Source: https://alazycowboy.com/2014/07/25/free-at-last-halbig-v-burwell/
Timestamp: 2019-04-23 04:00:51+00:00

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I was chuckling my way through Nicholas Bagley’s article, Halbig said it was applying the law as written. Don’t believe it, when I realized that I needed to refresh my memory on the grand bargain offered by the Affordable Care Act supporters. There is rich irony in hearing Mr. Bagley allege there was a consensus on providing subsidies in federal exchanges when at the same time the Speaker of the House was saying “we have to pass the bill so that you can find out what is in it”. The Speaker of the House does not know what is in the bill except in vague terms. I doubt she cared how subsidies were supposed to work. Then we get to the question that if postponing a large part of the Affordable Care Act is a pretty good indicator that the supporters were particularly bad at writing this law then why should we assume their intentions concerning subsidies are different than what was written in the law? The overwhelming body of evidence says they did not know what they were doing when they wrote the bill and no one checked the work. If there was a consensus then it was to write the law in the vaguest of terms so that they could do what ever they wanted if a problem arose. It took several years before problems arose and someone sued. Instead of working with Congress to fix the problems they resorted to fixing the problems via administrative rulings. Although it is difficult to discern Congress’s intention with a law so poorly written, I think it is safe to say that they have been making it up as they went along.
My recollections of the intent of the subsidies differ from Mr. Bagley. When the law was passed I remember the supporters like Mr. Gruber were constantly reminding reluctant states that the subsidies were only being offered to people who purchased their health insurance from state exchanges. They argued that the states better get busy setting up their exchanges if they want their citizens to get that subsidy. This subsidy argument magically disappeared when major employers figured out they could get out of the hated employer mandate penalties if states opted for the federal exchange route. If a state did not set up an exchange then subsidies would not be available. If subsidies were not available then the law says that employers would not be penalized. Was I imagining this? Fortunately I did not have to go far to clear up this subject.
In the Washington Post article, Why the DC Circuit’s interpretation of the ACA in Halbig v. Burwell is far from “absurd”, Mr. Somin lays out the grand bargain like this.
Under the DC Circuit ruling, a state’s residents can only get ACA tax credits for purchasing health insurance if their state decides to establish and operate an insurance exchange. This creates a strong incentive for state governments to create such exchanges, thereby participating in the administration of Obamacare. If they do as the federal government wants, their residents get millions of dollars in tax credits, and their insurance companies and health care providers get lots of new business. By contrast, states would have far less incentive to create their own exchanges if they can rely on the federal government to do all the administrative heavy lifting without imperiling their residents’ eligibility for federal tax credits.
The unanswered question was the impact of state exchanges on the employer mandate. I found the answer to that question in the Forbes article, Halbig v. Burwell Would Free More Than 57 Million Americans From The ACA’s Individual & Employer Mandates, in which Mr. Cannon argues that a victory for the Halbig plaintiffs would free more than 8.3 million residents from the individual mandate and 250,000 firms and 57 million employees from the employer mandate. Wow, this is better than I thought! We get rid of the two most hated parts of the Affordable Care Act with one ruling. As a person who may find himself faced with an individual mandate penalty in 2015 I really like the Halbig v. Burwell decision. This is Christmas in July!
If most of the country hates the individual and employer mandates and the court has an easy, legal way to give the people what they want, what is the court to do? Here are the alternatives I see for the court.
This is the current strategy used by the court. Make narrow rulings and hope Congress or the Administration will fix the big problems. In this strategy the court overturns the Halbig v. Burwell decision and lets the case get appealed to the Supreme court. The problem with this strategy is that it is heavily dependent on the Administration fixing the broader problems with the hated individual and employer mandates via administrative rulings. History has shown that setting rules by edict are likely to cause more problems then they solve. For such an unpopular law this strategy practically guarantees that the court will continue to be flooded with cases challenging the constitutionality of administrative laws when the law reads otherwise.
In this strategy the court gives up trying to fix the Affordable Care Act and confirms the Halbig v. Burwell decision. No more convoluted legal opinions like the one used by Justice Robert to justify the individual mandate as a tax. Judges can go back to interpreting the law rather than reading tea leaves. This ruling would force responsibility to fix the law back on the Administration and Congress and probably forces those two branches of government to work together to fix this health law in a non-partisan manner. We already know the other way doesn’t work. The hated individual and employer mandates get fixed by the legislative process. I envision a process similar to that was used by Congress to determine which military bases to close.
This is a variation of the Whac-A-Mole strategy in which the court does not rule on the Halbig v. Burwell decision in 2014 and lets the Administration try to minimize the problems with the individual and employer mandate issues. The key part of this strategy is to not make a decision until the court can see if the subsidy system is sustainable. If adverse selection rears its ugly head and the subsidy system is not sustainable then confirming Halbig v. Burwell is not a problem. The subsidy system is going to be overhauled anyway. If the subsidy system looks like it is workable then the court can decide at that time what to with Halbig v. Burwell.

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