Sunday, March 1, 2015

Prediction: The Supremes Will Toss King v. Burwell -- The ACA of 2010 Was Intended "To Achieve Near Universal Coverage"

This coming week, the US Supreme Court will hear oral arguments in King v. Burwell -- yet another tempest in a teapot, engineered by the hubris of a few -- who hope to undo the lawful will of. . . the many.

As most of the better legal scholars have noted -- despite much of the right-leaning hullaballoo -- this case isn't really about very much. It is yet another attempt to invalidate a central component of a 900 page statute, by positing a befuddling, and counter-intuitive reading of five words in one subsection -- a subsection that deals with calculating the AMOUNT of a subsidy; not whether the subsidy should exist at all. It is beyond serious dispute that Congress intended to create near universal coverage in passing the ACA of 2010.

And so, it is the position of many legal scholars (who follow these matters closely) that the Supremes have agreed to take the case precisely to put to a final, non-appealable death the notion that five words may ever be a place where Congress intentionally hides an elephant -- deep inside a. . . mousehole.

And the central job of the Supremes here -- having already ruled that the ACA of 2010 was a valid exercise of Congressional power -- will be to uphold the intent of the Congress in passing a valid, necessary and proper (albeit complex) 900 page statute. From the excellent amicus brief of HCA, a large Tennessee based corporate hospital chain, then -- a bit of the persuasion:

. . . .In Petitioners’ view [the parties seeking to overturn this ACA provision], however, Congress made residents of every state eligible for a subsidy, only to then deny subsidies to every resident of certain states through the application of a formula for calculating the amount of the subsidy. Specifically, because the amount of the subsidy is tied to the cost of a plan offered on an “Exchange established by the State,” id. § 36B(b)(2)(A), Petitioners argue that the calculation works out to $0 for every resident of a federally-facilitated Exchange state.

Congress does not hide “elephants” in such “mouseholes.” Whitman v. Am. Trucking Ass’ns, 531 U.S. 457, 468 (2001). No member of Congress – not to mention the millions of Americans who have relied on the promise of subsidies and are now overwhelmingly satisfied with their coverage – would have understood these five words buried in a formula as making the promise of affordable coverage illusory for large swathes of the population.

The text of the statute confirms what common sense suggests: the ACA’s subsidy-calculation provision does not have the massive import Petitioners seek to give it. Rather, the ACA’s definitions make clear that every “Exchange” is treated as “established under section 1311” – the section obligating states to establish Exchanges – even when the federal government is in fact operating the Exchange under section 1321. 42 U.S.C. § 300gg–91(d)(21). Section 1311 itself specifies that every Exchange is, by operation of law, “a governmental agency or nonprofit entity that is established by a State.” 42 U.S.C. § 18031(d)(1) (emphasis added). And in directing HHS to operate “such Exchange,” Congress confirmed that a federally-facilitated Exchange under section 1321 is still, for statutory purposes, an Exchange established by the state under section 1311. ACA § 1321, 42 U.S.C. § 18041(c)(1). Together, these provisions make clear that Congress used “Exchange established by the State” in § 36B as a statutory term of art, not as a roundabout way to deny affordable coverage to residents of states that decline to run their own Exchange. . . .

Petitioners’ interpretation cannot be accepted for the additional reason that it would “undermine in a substantial way the [statute’s] purpose.” Maracich, 133 S. Ct. at 2200. There is no need to resort to legislative history to divine the fundamental legislative purpose of the ACA, because the statute makes it plain: “achiev[ing] near-universal coverage. . . .”

The fundamental question in this case is whether the ACA is in fact “a comprehensive national plan to provide universal health insurance coverage,” NFIB, 132 S. Ct. at 2606 (2012) (op. of Roberts, C.J., joined by Breyer & Kagan, JJ.), or instead contains a trap door through which millions of Americans may fall. Every tool of statutory interpretation indicates that Congress intended the former. With subsidies available on the federally-facilitated Exchanges, the newly insured are able to take personal responsibility for their care, emergency room usage is dropping, women are gaining access to needed care, and the costs and benefits of expanding coverage are being shared throughout the health care system.

Without the subsidies, an otherwise coherent regulatory scheme may come apart at the seams: the newly insured could lose coverage, the positive trends in the delivery of care noted above could be reversed, the economic logic of the ACA could be disrupted, the federally-facilitated Exchanges could slide into dysfunction, and even the previously insured could lack access to a viable alternative market.

This Court should follow the interpretation that makes sense of the ACA’s interconnected provisions. That interpretation is that subsidies are available to every “applicable taxpayer,” without regard to whether his or her state has elected to run its own Exchange. . . .

Of course you will read much right leaning rhetoric suggesting that. . . the ACA of 2010 sky is about to fall. You may safely ignore it. You heard it here first. [A very good, plain English version of this discussion appears on the editorial pages of The New York Times, this Sunday morning, as a light silvery snow drifts down here, once again. Fly safely one and all.]


Condor said...

The people who filed the suit said this:

". . .Michael Greve (in 2012) then chairman of the Competitive Enterprise Institute, which is helping to finance the current suit: "This bastard has to be killed as a matter of political hygiene. I do not care how this is done, whether it’s dismembered, whether we drive a stake through its heart, whether we tar and feather it and drive it out of town, whether we strangle it. . . ."

Anonymous said...

What if the Supreme Court finds that the federal-based subsidies are coercive? This was why the Medicaid expansion was made optional.

If the Supreme Court did that, they could rule subsidies must be completely optional. This basically wins the case for both sides, and the Supreme Court does love to split the baby. (for plaintiffs, subsidies are optional and therefore you can gain affordability exemptions if you refuse the subsidy; for respondents, anyone who wants subsidies in any state can still receive them)

Condor said...

I think your argument has some merit.

However, the Supremes will be bound by their last opinion on the ACA of 2010. They held that it was within the scope of Congressional authority to create mandatory penalties, and co-relatively, mandatory subsidies.

It was held that the means were lawful, and the ends were legitimate -- so Congress plainly had authority to enact it.

The Supremes cannot write into the five words, words that are NOT there.

But they can say the error should not thwart the intent of the law.

The intent was to provide nearly universal converage.

And so -- the Supremes are likely to say that HHS/OMB/IRS may, by rule, have the subsidies applied to "make sense" of the intent.

Essentially, treat the five words. . . as a scriveners' error.

That's my prediction.

For what it is worth.

Anonymous said...

I hope you're right Condor. All rational expectation and sound legal reasoning lead to that conclusion. Do you think that the matter of the shaky standing status of the 4 plaintiffs would give SCOTUS an out to throw out the case?

Condor said...

Only now we are learning that perhaps (and the Supremes ALWAYS have the right to dismiss for lack of standing). . . just perhaps. . . none of the four complainers in King v. Burwell have actual grounds to claim harm. CNN, and Yahoo! News, channeling the WSJ.

That is -- the plaintiffs have no standing.

If any Justice ask about this on Wednesday, you may reliably bet that the case is a loser -- the government (and the ACA of 2010) will then emerge unscathed.

Even asking the question likely dooms the libertarian position.

Trust me on this.

Should be good theatre, either way.


Condor said...

Sorry! Was typing mine when yours came in.

Yes, this could be a death knell... But the Supremes might still decide to issue a substantive opinion... To help end the mostly foolish legal maneuvers...


Anonymous said...

As a con- to your pro-:


Condor said...

Thanks! Fascinating set of thoughts from the U. Of C. Prof. (Wonder if he's any relation to the fine Chicago federal jurist of the same last name?)

I actually find his arguments largely appealing, I just don't think they will carry the day.

I must note that he also seems to think ambiguities get resolved against the government. My experience would suggest that ambiguities get resolved in the government's favor.

We will all know soon -- from the tone of the Supreme's question-lines.

Under 12 hours to go now. Do stop back, and. . . Namaste!