“Absurdity Of The Argument Is It’s Greatest Strength”: Republicans Know Their Obamacare Case Is Bogus; Here’s The Proof
On Thursday, the government filed its brief to the Supreme Court in the case that will determine whether Obamacare subsidies disappear in three dozen states. Its argument is comprehensive, but one part of it speaks directly to the political history of the law, and the fact that everybody, including Republicans in Congress who now claim out of convenience that the law plainly limits subsidies to states that set up their own exchanges, always understood it to authorize subsidies everywhere.
The government confines this part of its argument to the legislative debate in the run up to the law’s passage in early 2010, but it could make the point more succinctly (and perhaps convincingly) by fast forwarding to early 2011. These days, Republicans up to and including Senate Majority Leader Mitch McConnell confidently pronounce that “the language of the law says … subsidies are only available for states that set up state exchanges.” But that’s not what they believed four years ago.
When Republicans took over the House in 2011, the political environment in Congress changed dramatically. Obamacare couldn’t be repealed, but it became fair game for damaging modifications, and the GOP took aim at it and other domestic spending programs whenever opportunities to offset the cost of new legislation arose. One of the first things Congress did back then was eliminate an Affordable Care Act provision that would have significantly expanded the number of expenses businesses are required to report to the IRS. Even before the law passed, business associations were livid about the “1099” requirement, and created such an uproar over it that the question quickly became how, not if, it would be repealed. Even Democrats wanted it gone.
The only problem was that the reporting requirement was expected to raise over $20 billion. Under GOP rule, it could only be offset with spending cuts elsewhere in the budget. As it happens, they found those spending cuts elsewhere in the ACA itself. Specifically, Republicans paid for repealing the 1099 provision by subjecting ACA beneficiaries to stricter rules regarding when they have to reimburse the government for subsidy overpayments. Make more money than you anticipated, and the government will claw back your premium assistance come tax season.
The congressional budget office scored the plan as essentially deficit neutral, and Republicans voted for it overwhelmingly. But you see the problem here. If the ACA plainly prohibits subsidies in states that didn’t set up their own exchanges, then there would be no subsidies in those states to claw back. And by April 2011, when the clawback passed, we already knew that multiple states were planning to protest ACA implementation and let the federal government set up their exchanges, including giant states like Florida, which now has a million beneficiaries. They would have needed a different, or additional, pay-for.
Obamacare’s legal challengers might chime in here to insist that their case is impervious to revelations like these. CBO’s analyses were premised on the idea that every state would set up its own exchange, and Republicans (and many Democrats) based their votes on what CBO told them. Other Democrats who actually understood the scheme may have simply pretended not to notice the problem. Nevertheless, they’d say, the law was designed to withhold subsidies from people whose states didn’t establish exchanges, and to ruin the individual and small-group insurance markets in those states, without providing any notice to either. In a perverse way, the absurdity of the challengers’ argument is it’s greatest strength. Because the scheme they insist Congress intentionally created was so far from Congress’ mind, it’s hard to find contemporaneous evidence that Congress absolutely didn’t mean to condition these subsidies. In much the same way, we can’t be sure that Congress didn’t mean to denominate those subsidies in Canadian dollars. A $ isn’t necessarily a $ after all.
But this familiar line of defense crumbles here. It is facially plausible—though incorrect—to posit that at the time the law passed, CBO believed subsidies would be available everywhere because it simply assumed every state would set up an exchange. But that assumption didn’t hold in April 2011. Something else must explain CBO’s 1099-repeal score, and the Republican votes that followed it. What we have in the form of this bill is clear evidence that everyone who voted for it (including every single Republican, save the two GOP congressmen and one GOP senator who weren’t present) understood the Affordable Care Act to provide subsidies everywhere.
Congress repealed the 1099 provision at an important moment—after multiple states announced that they would step back and let the federal government establish their exchanges, but before the IRS issued its proposed rule stipulating that subsidies would be available on both exchanges. The only thing Congress had to go on when it stiffened the clawback mechanism was its own reading of the Affordable Care Act, and Congress behaved exactly as you would expect. It operated with the understanding that subsidies were universal.
Today, many Republicans will tell you that the law plainly forecloses subsidies through the federal exchange. Six senators—John Cornyn, Ted Cruz, Orrin Hatch, Mike Lee, Rob Portman, and Marco Rubio—and nine congressmen—Marsha Blackburn, Dave Camp, Randy Hultgren, Darrell Issa, Pete Olson, Joe Pitts, Pete Roskam, Paul Ryan and Fred Upton—have even filed an amicus brief with the Supreme Court, which begins, “The plain text of the ACA reflects a specific choice by Congress to make health insurance premium subsidies available only to those who purchase insurance from ‘an Exchange established by the State….’ The IRS flouted this unambiguous statutory limitation, promulgating regulations that make subsidies available for insurance purchased not only through exchanges established by the States but also through exchanges established by the federal government.”
All of them, save Cruz, who was elected in 2012, voted for 1099 repeal.
In its brief, the government argues that “it was well understood that the Act gave ‘States the choice to participate in the exchanges themselves or, if they do not choose to do so, to allow the Federal Government to set up the exchanges.’ And it was abundantly clear that some States would not establish their own Exchanges.“ It was more than well understood. Congress actually endorsed that very proposition.
By: Brian Beutler, The New Republic, January 23, 2015
One of my favorite factoids from the 2012 presidential race emerged when Mitt Romney released his 2011 tax return. There may not have been much scandalous contained therein, but Romney’s sources of income were so varied and intricate that the return ran to a mind-boggling 379 pages. And it’s starting to appear that Jeb Bush may have a similarly complex financial life, which he’s starting to unravel as he prepares for a potential presidential run. There’s one particularly interesting source of income, as this article in the Los Angeles Times explains:
And on Wednesday, Bush resigned from the board of directors of Tenet Healthcare Corp., also effective Dec. 31, according to a corporate filing. The Dallas-based company actively supported the 2010 Affordable Care Act, and has seen its revenue rise from it, an issue that could draw fire in Republican primaries.
Bush earned cash and stock awards worth nearly $300,000 from Tenet in 2013, according to corporate filings. He also sold Tenet stock worth $1.1 million that year, the records show.
If it’s like other big corporations, the services for which he was paid $300,000 by Tenet probably involved little more than going to a couple of meetings every year. It’s good to be a Bush. But let’s try to imagine the fire he might draw in the primaries over his association with the company. Are politicians from the party of capitalism and business really going to criticize him for making a ton of money, even if it involved the hated Affordable Care Act?
Yeah, they probably will. Which raises the question of exactly how the 2016 GOP candidates are going to address the ACA, which even as it becomes further embedded in our health-care system is still on many Republicans’ minds. Chances are they’re going to talk about it in the most general terms they can, in a discussion that stays at a symbolic level and avoids any specifics.
That’s because there are many more Americans who have a negative view of the ACA as an abstraction than there are who dislike the things it actually does. Members of the public are about evenly split when you just ask them what they think of the law. (In the latest Kaiser Family Foundation poll, 45 percent say we should move forward with the law or expand it, while 43 percent say scale it back or repeal it.) But with the exception of the individual mandate to acquire coverage, the specific provisions of the law are all supported by strong majorities. Even majorities of Republicans support elements such as the creation of the exchanges, the expansion of Medicaid and the provision of subsidies to help people afford insurance.
So if you’re a Republican candidate, you have to seek safe harbor on the terrain of the general and symbolic. Otherwise, you’d end up like Mitch McConnell did during the last campaign, insisting that while he wanted to repeal the ACA “root and branch,” he also wanted to keep almost everything the law does.
At the moment, lots of Republicans remain psychologically trapped in the days right after the problematic rollout of Healthcare.gov convinced them all that the ACA would collapse in a matter of weeks or months. At the time, they could barely contain their glee. As Ramesh Ponnuru and Yuval Levin — widely considered two of the more sober conservatives on issues like these — wrote at the time, “As ObamaCare’s failures and victims mount by the day, Republicans have so far mostly been watching in amazement. They expected the law to fail, but even among its most ardent opponents few imagined the scale and speed of the fiasco.”
Even if that was your honest assessment back then, you’d have to be in the grips of a nearly psychotic level of denial to believe it today. Every result of the law may not be perfect, but it has been an overwhelming success. Just about every prediction Republicans made has turned out false. The economy hasn’t tanked, 10 million people were newly insured even before this year’s open enrollment, premium increases are slowing, overall health costs are slowing, and conservatives looking for specific evidence of the law’s failure don’t quite know what to say.
So criticizing something like the fact that one of your opponents sat on the board of a company that benefited from the ACA offers a way to tell voters that you still hate Obamacare with every fiber of your being — and that opponent obviously doesn’t — without having to talk about what the law has accomplished.
Now let’s imagine something fanciful. What if one of the GOP candidates said something like this:
I opposed Obamacare. I wish it had never passed. But now it has been implemented, and just repealing the whole thing isn’t an option anymore. Too many people are now on either Medicaid or plans they got through the exchanges, and it would be wrong to just toss them off their coverage. And there are some things in the law that both conservatives and liberals support. So here’s a plan to keep what’s right about it and fix what’s wrong about it.
We all assume that if a candidate said that, he’d be condemned by his opponents as a traitor and all Republican voters would turn against him. The former would certainly occur, but the latter might not. He might be able to pull the other candidates into a discussion about the specifics of the law, where — if he were the only one with a plan actually grounded in the real world — he could win the argument.
But the truth is, that’s not too likely. If Romney, whose Massachusetts health insurance reform provided the model for the ACA, could win the nomination just shaking his fist at President Obama and insisting that his reform was nothing like Obama’s — which not a single person, Republican or Democrat, actually believed — then why take that chance? If you’re Jeb Bush, you can leave the board of Tenet and repeat over and over that your loathing for the ACA is as strong as anybody’s. In the primaries at least, that will probably be enough to neutralize the issue.
By: Paul Waldman, Contributing Editor, The American Prospect; Contributing Writer, The Plum Line Blog, The Washington Post, December 26, 2014
I’ve been saying for a while now that Republicans could be in a jam if the U.S. Supreme Court announces a decision in June invalidating the insurance premium subsidies for people living in the 36 states utilizing federally establishment exchanges under Obamacare, if only because the immediate impulse of rank-and-file conservatives will be to dance and sing even as millions are in danger of losing affordable health care coverage.
Perhaps behind the scenes conservatives are beginning to plan an education campaign to explain to The Troops via Fox News or other “trusted” sources why they can’t just let the subsidies die. Last week I noted that Ramesh Ponnuru had begun talking about Republicans agreeing to fix the subsidy problem while pivoting (presumably as part of some national “deal”) rapidly to an Obamacare “replacement.” But he didn’t sound terribly confident about selling this strategy to the GOP. Since we’re unlikely to find out where SCOTUS is going until June, there is time for sober reflection on the consequences of taking away the subsidies among a constituency that’s a lot more likely to include a lot of Republican voters than the subjects of a Medicaid expansion. The question is whether it can be effectively and quickly communicated to people who have been told since 2010 that the Affordable Care Act is the work of the devil.
Now one of Ramesh’s reformicon colleagues from National Review, Yuval Levin, has (with his collaborator on one of hte Obamacare “replacement” proposals, James Capretta) written a careful message to conservatives via the Wall Street Journal suggesting they get ahead of the curve:
In essence, if the court rules today’s subsidies illegal, those state officials could face a choice between creating a state exchange (and so reinforcing ObamaCare) or seeing some residents lose coverage they now have. ObamaCare’s opponents in Congress should give them a third option: a viable alternative to the Affordable Care Act.
The first step is to introduce legislation that would allow any state to opt out of all of ObamaCare’s mandates, regulations, taxes and requirements, and instead opt into a far simpler and more flexible alternative system. In that system, state residents not offered health coverage by their employers could receive a federally funded, age-based credit for the purchase of any state-approved health-insurance product—including those bought outside of any exchange and regardless of whether they meet ObamaCare’s coverage requirements.
Anyone who remains continuously insured in this system would be shielded from higher premiums or exclusions from coverage based on an existing condition. This would give consumers a strong incentive to buy coverage without a mandate to do so. All other insurance regulation, however, would happen at the state level.
States that opt for this approach would also be permitted to transform their Medicaid programs into premium-support systems for lower-income households. These would function as add-ons to the credit and allow eligible residents to buy the same kind of coverage everyone else can purchase.
The credit could be large enough to allow anyone to purchase at least catastrophic coverage—enabling the uninsured to be covered and everyone to be protected from the most extreme health expenses. Alternatively, it could be used to supplement the purchase of more comprehensive coverage. In essence, the credit would extend to everyone else the same benefit that many people have long received in the employer system. It would do so without disrupting the employer system, the coverage most Americans have.
What they are describing is pretty much the Burr-Coburn-Hatch “PCARE” proposal offered early this year as a suggested Obamacare “replacement,” with some transitional rules that would let Obamacare subsidies stay in place through the end of 2015. And they think Obama would be forced to accept something like this “solution” since otherwise he, not Republicans, will look like the one standing in the way of restored insurance for the people afflicted by the Court.
It’s all pretty clever, but a comment from Ponnuru shows its central flaw:
My only quibble is with the headline, “Time to Start Prepping ObamaCare Reforms.” What they’re talking about is better described as preparing an exit ramp from Obamacare.
Reforms, “exit ramp,” whatever. Such terms are meant to obscure the fact that such plans would keep Obamacare in place until such time as a new system could be implemented–again, before “the base” can make it all moot by forcing GOP policymakers to celebrate the carnage instead of repairing it. And if I know that and you know that, so too would the president, and I think it’s very predictable that well before congressional Republicans could be united behind such a proposal Obama would let them know the only non-disruptive course of action is to restore the intended subsidy system and then talk about what’s next. Pretending they’ve come to the rescue of people in danger of losing their health insurance by eliminating all the provisions that make it good coverage at an affordable price isn’t likely to work. But nice try.
By: Ed Kilgore, Contributing Writer, Political Animal, The Washington Monthly, December 19, 2014
Back in March 2011, when the biggest threats facing Obamacare were the Supreme Court and the 2012 elections, I argued that the demise of the Affordable Care Act would put people’s lives in immediate danger.
At the time, the law had relatively few beneficiaries—people under 26 covered by their parents’ health plans, a small population of people with pre-existing medical conditions. But some of them had already used their new coverage to finance the kinds of life-saving treatments that would leave them in need of chronic care for the rest of their lives. Take away the health law, and most of these organ transplant recipients and other patients would have become unable to afford their medications, and some of them would die.
Since then, millions of people have gained coverage under the law, and that group of chronic care patients has grown much larger. But despite the fact that the Court upheld the law, and President Obama won reelection, the ACA isn’t out of danger.
On Friday, the Supreme Court agreed to hear a case that will determine whether the federal government can continue to subsidize private ACA coverage in states that didn’t set up their own insurance exchanges.
That case is King v. Burwell, but the issue at stake has come to be defined by a comparable case called Halbig v. Burwell.
The Fourth Circuit Court of Appeals ruled against the challengers in King, but the Supreme Court agreed to grant cert to those challengers anyhow, despite the absence of a Circuit Court split. If the five conservative Supreme Court justices are so inclined, they can void ACA subsidies for millions of beneficiaries, and cripple the insurance markets in about three dozen states.
Some of those beneficiaries will be the kinds of transplant recipients and other patients I wrote about three and a half years ago. Except today there are many more of them. Several of these patients explained the risk to their lives in an amicus brief, urging a different circuit court to reject the challenge to the subsidies, and thus to the viability of the insurance markets their lives depend on.
“Without insurance, Jennifer [Causor’s] treatments would be completely unaffordable. Her transplant cost nearly $280,000. She takes three anti-rejection drugs, one of which has a sticker price of $2,400 per month…. Should she become uninsured, Jennifer would face bankruptcy and even death.”
You can read the whole brief below. Conservatives are brimming with excitement over the Court’s decision to hear the challenge. Should the five conservatives rule that the text of the law doesn’t provide for federal subsidies in states that didn’t set up their own exchanges, they’ll place the onus on Congress or state governments to address the consequences for constituents who lose their benefits. The contested text could be fixed with a comically simple technical corrections bill, which Democrats would happily support. If Republicans were to sit on their hands, or use the ensuing chaos as leverage to extract unrelated concessions, it will cost people their lives. That is a cardinal reality facing justices, and the people soliciting their conservative activism.
There’s an ironic post-script to this article. The Supreme Court is likely to resolve this case with a 5-4 decision, one way or another. Either a single conservative will side with the Court’s four liberals as in 2012, and leave the law unscathed, or the five conservatives will align to void the subsidies.
Under the circumstances, supporters of the law might be nervous about the potential loss of a liberal justice. Ruth Bader Ginsburg’s health and advanced age make many liberals very uneasy, especially now that Obama’s ability to fill Supreme Court vacancies has come into doubt. But for the purposes of King, this issue is immaterial.
If Ginsburg’s seat were to become vacant, then the fate of the law would remain in the hands of a conservative swing justice. A 4-4 split effectively upholds the lower court’s ruling—and since the Fourth Circuit upheld the subsidies, the subsidies would stand. If the Fourth Circuit had ruled the other way, her health would be much more material.
When I mentioned this admittedly morbid but nevertheless important curiosity on Twitter, a large number of dimwitted (or in some cases persistently dishonest) conservatives flooded my mentions column in outrage. Most of them missed the meaning altogether, and accused me of wishing death upon a conservative Supreme Court justice. But even the ones who didn’t managed to contain their enthusiasm over the possibility of millions of people losing insurance for a moment, to reprimand me for being so cavalier about people’s lives.
By: Brian Beutler, The New Republic, November 7, 2014
“Obamacare Is Here To Stay”: Kentucky Is Emblematic Of The States That Have Received Substantial Assists From Obamacare
You’ve heard of Obamacare, right?
It’s that disastrous, costly and intrusive policy that President Obama and his fellow Democrats rammed down the throats of Congress back in 2010 — a failed plan that conservative Republicans have pledged to “repeal and replace.” According to its critics, it is un-American; it destroys the health care system; it burdens businesses; it hollows out Medicare. Right?
Ah, wrong. Despite what you may have heard and despite the caprice of electoral campaigns, the changes wrought by the Affordable Care Act are here to stay. That’s because it accomplishes much of what it set out to do — and its beneficiaries mostly like it.
Don’t expect Republicans to try to turn back the clock. Oh, some of them will continue to bash Obamacare and to blame it for any negative effects on the country’s dysfunctional health care “system” — including rising costs. And some will even go so far as to continue to insist that it ought to be repealed.
Take Senate Minority Leader Mitch McConnell, who expects to lead the upper chamber if Republicans claim a majority. In a debate last month with his Democratic rival, Alison Grimes, McConnell suggested that he would repeal the Affordable Care Act but leave in place Kentucky’s popular state exchange program.
“… The best interest of the country would be achieved by pulling out Obamacare, root and branch,” he said. “Now, with regard to Kynect, it’s a state exchange. They can continue it if they’d like to.”
McConnell’s pronouncement was a tour de force of dissembling, a virtuoso performance of fabrications and disinformation. The Washington Post’s fact checker awarded him three Pinocchios.
That’s because the state’s health care exchange, Kynect, is a part of Obamacare, made possible by the 2010 law. If Obamacare is ripped out “root and branch,” the state exchanges could not continue to exist. (The GOP has continually pledged to find a mechanism to replace Obamacare, but its warring factions have failed to agree on any plan that would leave state exchanges in place.)
Here’s the rub: Kynect is very popular with Kentucky’s residents, many of whom are enjoying health insurance for the first time in their lives. They have been primed by Republican politicians to hate the president and any policy he endorses — including his signature health care plan — but they don’t want to give up Obamacare’s benefits.
Kentucky is emblematic of the states that have received substantial assists from Obamacare. It is largely rural and is among the poorest states. It has also long ranked near the bottom in several health indicators, including obesity and smoking rates and cancer deaths. Obamacare has been a boon for its residents, cutting the rate of uninsured in half.
According to The New York Times, people who live in rural areas are among the biggest winners from the Affordable Care Act. Other groups who have reaped substantial benefits are blacks, Latinos, women and younger Americans between 18 and 34.
Here’s another reason that Obamacare is here to stay: Its expansion of Medicaid is a boon to the states that have taken advantage of it. After the Supreme Court ruled that Medicaid expansion was optional, most Republican governors vowed to resist it — even though the federal government will pay 100 percent of the cost for the first three years and 90 percent thereafter.
But some of those GOP governors are now having second thoughts as rural hospitals are forced to close down for lack of funds and poor people are sidelined by preventable illnesses. Several GOP governors have already expanded Medicaid — which provides health insurance for the poor — and others are considering doing so.
Last month, Ohio’s Republican governor, John Kasich, advised his GOP colleagues to stop fighting the Medicaid expansion. The opposition, he said, “was really either political or ideological. I don’t think that holds water against real flesh and blood, and real improvements in people’s lives.”
Some Republicans have trouble admitting that on the campaign trail, but they all know it’s true.
By: Cynthia Tucker, The National Memo, November 1, 2014