A Few Missing Words Could Take Down Obamacare
This is why the state must resist implementing Obamacare.
Since the Supreme Court upheld the health insurance mandate in Obamacare, conservatives have taken the battle against the law to the state level arguing that the law can still be resisted by states refusing to go along with the implementation of health care exchanges and the expansion of the Medicaid program.
Both the state implementation of exchanges and the Medicaid expansion were provisions of the law designed to lure the states into accepting responsibility for huge portion of the law and its cost, thus hiding the real cost of the bill during the debate over its passage.
Critics of these efforts to resist have insisted that it doesn’t matter if the states implement the exchanges or not noting that if the states don’t do it the federal government. But therein lays the rub. According to the law as written, the only health insurance plans can be subsidized are those sold through the state exchanges. There is no subsidy for insurance plans bought through federal exchanges.
Absent that linchpin in the law, covering those required to buy health insurance but who cannot afford it, the Obamacare law falls apart:
It starts with the the Affordable Care Act’s defining a health insurance exchange, in scintillating Section 1311, as a “governmental agency or nonprofit entity that is established by a state.”
The last three words are the crucial ones, because they indicate that only states can establish exchanges under that Section 1311. There’s a whole other part of the law, Section 1321, that allows the federal government to set up federal exchanges in states that do not take on the task themselves.
This all matters in the all-important Section 1401, where it lays out who can get a federal insurance subsidy. There, the law says that only those who are “enrolled … through an Exchange established by the State under 1311.”
If there’s a smoking gun in this case, it’s that sentence right there. It says that the only people who can qualify for subsidies are those who get coverage through a state-based exchange.
“The statute was very poorly drafted if the intent was to cover federal exchanges,” says Kevin Outterson, a Boston University professor who focuses on health policy and who previously worked as a tax attorney. “If I had a client who had recently lost some money on a provision like this, I’d say you have a pretty good chance to win that case.”
There’s no doubt that the law, as it is written, does not allow insurance policies sold through federal exchanges to be subsidized. But even so, Democrats want their interpretation of the law to be followed, not what the words actually say:
“The clear intention of the health-care law is to provide consumers with tax credits to purchase quality, affordable health coverage through either a state or a federally-facilitated exchange,” says Sean Neary, Senate Finance Committee communications director [and spokesman for Senator Max Baucus].
This sets up a debate which goes far beyond the health care/health insurance issue and into the question of rule of law. Does the law mean what the law means, or does it mean what the politicians want it to mean at any given moment?
If Congress meant the law to read something else, then Congress can change the law, but until they do so the law should be followed as written. And as written, Obamacare can’t work.
As long as enough states aren’t fooled into going along with implementing the exchanges.Tags: health care exchanges, obamacare