Tag Archives: King v. Burwell

ACA Legal Challenge, Part 3

affordable_care_act

Just two weeks ago I wrote about the Supreme Court’s ruling that upheld nationwide federal subsidies and preserved the Affordable Care Act.  In my closing paragraph I said that the legal challenges now seem to be exhausted and its time that we accept the ACA and move on.  Personally, I am not a fan of the massive health care reform law but as a businessman and insurance professional I’m growing weary of the uncertainty surrounding the law.  Well, as it turns out, I was wrong about King v. Burwell being the final judicial word on the ACA.

There looms another potential judicial dagger aimed at the heart of the ACA in the lesser-publicized case of Sissel v. HHS.  The case lost at the D.C. Circuit when the three-judge panel applied logic that resembled a mental version of the game “Twister.” The plaintiffs are now seeking an en banc review of the case at the D.C. Circuit, and the next stop could be the Supreme Court.  [sigh] Here we go again.  What is an insurance professional attempting to help their clients with health insurance and benefit plans to do?

At its core, Sissel’s argument is that the ACA violates the Origination Clause of the Constitution which requires that all taxation bills must originate in the House of Representatives.  In the murky legislative mechanics that gave us the ACA, the bill originated in the Senate.  When the original 2012 Supreme Court (SCOTUS) ruling came down, it upheld the individual mandate because SCOTUS ruled that the monetary penalty for not purchasing health insurance was actually a tax.  Chief Justice John Roberts took a lot of heat for that tortured legal conclusion, just as he did for last month’s interpretation of the law’s language regarding subsidies.  The two milestone SCOTUS rulings on the ACA have seemed to give incredible deference to the ACA and its intentions, more than its language.

If Sissel v. HHS makes it to the SCOTUS in the near future, things will get very interesting.  The biggest problem for SCOTUS is that its 2012 ruling that proclaimed the ACA’s penalities to be taxes now gives Sissel an opening to challenge the entire law as a violation of the Constitution’s Origination Clause.  On its face, I wonder how Chief Justice Roberts will reconcile what appears to be a slam dunk argument.  How can SCOTUS possibly rule that the law includes taxes as the justification for upholding the individual mandate, and then not rule the entire law to be unconstitutional on the grounds that it violated the Origination Clause?

What happens next will be very interesting.  SCOTUS could refuse to take up the case and let the D.C. Circuit’s ruling against Sissel stand.  The problem with that is that the D.C. Circuit’s ruling essentially obliterates the Origination Clause, and SCOTUS may not be able to stomach that precedent.  If SCOTUS does take up the case, all bets are off.  Personally, I thought the plain language at the core of the issue in King v. Burwell was a slam dunk and I was wrong.  I am actually somewhat intrigued by the notion of a trifecta ruling in favor of the ACA and especially the judicial acrobatics that would most certainly come out of such a ruling on Sissel v. HHS.

I can anticipate a few such legal gyrations… SCOTUS might rule that the ACA bill did actually originate in the House because there was some monkey-business with “empty shell” bills from the House that were filled with the ACA language by the Senate.  That’s a political game that the nation’s Founders certainly did not intend but SCOTUS seems to be willing to give more weight to certain intentions than others these days (see King v. Burwell).  Another way out could be to somehow massage the D.C. Circuit’s logic that declared the ACA’s taxes were not intended to raise revenue but to expand health insurance.  So the ACA included a tax in order to uphold the individual mandate but it’s not a tax in the sense that it is not a revenue-raising bill that must originate in the House.  Huh?  What is a tax if not a means for government to raise revenue?  Good luck John Roberts.

One thing is certain… I do not envy my insurance industry colleagues who specialize in the health insurance market these days.  Does the ACA cover whiplash?

 

Affordable Care Act Survives (Again)

affordable_care_act

The U.S. Supreme Court has spoken on the highly anticipated King v. Burwell case.  Subsidies are legal in all 50 states, rather than only in the states with their own insurance exchanges.  The political debate continues and the Justices will receive criticism/praise (depending on one’s personal viewpoint) for having upheld the universal subsidies implementation of the ACA law.  This ruling seems to contradict the plain language of the law and the evidence that the language was intentionally written as it was to coerce the states into setting up exchanges.

Ironically, the Supreme Court found in 2012 that the federal government could not coerce the States into expanding their Medicaid programs under the ACA.  I can’t help but wonder if that specific ruling played into the Court’s ruling on King v. Burwell.  Stay with me… If the court had found that the plain meaning of the ACA language and the evidence (as provided by Gruber) suggested that subsidies were limited only to States setting up their own exchanges, then the Court would have to say that the federal government was once again attempting to coerce the States.  And since it already ruled once that the federal government could not coerce the States on Medicaid expansion, would it not then have to say that the subsidy/exchange coercion is also illegal and thereby throw out the subsidies entirely… in all 50 states regardless of exchanges?

If you follow and buy into my logic, then the Supreme Court Justices (most notably Chief Justice Roberts and swing vote Kennedy) were choosing between upholding the imperfect law as is, or a significant rebuke of the ACA’s subsidy system that would have left them with a glaring inconsistency with their 2012 ruling on Medicaid expansion, or a complete destruction of the ACA law by revoking all subsidies.  Given those choices, I’m not surprised that Roberts and Kennedy chose the first option.  The SCOTUS is not supposed to be political or partisan, but they are human.  I don’t believe that Roberts and Kennedy were comfortable with any of the choices other than upholding the subsidies, despite the statutory language and clear intent of the law’s architects.

Another effect of this ruling could be a further centralization of the U.S. health care system at the federal government level – an outcome that is likely fine with the Obama administration’s single-payer acolytes.  The New York Times suggested that the ruling removes a primary reason for States to establish and operate health care insurance exchanges, so many States may just let the Feds takeover the entire process.  Another bit of irony since that reasoning further supports the notion that the law’s intention was indeed to condition subsidies on State-run exchanges.

The political battle over the ACA will continue for years to come.  For now though, the significant legal challenges that might upend the law seem to be exhausted.  From an insurance perspective, it seems to me that it’s time we all accept the ACA as settled law, for good or for bad, and figure out how to best live with it.  And if you happen to believe that the law includes provisions supporting “death panels” then this may be easier said than done.