The Supreme Court should rule in the next few weeks on the case of King v. Burwell. That decision will either enforce the Obamacare statute as passed by Congress, or it will ignore the clear statutory language, violate clear Supreme Court precedents and result in the Court divining what the law really means from something other than the clear language. As the date for the decision gets closer, there are more and more articles appearing in the media denouncing the idea that four "misplaced" words could result in upsetting the entire Obamacare law.
Let's back up a bit and look at the crux of the dispute. Under Obamacare, subsidies are available only to people who buy health insurance through "an Exchange established by the State under section 1311" of the act. If no subsidies are available in a state, then the Employer Mandate (which requires most companies to provide health insurance in that state) does not apply. Further, the Individual Mandate (which requires all individuals to purchase insurance) does not apply in states where subsidies are not available. That means that absent subsidies in a state, nearly the entire Obamacare structure would not go into effect.
When Obamacare was passed, the president and his supporters all expected that every state would set up a health insurance exchange, but that is not what happened. Only about a third of the states set up their own exchanges; the rest relied on the federal government. Even among those states that set up their own exchanges, the numbers have been falling. Hawaii, for example, just gave up on its own exchange and decided to use the federal exchange. Much more than half of the people in the USA live in states that do not have their own exchange.
Despite the language of the Obamacare statute, the IRS issued regulations that require that people who buy their insurance on the federal exchange will get subsidies, that the Employer Mandate will be in effect in all states and that the Individual Mandate will also be in effect in all states.
The lawsuit before the Supreme Court is based upon the lack of state exchanges in the bulk of the country. Certain employers who do not think that they should be forced to comply with the Employer Mandate asked the court to invalidate the IRS regulations and to enforce the statute as written instead. They want no subsidies or mandates in states that did not establish their own exchanges.
For over a year, the mantra of those who want the courts to ignore the clear language of the statute is that the phrase "established by the State" consists of only four misplaced words. Those words, they tell us, clearly meant to include exchanges established by the federal government as well. In the context of the statute, the "State" was meant to include the feds as well. The problem with this argument is that there are not just four words at issue; there are seven: "established by the State under section 1311" of the Act. It may sound like a small difference, but it makes all the difference in the world. Section 1311 of the Obamacare Act authorizes individual states to establish exchanges for selling health insurance policies. The next section, namely section 1312, authorizes the federal government to establish an exchange to sell insurance in those states which do not set up their own exchange. Got that? An exchange established by the State under section 1311 cannot include the federal exchange. That federal exchange was established under section 1312 of the act.
The precedent is very clear when it comes to interpreting statutes. The Court will not rewrite a law; it will stick to the clear meaning of what was passed. Only Congress and not the Court can change the language of the act.
Let's back up a bit and look at the crux of the dispute. Under Obamacare, subsidies are available only to people who buy health insurance through "an Exchange established by the State under section 1311" of the act. If no subsidies are available in a state, then the Employer Mandate (which requires most companies to provide health insurance in that state) does not apply. Further, the Individual Mandate (which requires all individuals to purchase insurance) does not apply in states where subsidies are not available. That means that absent subsidies in a state, nearly the entire Obamacare structure would not go into effect.
When Obamacare was passed, the president and his supporters all expected that every state would set up a health insurance exchange, but that is not what happened. Only about a third of the states set up their own exchanges; the rest relied on the federal government. Even among those states that set up their own exchanges, the numbers have been falling. Hawaii, for example, just gave up on its own exchange and decided to use the federal exchange. Much more than half of the people in the USA live in states that do not have their own exchange.
Despite the language of the Obamacare statute, the IRS issued regulations that require that people who buy their insurance on the federal exchange will get subsidies, that the Employer Mandate will be in effect in all states and that the Individual Mandate will also be in effect in all states.
The lawsuit before the Supreme Court is based upon the lack of state exchanges in the bulk of the country. Certain employers who do not think that they should be forced to comply with the Employer Mandate asked the court to invalidate the IRS regulations and to enforce the statute as written instead. They want no subsidies or mandates in states that did not establish their own exchanges.
For over a year, the mantra of those who want the courts to ignore the clear language of the statute is that the phrase "established by the State" consists of only four misplaced words. Those words, they tell us, clearly meant to include exchanges established by the federal government as well. In the context of the statute, the "State" was meant to include the feds as well. The problem with this argument is that there are not just four words at issue; there are seven: "established by the State under section 1311" of the Act. It may sound like a small difference, but it makes all the difference in the world. Section 1311 of the Obamacare Act authorizes individual states to establish exchanges for selling health insurance policies. The next section, namely section 1312, authorizes the federal government to establish an exchange to sell insurance in those states which do not set up their own exchange. Got that? An exchange established by the State under section 1311 cannot include the federal exchange. That federal exchange was established under section 1312 of the act.
The precedent is very clear when it comes to interpreting statutes. The Court will not rewrite a law; it will stick to the clear meaning of what was passed. Only Congress and not the Court can change the language of the act.
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