calling. It is such a "phony" issue that the Supreme Court of the United States agreed to hear the case. Said the Times: "So it is no surprise that no one involved in passing or interpreting the law...thought that the subsidies would not be available on federal exchanges."

Really? Some of you may recall the name Jonathan Gruber. Gruber, an MIT professor, was one of the main architects of the bill. Videos surfaced a few months back in which Gruber was quoted as saying that the bill was purposely written in a "tortured way" in order to fool the American people about the fact that "healthy people pay in and sick people get money." A typical leftist elitist who feels he knows what is best for everyone else.

Directly relevant and on point to the issue in King vs. Burwell was this comment by Gruber: "...if you're a state and you don't set up an exchange, that means your citizens don't get their tax credits" (or subsidies). Gruber continued: "...if your governor doesn't set up an exchange, you're losing hundreds of millions of dollars of tax credits to be delivered to your citizens." The thinking was that the financial benefits of the subsidies would overcome any political objections to the feds taking over healthcare. 34 states were not persuaded.

Now, and especially for those of you who mock Fox News, do you think that the NY Times editorial staff had the intellectual honesty to mention Mr. Gruber in their 3/1/15 editorial? No they did not. They dismissed the idea of Congress encouraging states to set up an exchange in order to qualify their residents for the subsidy. Why? Because if Congress intended that result they "would have shouted it from the mountaintops." I guess the plain writing of the statute is not sufficient for the Times.

I will not make the same mistake twice. Having incorrectly predicted that SCOTUS would declare the ACA unconstitutional in 2012, I will not do so again. No, I learned my lesson. If the Court was willing to rewrite the law to define a "penalty" as a "tax," I am sure they will feel comfortable rewriting it again in order to define "state" as also meaning "federal." Furthermore, we are now several years into the enactment of the ACA, and at least Justice Kennedy was concerned about the impact on states and the effectiveness of the law if it is interpreted the way it is written - which means only state exchange enrollees get the subsidy.

It would be nice, however, if the President ("I have a pen")and the Supreme Court let the legislative branch of government do the writing of statutes, as the Constitution provides.