Obamacare

3 Takeaways from Today's Big Rulings on Obamacare's Subsidies

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Whitehouse.gov

The administration's implementation of Obamacare took a potentially fatal blow this morning when a three-judge panel in D.C. Circuit Court ruled that the administration has no legal authority to disburse subsidies through the health law's federally run insurance exchanges. The ruling dealt with technical aspects of legislative language and congressional intent, but the basic issue was incredibly straightforward and easy to understand: The law says that subsidies are limited to exchanges "established by a State" under a particular provision of the law. The court therefore ruled that exchanges established by the federal government did not count as exchanges established by "a State."

Not long after that ruling came out, however, the fourth circuit court released a ruling coming to the opposite conclusion. It declared the overall language of the law, when looked at as a whole, to be ambiguous, and it ultimately sided with the administration, saying that the subsidies are necessary to fulfill the law's policy goals, and are therefore authorized by the law.

The conflict guarantees that the issue will drag on for a while, either to an en banc review by the entire circuit or perhaps to a Supreme Court appeal. Obviously, then, there's still a lot that's up in the air. Yet a few things did become clear today. Here are three big takeaways from today's Obamacare rulings.

1. The plain language of the relevant statute is undeniably clear. The D.C. Circuit essentially concluded that the government could not provide a good enough legal rationale for ignoring the plain meaning of the text. Even the Fourth Circuit, which held that the subsidies are authorized under the law, admitted that the challengers had a point about the particular language governing subsidies: "The plaintiffs' primary rationale for their interpretation is that the language says what it says, and that it clearly mentions state-run Exchanges….If Congress meant to include federally-run Exchanges, it would not have specifically chosen the word 'state' or referenced [the section of the law dealing specifically with state-based exchanges]." The ruling goes on to say that "the court cannot ignore the common-sense appeal of the plaintiffs' argument; a literal reading of the statute undoubtedly accords more closely with their position." This is the declaration of the court that ultimately agreed with the administration. In other words, only through a more expansive, non-literal reading can one side with the administration's approach.

2. The challenge is legitimate. As with the challenge to Obamacare's individual mandate, which ultimately lost at the Supreme Court, the health law's backers and the liberal legal community had long argued that the argument made by the challengers was more or less meritless. The win in the D.C. Circuit makes clear that it is not, and even the Fourth Circuit ruling concedes that it is a tough call, saying that "the applicable statutory language is ambiguous and subject to multiple interpretations" and only coming to its conclusion by "applying deference to the IRS's determination." Basically, the government won not because it was obviously in the right, but because it got the benefit of the doubt.

3. Another court has ruled that the president is breaking the law. The Supreme Court repeatedly ruled against the administration in a variety of cases this year, including the Hobby Lobby decision regarding Obamacare's contraceptive mandate, the administration's interpretation of chemical weapons law, and the president's recess appointment powers. The theme of these cases is clear: that the Obama administration had overstepped the bounds of its authority. The same goes for the D.C. Circuit's ruling in Halbig. One of the messages of the decision is that the Obama administration had no authority to offer subsidies through the federally run exchanges, that the IRS was not within its legal rights to authorize those credits, and that the executive branch has broken the law in making those subsidies available.

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  1. The plain language of the relevant statute is undeniably clear.

    And probably irrelevant. This law is about feelings.

    1. ?and always being first to post.

  2. They don’t need to be bound by any written law; progressive moral superiority is all the protection we need. Right, Weigel?

  3. Who gives a fuck about the plain language of the law? It’s all pretense and smokescreens at this point. It’s like the Roman Senate during imperial deification — it’s all a comforting illusion.

    1. We had to pass it to ignore what’s in it.

      1. +1 Augustus.

  4. saying that “the applicable statutory language is ambiguous and subject to multiple interpretations”

    Umm, “exchanges established by the states” is ambiguous? How?

    1. I’m also pretty sure laws in this country are specifically prohibited from being ambiguous, precisely because they shouldn’t have multiple meanings.

  5. In other words, the Justices on the 4th should be disbarred, tarred , and feathered for flagrantly violating the law in the name of political expedience. That is, if I am to take their own opinion at face value.

  6. The ruling goes on to say that “the court cannot ignore the common-sense appeal of the plaintiffs’ argument; a literal reading of the statute undoubtedly accords more closely with their position.

    But FYTW.

    And the Republic is pretty much done.

    1. Sorry, Franklin. We COULDN’T keep it. God forgive us.

      1. I apologize for nothing. If I had been given absolute power, I would have had this shit sorted well before now.

  7. The original plan was to have it be one of these situations where the states would be encouraged to set up an exchange through the money offered, same way that the Medicaid expansion works, or the age 21 drinking age, etc. (Of course they’d owe the taxes regardless.) The Congressional Research Service agreed on this.

    They did change their mind later once they realized that there was no way that they could force states to make working exchanges (and they found out that even some enthusiastic states had a horrible time of it), but they never changed the language. Guess they should have read it before passing it.

  8. If Congress meant to include federally-run Exchanges, it would not have specifically chosen the word ‘state’ or referenced [the section of the law dealing specifically with state-based exchanges].

    Allow me to finish that for them…

    But since we don’t like that outcome, fuck it.

  9. What is the relevance of the Medicaid expansion ruling (ie, that the discrepancy between grants for states who played ball and who did not was substantial enough to constitute an attack on their sovereignty) to this one?

    Could a higher court simultaneously find that the conservative understanding of the law is correct, while determining that it constitutes essentially holding citizens of non-exchange states hostage so as to undermine state sovereignty, and thus uphold federal subsidies on that account?

    1. If the 4th Circuit is any indication, they can do whatever they want.

      1. But SCOTUS is a more relevant indicator for what SCOTUS would do. This would insulate the GOP establishment from charges of heartlessness, while also letting them smack down executive and legislative overreach by the Democrats.

    2. Such a ruling would basically say:
      1) The IRS cannot override the clear intent of Congress
      2) The clear intent of Congress was for federal exchange users to be ineligible for subsidies
      3) That intent constituted an attack on state sovereignty, and thus was illegitimate
      QED: Subsidies for all, but the executive branch and legislative branch both get a constitutional smackdown

      1. If that really was the logic, then the correct ruling would be to make Congress either give subsidies to all or none. If the courts decided it was subsidies for all, they’d be overstepping.

        1. Now that I think about it, I am misremembering that decision. They did uphold the government’s position regarding the expansion funds, they just prevented them from completely removing Medicaid funding from states.

          So, who knows.

      2. 3) That intent constituted an attack on state sovereignty, and thus was illegitimate
        QED: Subsidies for all, but the executive branch and legislative branch both get a constitutional smackdown

        Giving states subsidies but not the federal government subsidies is illegitimate?

        Ever hear of the highways?

  10. the applicable statutory language is ambiguous and subject to multiple interpretations

    And the law’s policy goals were not?!

    1. the applicable statutory language is ambiguous and subject to multiple interpretations

      Subject to the interpretation of what the definition of ‘is’ is.

      As I said earlier, the law can mean whatever the hell you want it to mean now. If SCOTUS can uphold Obamacare on the grounds of a penaltax, they sure as hell can uphold it over a fedastangesidy.

  11. “Derpy derp IRS should have discretion in interpreting the law…cuz what the hell do we know about the law… lulz”

    – Fourth Circuit

  12. “The plaintiffs’ primary rationale for their interpretation is that the language says what it says”

    “The language says what it says”?

    You mean, like, “Congress shall make no law” and “shall not be infringed”?

    Good luck with *that* quaint approach, plaintiffs.

  13. Fourth takeaway: The Obama administration will do what it wants and will face no consequences.

  14. Should not LAWS have a concrete meaning and, primarily, mean what they say? Should not any LAW that is found to be ambiguous become null and void on the spot? A man can dream, I suppose.

  15. Circumventing the clear language of the law, we now have the IRS (of all Federal departments) basically legislating federal exchanges.

  16. I would be embarrassed to issue the ruling the 4th issued.

    I dont think Ive seen a more FYTW ruling ever. At least try to make some sort of legal sense.

  17. So now “SPIRIT” of law trumps legal language? If 4th Circuit Court decision is allowed to stand “ambiguity” could become the hot new legal defense for everything; a speeding ticket in a school zone… prove children were present. DUI convictions could no longer rely on the written BAC %… rather prove alcohol was really a factor. SPIRIT of law could actually rock!!!! but he 4th Circuit could not be more wrong.

  18. What bothers me most about the judicial system is how easily judges use personal feeling to sway their rulings. Appeal courts, Supreme Courts… they are supposed to rule above their political ideology.

    Can you imagine?…

    Judge: I’m sorry, but I’m going to lock you up.
    Defendant: But why? I did not break any laws.
    Judge: Because I’m going to give the benefit of the doubt to the prosecution.

    1. “But if we don’t like you, and you serve no purpose to us…………you lose”

      The Federal Government

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