Tag: individual mandate

WSJ: Dems Nuked Filibuster to Defeat Halbig v. Sebelius

Wall Street Journal editorial surmises that Senate Democrats eliminated the filibuster for non-Supreme Court judicial appointments so they could pack the U.S. Court of Appeals for the D.C. Circuit with judges that would block an important ObamaCare case called Halbig v. Sebelius:

Democrats surprised Republicans in November with how quickly they dismantled the filibuster, and we are beginning to see why. Another major challenge to ObamaCare is being heard by a D.C. Circuit district judge, this time concerning whether subsidies can be delivered by the federal exchanges. Then there’s the new IRS proposed rule curtailing the political speech of 501(c)(4) groups. This rule will also probably make its way to the D.C. Circuit, and blocking GOP-leaning groups from politicking is part of the Democratic strategy for holding the Senate in 2014.

Democrats figure they have a better chance to win if they have more nominees on the appeals court—either in a three-judge panel or en banc. The plaintiffs could appeal to the Supreme Court if they lose, but you never know if the Justices will take a case.

Case Western Reserve University law professor Jonathan H. Adler and I laid the groundwork for Halbig and three other cases challenging President Obama’s attempt to tax Americans without congressional authorization in this law-journal article.

‘There Is No Such Thing as an Individual Mandate. It’s a Tax.’

That’s what Department of Justice attorney Joel McElvain said in open court last week. And thus the Obama administration reversed itself once again on whether the individual mandate is a tax. 

Relatedly, a Clinton-appointed federal judge has dealt a second blow to the IRS and the credibility of its defenders. He called one of the administration’s arguments ‘silly,’ and promised expedited consideration of the Obamacare challenge, Halbig v. Sebelius. Read all about these in my latest Darwin’s Fool post at Forbes.com.

Halbig Plaintiffs Request Preliminary Injunction

Halbig v. Sebelius is one of two federal lawsuits challenging an illegal IRS rule that attempts to issue ObamaCare’s tax credits in the 34 states that have opted not to establish one of the law’s health insurance “exchanges.” Yesterday, attorneys for the Halbig plaintiffs filed a motion for a preliminary injunction, requested a hearing on that motion before October 1, and filed a second motion also seeking to expedite the case. The first motion requests:

an Order enjoining [the government], pending resolution of the litigation, from applying the IRS regulations extending eligibility for premium assistance subsidies under the Patient Protection and Affordable Care Act to individuals who purchase health coverage through Exchanges established by the federal government.

If the court grants that request, ObamaCare implementation will come to a screeching halt.

The Halbig plaintiffs make a compelling case that the IRS is violating federal law, and that the court must resolve the issue before January 1, 2014. If a resolution comes after that date, the plaintiffs will be irreparably injured because they “will be forced either to comply with the ACA’s individual mandate or risk incurring a penalty, and…will further be entirely and forever precluded from purchasing catastrophic coverage for 2014.” In addition: 

the balance of the equities and public interest both cut strongly in favor of resolving the legal validity of the IRS Rule now, before billions of taxpayer dollars are illegally expended and before employers make unalterable benefit decisions premised on the Rule. If a ruling invalidating the IRS Rule is delayed until after these events, the result would be utter chaos…It serves everyone’s interests—those of Plaintiffs, the Government, and the public alike—to obtain a prompt ruling on the legal validity of the IRS Rule, so that there will be no need subsequently to confront the logistical nightmare of trying to unscramble and undo the unlawful expenditure of billions of federal dollars. [Emphasis in original.]

Even if the government ultimately prevails, as health-benefits expert Thomas Haynes explains in a supplemental filing, it would unnecessarily and irreparably injure some employers and employees if that happens in 2014 instead of 2013. Brokers who are aware that the availability of these tax credits is uncertain in 34 states will counsel employers not to adjust their employee benefits to take advantage of that still-uncertain new landscape. Those employers and employees would then be locked into spending more on health insurance in 2014 than they would if the litigation had been resolved in 2013. 

The Obama administration, however, is in no hurry. In Halbig, for example, government lawyers have blown through the legal deadlines for responding to key plaintiff motions, deadlines that passed months ago. Indeed, they appear to be using every tactic at their disposal to guarantee these cases will not be resolved this year.

Whether the Obama administration’s lawyers simply have a lot on their plate, or are intentionally trying to prejudice judges against ruling for the plaintiffs – by guaranteeing that such a ruling would result in maximum chaos – a preliminary injunction is in order. 

Big Business Gets Yet Another Obamacare Delay That Individuals Don’t

“I didn’t simply choose to delay this on my own,” President Obama reassured the nation about his unilateral decision to delay Obamacare’s employer mandate. “This was in consultation with businesses all across the country,” he said, as if that made the situation better instead of worse. Obama threw his “consultants” another bone when he decided to delay the reporting requirements the law imposes on employers, also until 2015. The president’s generosity toward large corporations will be financed by the American taxpayer. The Congressional Budget Office projects these delays will cost taxpayers another $3 billion in new government spending and reduce federal revenues by $9 billion, for a total increase in the federal debt of $12 billion. Yet the president fails to show the same concern for individual taxpayers. When the House of Representatives, including dozens of Democrats, voted to extend the same break to individuals by delaying Obamacare’s individual mandate by one year, President Obama threatened to veto that bill. Bizarrely, he also threatened to veto another bill (approved by an even broader bipartisan majority) that would make legal his illegal delay of the employer mandate.

So perhaps we should not be too surprised now that the New York Times reveals yet another delay the president approved at the behest of big business:

In another setback for President Obama’s health care initiative, the administration has delayed until 2015 a significant consumer protection in the law that limits how much people may have to spend on their own health care.

The limit on out-of-pocket costs, including deductibles and co-payments, was not supposed to exceed $6,350 for an individual and $12,700 for a family. But under a little-noticed ruling, federal officials have granted a one-year grace period to some insurers, allowing them to set higher limits, or no limit at all on some costs, in 2014…

[F]ederal officials said that many insurers and employers needed more time to comply because they used separate companies to help administer major medical coverage and drug benefits, with separate limits on out-of-pocket costs…

A senior administration official, speaking on condition of anonymity to discuss internal deliberations, said: “We knew this was an important issue. We had to balance the interests of consumers with the concerns of health plan sponsors and carriers, which told us that their computer systems were not set up to aggregate all of a person’s out-of-pocket costs. They asked for more time to comply.”…

Theodore M. Thompson, a vice president of the National Multiple Sclerosis Society, said: “The promise of out-of-pocket limits was one of the main reasons we supported health care reform. So we are disappointed that some plans will be allowed to have multiple out-of-pocket limits in 2014.”

It is a sign of Obamacare’s complexity that the Obama administration felt it needed to issue this delay. It is a further sign of the law’s complexity that this delay was announced in February, yet is only coming to light now.

Guess Who’s One of the Hill’s ‘100 People to Watch This Fall’

I guess I’ll have to tout this myself. Last week, the Hill newspaper put me on its list of “the 100 people you can’t ignore this fall if you’re wondering how events in Congress and the White House will play out.” Here’s the write-up

Michael Cannon Director of health policy studies at the Cato Institute
 
Think the Supreme Court has settled the question of ObamaCare’s legality? Not if Cannon has anything to say about it. Cannon is a tireless advocate for the argument that the IRS has illegally implemented the healthcare law’s insurance subsidies, which will help low-income households cover the cost of their premiums. 
 
His argument is that healthcare law, as written, does not allow for the subsidies to be used in healthcare marketplaces that are set up by the federal government.
 
He helped the state of Oklahoma file a lawsuit against the subsidies, and a group of small businesses filed a separate suit on the same grounds, in case Cannon’s runs into procedural roadblocks.
 
If the lawsuits Cannon has spearheaded are successful, they could have a devastating impact on the healthcare law. A final decision in favor would stop the flow of tax subsidies to people in more than half of the states, making ObamaCare far less attractive to consumers and stripping away much of the law’s promise of affordability.

Corrections and amplifications. The argument is as much Jonathan Adler’s as mine; we develop it together in this law-journal article. The argument is not that the IRS is illegally implementing otherwise lawful subsidies; it is that the IRS is trying to dispense some $700 billion in illegal subsidies that Congress expressly did not authorize, and impose illegal taxes on millions of employers and individual Americans starting in 2014; that the Obama administration is attempting to tax, borrow, and spend nearly $1 trillion without congressional authorization. Finally, I am neither a party nor counsel nor financier to either Pruitt v. Sebelius or Halbig v. Sebelius.

Harvard Health Policy Review on the IRS’s Illegal ObamaCare Taxes

In the just-released Spring 2013 issue of Harvard Health Policy Review, I have an article titled “ObamaCare: The Plot Thickens.” The article examines the IRS rule that purportedly implements ObamaCare’s tax credits, but actually violates that statute by taxing, borrowing, and spending hundreds of billions of dollars contrary to Congress’ explicit instructions. (The article is a less-technical version of my Health Matrix article (coauthored with Jonathan Adler), “Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits Under the PPACA.”) Here’s an excerpt:

In broad daylight, the Internal Revenue Service is attempting to tax, borrow, and spend [roughly] $800 billion—contrary to both the express language of the PPACA and congressional intent. Thus in addition to other abuses that have recently come to light, the IRS is attempting to tax millions of employers and individuals without congressional authorization…

In this still-unfolding narrative, the Obama administration’s actions are triply anti-democratic. First, the IRS is violating a direct constraint that popularly elected legislators placed on the executive branch. Second, it is violating that duly enacted statute for the purpose of denying popularly elected state officials the vetoes Congress gave them over certain provisions of the statute. And third, it is violating the statute because administration officials either cannot fathom or will not accept that Congress meant to do what it clearly did.

Obama administration officials continually emphasize that the PPACA is “the law of the land.” That remains to be seen, in more ways than one.

Obamacare: House Hearing on the IRS’s Illegal Taxing, Borrowing & Spending

As Jonathan Adler and I detail in our Health Matrix article, “Taxation Without Representation: The Illegal IRS Rule to Expand Tax Credits Under the PPACA,” the Obama administration is attempting to rescue Obamacare from oblivion by literally taxing, borrowing, and spending more than $700 billion without congressional authorization. In a recent letter to the editor of the Washington Post, I explain how these illegal taxes are already hurting workers. 

On July 25, chairmen of the House Ways & Means Committee, the House Committee on Oversight & Government Reform, and two Oversight subcommittees sent a letter to Treasury Secretary Jacob Lew demanding information related to the illegal tax-credit rule.

The House Oversight Subcommittee on Health Care has announced it will hold a hearing this Wednesday, July 31, on the IRS’s illegal tax-credit rule titled, “Oversight of IRS’s Legal Basis for Expanding ObamaCare’s Taxes and Subsidies.” Adler will testify alongside Oklahoma Attorney General Scott Pruitt and Missouri physician and small business owners Charles Willey, each of whom has filed suit to block the IRS’s illegal rule. 

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