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Sunday, March 1, 2015

King v. Burwell

Sunday morning is when I take time to read the New York Times. My attention was brought to an Op-ed piece entitled "The phoney legal attack on health care". The title of the piece is erroneous on its face. The case is about the ACA, but this imprecise use of terms appears to be indicative of a broader view of language in general which may provide some insight into the perspective on this specific case. The question is whether imprecise words matter or don't they?

As the editorial board explicitly states:
In the long, tangled history of the debate over the Affordable Care Act, no member of Congress ever indicated a belief that the law would work this way. To the contrary, the law explicitly provides for “quality, affordable health care for all Americans.”
Yes, we all know what the intentions of the drafters of the legislation was, but if all that matters is intentions, why go to the bother of drafting anything more? Why not leave it the hands of the legions of well intended people who will ultimately be charged with making the magic happen and we will leave it at their discretion as to how to operationalize this.

The Op-ed piece today was pretty much a hit man piece, basically an indignant diatribe predicated on the assumption that this case could simply not be worthy of any merit and if anyone gave it any degree of greater reflection it would be sign that you  were simply a moron or some tool of right wing fanaticism (or both).  I guess this is what I should expect from the Op-ed page of the Times. It was the Times and it was the Op-Ed page.

Finding a more balanced view became my quest for the morning. It was not particularly easy. However, I did find a piece published in Vox in November 2014 which looked at the arguments which have been presented and will likely be presented  (King v. Burwell). In my reading of this there were two key points about the crafting of the legislation which seemed to be important. First, the way this bill became law, through an unconventional budgetary process, meant that it never went to conference committee where inconsistencies between House and Senate versions get cleaned up. The House version pushed a Federal Exchange while the Senate pushed the state exchanges. The original architects of the bill initially acknowledged that the inconsistencies may have been a product of the path to approval. However, they subsequently backtracked on this clam.

The actual language of the statute (the "four words") are pretty unambiguous that subsidies are linked to section 1311, which describes only state-based exchanges. It does not reference section 1321, which sets up the federal exchanges. Whether that was the intent is dependent on who you ask and when you asked them. However, there is no question as to how the actual law is written.There were all sorts of heated discussions regarding other subsidies during the actual debate before passage. There was reportedly no discussion prior to approval of the bill of the state v. federal exchanges and whether subsidies would be available to to specific state run exchanges only.

There has been all sorts of strident speech regarding the Roberts Court and in particular Justice Roberts relating to this case. First, there has been indignation regarding why they chose to even hear this and whether the plaintiffs had standing. Regarding the latter point, I simply don't have sufficient insight to have an informed opinion on the standing issue. Perhaps at the 11th hour the case will evaporate because of lack of standing. It would be convenient and take the Supreme Court off the hook for now. However, assuming the plaintiffs have standing, it would be hard to imagine that the Court could avoid hearing this case.

I can't help but think of Justice Roberts and how he handled the last challenge to the ACA. Through what best can be characterized and legal gymnastics he converted a mandate to purchase a commercial product into a tax, even though the word tax was not written into the legislation. He went to rather extreme lengths to accommodate the intent of the legislative and executive branches of government. I can't help but assume that this case will bring a similar decision. I cannot imagine that the Roberts Court, and particularly Justice Roberts, wants to have the acute consequences of an unconstitutional ruling on their plate. Furthermore, the legal and linguistic twisting involved in this case is no more convoluted that the previous challenge.

I suspect that in the long run this case will have limited impact because the real impact of the ACA will not be through the public exchanges. These will remain at the margins of the health insurance industry. The big story will be the private exchanges which will likely grow at a much faster rate and will dwarf the public exchanges. The ACA stipulated that subsidies and perhaps tax advantages will accrue to those in the public exchanges. With the explosion of private exchanges and movement of employee health insurance of Fortune 500 companies to these exchanges, there is going to be huge pressure to equalize the tax advantages across these products. It may be that this transition is going to continue and accelerate no matter how the case is decided. US business wants to get out of the provision of health insurance benefits.

One of the great ironies of the ACA is it appears to have spurred the development of private health insurance markets which will disrupt our current employer based model and perhaps inject price sanity into what is an otherwise crazy system. I don't suspect that this was not the intent of those who drafted the legislation but perhaps it will be the salvation of the health insurance market. Those on the far left and far right yearn for a collapse of the ACA so they can push to usher in their respective alternative solutions (single payer v. non-governmental). Will the Supreme's be contemplating all of this when they review King v. Burwell? I suspect so but if they are smart, they will decide on the most narrow of terms.








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