Tag: Obamacare

King v. Burwell and the Triumph of Selective Contextualism

This Thursday, the Cato Institute will release the 14th edition of the Cato Supreme Court Review, covering the Court’s October 2014 and 2015 terms. The lead article, “King v. Burwell and the Triumph of Selective Contextualism,” is by Jonathan Adler and yours truly. Here’s the abstract:

King v. Burwell presented the question of whether the Patient Protection and Affordable Care Act of 2010 (ACA) authorizes the Internal Revenue Service (IRS) to issue tax credits for the purchase of health insurance through Exchanges established by the federal government. The King plaintiffs alleged an IRS rule purporting to authorize tax credits in federal Exchanges was unlawful because the text of the ACA expressly authorizes tax credits only in Exchanges “established by the State.” The Supreme Court conceded the plain meaning of the operative text, and that Congress defined “State” to exclude the federal government. The Court nevertheless disagreed with the plaintiffs, explaining that “the context and structure of the Act compel us to depart from what would otherwise be the most natural reading of the pertinent statutory phrase.” The Court reached its conclusion by disregarding portions of the ACA’s text and considering only selected elements of the ACA’s structure, context, and purpose. The King majority’s selective contextualism embraced an unexpressed congressional “plan” at the expense of the plan Congress actually enacted.

Our article—which is available now at SSRN—quotes Darth Vader more often than any previous Cato Supreme Court Review article. (Probably.)

Adler and I will also discuss the King ruling on a panel at Cato’s 14th Annual Constitution Day Conference this Thursday, September 17, from 10:45am-12pm. Click here to register.

On Health Care, Walker and Rubio Offer ObamaCare-Lite

In today’s Manchester Union-Leader, I explain the eerie resemblance that the health care plans advanced by presidential candidates Gov. Scott Walker (R-WI) and Sen. Marco Rubio (R-FL) bear to ObamaCare:

The centerpiece of both “replace” plans is a refundable tax credit for health insurance. Yet such tax credits already exist, in Obamacare. Also like Obamacare, the Walker/Rubio tax credits would allow Washington to decide how much coverage you purchase, penalize you if you don’t buy that government-defined plan, and conceal massive redistribution of income under the rubric of tax cuts…

How would Walker and Rubio pay for their new spending? Would they keep Obamacare’s tax increases? Raise taxes elsewhere? Would they finance new health care spending by cutting existing health care programs? If so, chalk up yet another way their plans would resemble Obamacare.

I also provide an alternative for reformers who actually want better, more affordable, more secure health care.

Conservatives can offer a better “replace” plan that is politically feasible by expanding a bedrock conservative initiative: health savings accounts, or HSAs, which have already enabled 14.5 million Americans to save more than $28.4 billion for their medical expenses tax-free.

Expanding HSAs would give workers a $9 trillion effective tax cut, without cutting spending or increasing the deficit, and would drastically reduce government control over Americans’ health decisions. Most important, “large” HSAs would spur innovations that make health care better, cheaper, and more secure — particularly for the most vulnerable.

Conservatives need to get this right, lest they repeat the same mistake they made in 1993-94.

For decades, prominent conservatives advocated an individual mandate. The left then picked up the idea and gave us Obamacare. Before they once again fall into the same trap, conservatives should drop any support for the implicit mandate of health-insurance tax credits. Expanding HSAs is more compassionate and provides a direct route toward freedom and better health care.

For more on Large HSAs, see here, here, and here.

Bloomberg BNA Podcast on Legal Challenges to ObamaCare

In this Bloomberg BNA podcast, Supreme Court correspondent Kimberly Robinson and I discuss King v. BurwellSissel v. HHS (the Origination Clause case), and House of Representatives v. Burwell, (the House GOP’s lawsuit against the Obama administration’s efforts to exceed its powers under the Constitution and the Affordable Care Act).

Keep an eye out for my article on King v. Burwell with Jonathan Adler in the upcoming Cato Supreme Court Review.

Adler and I will be speaking about King at the Cato Institute’s 14th annual Constitution Day symposium on September 17, 2015. Register here.

King v. Burwell: How the Supreme Court Helped President Obama Disenfranchise His Political Opponents

Criticizing my recent post-mortem on King v. Burwell, Scott Lemieux kindly calls me “ObamaCare’s fiercest critic” for my role in that ObamaCare case. Other words he associates with my role include “defiant,” “ludicrous,” “farcical,” “dumber,” “snake oil,” “ludicrous” (again), “irrational,” “aggressive,” “comically transparent,” and “dishonest.”

Somewhere amid the deluge, Lemieux reaches his main claim, which is that (somehow) I admitted: “the King lawsuit wasn’t designed to uphold the statute passed by Congress in 2010. It was intended to ‘enfranchise’ the people who voted against the bill.” I’m not quite sure what Lemieux means. But perhaps Lemieux doesn’t understand my point about how the Supreme Court helped President Obama disenfranchise his political opponents.

As all nine Supreme Court justices acknowledged in King, “the most natural reading of the pertinent statutory phrase” is that Congress authorized the Affordable Care Act’s premium subsidies, employer mandate, and (to a large extent) individual mandate only in states that agreed to establish a health-insurance “Exchange.” That is, all nine justices agreed that the plain meaning of the operative statutory language allows states to veto key provisions of the ACA—sort of like the Medicaid veto that has existed for 50 years and lets states destroy health insurance for millions of poor Americans. The Exchange veto includes the power to shield millions of state residents from the ACA’s least-popular provisions: the individual mandate and the employer mandate.

Obamacare’s Not-So-Hidden Tax: Thank You for Smoking

Without government interference, insurance markets will naturally charge higher premiums for riskier individuals. For example, life insurance premiums vary considerably based on factors that increase the likelihood of death, such as age, gender, smoking status, and health.

Under Obamacare, many factors that influence healthcare expenditures are excluded from premiums. For example, premiums make no distinction for obesity, likelihood of having a baby, alcoholism or pre-existing conditions. One notable exception is for smokers, where premiums may be up to 50 percent higher than that for non-smokers. I have collected data on premiums for smokers and non-smokers in 35 states, and the data shows large variation in the extent to which smokers are charged more for their choice.

Slate Discovers Rising ObamaCare Premiums

Now that the coast is clear, Slate has an honest assessment of ObamaCare premiums. Helaine Olen writes

Under this assault [from ObamaCare opponents], all too many ACA defenders turned into fanboys and fangirls, dismissing any issue raised against the law as inconsequential and exaggerated…

But this strategy might well come back to bite the Democrats. The bill for the health care expansion is coming due, just as the recipients will be heading to the ballot box to vote in the first primaries for the 2016 election. More than a few are likely to be annoyed.

Last week Oregon’s insurance commissioner, Laura Cali, announced that the state had approved a 25 percent premium increase for the largest health insurer on the state’s exchanges. The second largest insurer did even better: It received permission to boost its monthly charge to consumers by 33 percent…

And that sounds like a relative bargain compared with Minnesota and New Mexico, where the BlueCross BlueShield family is looking for increases of more than 50 percent. Even if the final numbers are lower than the asks, it seems quite likely these states will approve substantive premium increases.

The problem is simple. As Trudy Lieberman reported this month in Harper’s, the ACA made a decent stab at solving the problem of Americans lacking insurance. Unfortunately, the bargain struck to get the bill to a point where lobbyists for the hospital, insurance, and pharmaceutical industries to sign on, or at least not fight it, did not adequately address the issue of overall medical costs.

And that’s where the consumer comes in. Someone is “it,” the party paying the bill. And that “it” is increasingly you, whether you receive insurance on the exchanges or from an employer.

Or as I like to put it, ObamaCare doesn’t make health insurance more affordable. It robs Peter to pay Paul. When selling ObamaCare, supporters told everyone, “Don’t worry, you’re Paul.” But as time goes by, more Americans are realizing they’re not Paul. They’re Peter.

The ACA Is Dead — Long Live ObamaCare

My first, but not remotely my last, oped on the Supreme Court’s ruling in King v. Burwell appears in today’s Washington Examiner. Excerpt:

Obamacare supporters are mistaken if they think the Supreme Court’s King v. Burwell ruling settles the issue. Even in defeat, King threatens Obamacare’s survival, because it exposes Obamacare as an illegitimate law…

By overriding the operative language of the statute, the Supreme Court colluded with the president to impose taxes and entitlements that no Congress ever approved; to deprive states of powers Congress granted them to block parts of the ACA; and to disenfranchise Republican and independent voters who swept ACA opponents into state office in 2009, 2010 and 2011 for the purpose of blocking the ACA.

The Supreme Court did not lose its legitimacy with King v. Burwell — it has made worse mistakes. Obamacare did. Having been rewritten over and over by the president and the Supreme Court rather than Congress, Obamacare cannot claim to be a legitimate law.

Read the whole thing.