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July 29, 2014

WaPo's Greg Sargent Devastates Halbig Case Against Obamacare Federal Subsidies With Bombshell Reporting (JeffB.)

Guest post by JeffB./@esotericCD.


Wait, did I say "devastates?" I meant "vindicates." I get confused about stuff like that sometimes. Then again, in my defense, so does Greg Sargent. Let me explain. This is a lengthy post, so fair warning.

Quick refresher: Halbig case turns upon the question of whether the ACA, as written, permits the government to offer federal subsidies (read: price relief) to people who purchase health insurance on federally-established exchanges, or only on state-established ones. The IRS issued an official administrative ruling last year that subsidies applied to both state and federal exchanges.

The problem? The actual text of the Affordable Care Act says something different: it states that subsidies/tax credits are only available to consumers using "exchanges established by the state." Nowhere are federal exchanges mentioned, even though they pop up several times elsewhere in the statute.

This is obviously a Big Problem, since (contrary to expectations at the time of the ACA's drafting, it must be pointed out) only 14 states plus DC ultimately bothered to establish their own exchanges. The rest -- either out of protest or naked sloth -- farmed the work of establishing ACA exchanges out to the Feds.

So does that mean that, under the statutory language of the ACA as written, the residents of those 36 states are ineligible for federal subsidies and will have to pay extremely elevated prices for plans purchased via federal ACA exchanges?

We now have two answers: in Halbig v. Burwell the DC Circuit Court of Appeals said "Yes." Meanwhile, in King v. Burwell, the 4th Circuit said in so many words, "Erm...no, we guess. But honestly this language is really ambiguous and hey SCOTUS help us out here will ya?"

Chaos, predictably, has ensued. On the Left, the amusingly unified PR response to Halbig has been variations upon the theme of "LOL are you kidding? Of course Obamacare was always supposed to provide subsidies to everyone, only madmen ever thought otherwise, now hush your crazytalk."

Jonathan Gruber, unless he is in fact a madman, put paid to that argument with his deliciously self-undermining speak-oes.

So now, rushing into the breach, here comes Crack Legal Correspondent Greg Sargent of the Washington Post, with his breathlessly reported scoop that will save the day for the Left:

Senate documents and interviews undercut 'bombshell' lawsuit against Obamacare

Let's pause for a moment and savor that headline on its own for the spectacular own-goal carnage that's about to follow.


Sargent's argument, summarized, is that of course Congress meant all along for the ACA to offer subsidies on both the state and Federal exchanges, and intent only got muddled when two separate versions of the ACA legislation (one coming out of the Senate Finance Committee and one coming out of the Health, Education, Labor & Commerce Committee) were awkwardly and imperfectly merged.

There is so much that is wrong with Sargent's legal reasoning here that it's hard to know where to start. Well go with the money shot, I guess.

1) The first Senate version of the health law to be passed in 2009 -- by the Health, Education, Labor and Pensions Committee -- explicitly stated that subsides would go to people on the federally-established exchange. A committee memo describing the bill circulated at the time spelled this out with total clarity.

I could stop right here. In fact, I will. And so would the courts, if we were dealing with a less politicized piece of legislation.

Sargent just helpfully informed us that an earlier version of the ACA -- not a draft, mind you, but one that was actually passed out of committee -- included explicit language granting subsidies to people on federal exchanges, language that was later dropped from the final bill.

If Sargent had been an attorney rather than a layman, this is the point where he would have hit "delete" on his draft post and forgotten all about it.

One of most fundamental rules of statutory interpretation used by courts when they are asked to discern legislative intent from ambiguous statutory language is this: if explicit language was in an earlier version of a bill but dropped from the final version, the court will treat that as proof it was removed on purpose.

For example, if the draft copy of the "Jeff B. Memorial RINO-Hunting Act" states that "no more than six mature RINOs" can be bagged by any one hunter during open season, but the final legislation lacks the word "mature," then every court in the land would apply standard canons of construction and say that the legislature therefore intended to allow people to go after RINOs of all ages -- the earlier language was dropped for a reason, and so long as it doesn't render the statute facially nonsensical it's not the place of the court to wade any deeper into the thicket and find out what that reason was, or whether it's a "good idea."

Similarly, the argument advanced by the Left (and Sargent) that "of course the ACA intended all along for subsidies to cover federal exchanges!" is runs squarely onto the rocks of this earlier language. Thanks to Sargent's crack reporting we have now confirmed that earlier iterations of the ACA specifically granted subsidies to federal exchanges...but that, for whatever reason, this language was later stripped from the bill.

The subsequent blathering about "why" this language fell out of the bill ("drafting errors," you see) is immaterial as far as the Court is concerned, and this is apparently what Sargent doesn't seem to realize; in a case where the wording of the statute is otherwise clear, the Court's inquiry will stop cold right here -- or at least it should.

(Again, the fact that the ACA is uniquely controversial and major legislation of course plays sub rosa role here.)

This is not a fringe theory. This is not a novel legal argument. There's a reason that canons of construction are called "canons," after all. And of all the canons of statutory construction, "few are more compelling than the proposition that Congress does not intend sub silentio to enact statutory language that has earlier discarded in favor of other language."

(Don't take my word for it: that last quote is from the Supreme Court in INS v. Cardozo-Fonseca (1987).)

And the fact that Greg Sargent could blithely drop, in the midst of an attempt to shore up the Left's "legislative intent" argument, a bombshell that utterly devastates that very argument's legal chances in court without even realizing it is a mighty example of the Dunning-Kruger effect in action.

I, for one, thank him for his efforts in assisting with the legal case against Obamacare.


Bonus Damage [Ace:] Via @drewmtips, the state of Oklahoma has now moved to include Jon Gruber's "Speak-O's" into the record.

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posted by Ace at 06:42 PM

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