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What the Affordable Care Act Subsidy Case Tells Us
Gerard N. Magliocca
While most of the media's attention yesterday was focused on Hobby Lobby, the D.C. Circuit was hearing argument in a case that poses a mortal threat to the Affordable Care Act. As readers of this blog know, the subsidies to those participating in the federal exchange are being challenged on the ground that the statute authorizes subsidies only for exchanges run by states. Since only fourteen states have set up their own exchanges, that would leave most of the country out in the cold and (I gather) throw insurance premiums out of whack.
I must say that, as I matter of statutory construction, I am not persuaded by the arguments made in favor of reading the Affordable Care Act to authorize subsidies to the federal exchange. I think this interpretation is not much more than a statement that the consequences of reading the law as written would be terrible, thus it should not be done. Granted, statutes should not be read in a literal way to produce absurd results. In this case, though, I think Congress just assumed that most, if not all, states would not set up their own exchanges. I don't see why courts are obligated to correct this design flaw.
This case (unlike Hobby Lobby) reflects the fact that the President has not carried the country on the merits of the Affordable Care Act. You can see this in how the Act polls, in how the enrollments are going, and how Democratic candidates in contested seats are running from the statute. If Democrats controlled Congress, they would have fixed the text of the statute in about five seconds. The fact that they cannot do so is a symptom of a larger political problem. Posted
1:56 PM
by Gerard N. Magliocca [link]
Comments:
Isn't there a pretty big standing issue? I haven't been following these cases as well as I should.
"not carried the country on the merits of the Affordable Care Act"
Not shown. In what way? For instance, the "public" seems to like their children up to 27 to be on their plans or not being kicked off for pre-existing conditions.
"You can see this in how the Act polls"
What polls? When even conservative states have Medicaid expansion, thanks to ACA, you "can see" support, I think.
"in how the enrollments are going"
First, "enrollments" are but one aspect of the act. Second, they are going pretty well as far as I can tell.
"and how Democratic candidates in contested seats are running from the statute"
This suggests, partially out of bad judgment in the view of various experts (e.g., suggested by the popular aspects above), that they aren't carrying the specific areas. Likewise, the gerrymandered House, which won't even pass stuff that "the people" and even many (if done by blind ballot) of the Republican caucus supports.
This law continues to be misunderstood including by confused comments like this.
In the polls I've seen, about 1/3 of the people who object to the ACA do so because they favor a single-payer system, not because they agree with the republican attacks on the law. As far as enrollment's concerned, it's about where it was expected to be. And would be ahead of schedule if republicans had set up state exchanges. A distinct minority of Americans actually are opposed to universal health care.
You hypothesize that Congress thought that most if not all states would set up an exchange. But that hypothesis doesn't lead to your conclusion.
It is likely that Congress at least was somewhat worried about the possibility that at least one state would not have an exchange. (Otherwise, they would not have needed the federal exchange fallback provision.)
Even if just one state did not set up an exchange, the lack of subsidies would do more than throw some premiums out of whack. It would completely decimate the market. Think about it this way: we know that Congress specifically stated the importance of the individual mandate in preventing a death spiral. If subsidies are not available, not only would there be adverse selection problems from the hardship waiver of the individual mandate, that most of the subsidy-eligible population (which itself is about 2/3 of the individual market) would qualify for. The lack of subsidies on its own (even if there were no hardship exemption, let alone with the exemption) would likely cause much worse adverse selection problems than the lack of an individual mandate.
We are talking about not having an individual market in such states. The idea that Congress might have thought that was acceptable for even one state is absurd (particularly given all the other evidence in the case, including the other statutory absurdities that would arise from having federal exchanges not stand in the shoes of state exchanges).
Thanks for allowing comments--- even tho I don't have one. It's a good discipline for the blogger, since if he stretches things, the commenters will let readers know. Of course, not everybody likes that kind of discipline.
The "larger political problem" is that the Democrat Congress imposed Obamacare in the first instance against the wishes of their constituents and those constituents fired the Democrat House in 2010 and appear ready to repeat the process with the Democrat Senate in 2014.
The GOP won the House and is winning the Senate on a promise of repeal, not rearranging the seats on this sinking legislative Titanic.
1) A plurality of voters always opposed Obamacare and, now that they are being personally harmed by all the train wrecks, a majority opposes it. In the red and purple districts and states which will determine who controls Congress, a super majority opposes Obamacare.
2) Only a maybe a million or so of the folks enrolled into Medicaid and the government designed plans were previously uninsured out of something like 45 million uninsured. Most of the Medicaid folks were renewing and the others were switching from private plans to Obamacare to compel their neighbors to subsidize their premiums. If the subsidies disappear, so will that mercenary rationale.
Bart: "Only a maybe a million or so of the folks enrolled into Medicaid and the government designed plans were previously uninsured out of something like 45 million uninsured." Untrue. If you wanted (which you don't) to learn from people who actually know something about the subject, Charles Gaba has an argument at his go-to tracking site (http://acasignups.net/14/03/26/response-avik-roy) with Forbes' Avik Roy. Roy argues that only 15% of the exchange QHPs (say 900k out of 6m) were previously uninsured; Gaba thinks it's 50%. Roy makes no argument about the ratio for the similarly sized Medicaid/CHIP new enrolments, which are of similar size. The New York state exchange has announced that 70% of its signups (both categories together) were previously uninsured.
thus it should not be done. Granted, statutes should not be read in a literal way to produce absurd results. In this case, though, I think Congress just assumed that most, if not all, states would not set up their own exchanges. I don't see why courts are obligated to correct this design flaw.
thus it should not be done. Granted, statutes should not be read in a literal way to produce absurd results. In this case, though, I think Congress just assumed that most, if not all, states would not set up their own exchanges. I don't see why courts are obligated to correct this design flaw.LOL Elo Boost lol欧服代练 fifa coins buy fifa coins
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