Under Obamacare, those who don’t have health insurance coverage at work sign up for policies at online “exchanges.” If their income level makes the policies too hard to afford, the government will offer subsidies to make up the difference. There is a problem, though. As the law is written, the subsidies are for people who signed up for a plan on an exchange “established by the state.” Thirty-four states refused to set up the exchanges, which send applicants to a federal exchange. Technically, applicants from those 34 states would not seem to be eligible for a subsidy.
But wait, you may say. That is obviously just a technicality. The clear intent of the law offers subsidies to everybody eligible. Except that the legislative history of the bill shows good evidence that the “established by the state” language was put in precisely for the purpose of pressuring states to start their own exchanges.
Now this is being litigated, with several lawsuits against the IRS, which has been tasked with enforcing Obamacare. (That is surely a misuse of that agency, but that’s what we get when the Supreme Court defines penalties and fines as “taxes.”)
But here is the point: Even people who support some program that would provide universal healthcare should surely admit that Obamacare is not a very good way of reaching that goal, that the Affordable Care Act is too complicated, was poorly written, was passed too quickly without normal legislative scrutiny, and has too many unintended consequences.Let George Will explain it. From Four words in the ACA could spell its doom – The Washington Post:
The four words that threaten disaster for the ACA say the subsidies shall be available to persons who purchase health insurance in an exchange “established by the state.” But 34 states have chosen not to establish exchanges.
So the IRS, which is charged with enforcing the ACA, has ridden to the rescue of Barack Obama’s pride and joy. Taking time off from writing regulations to restrict the political speech of Obama’s critics, the IRS has said, with its breezy indifference to legality, that subsidies shall also be dispensed to those who purchase insurance through federal exchanges the government has established in those 34 states. Pruitt is challenging the IRS in the U.S. District Court for the Eastern District of Oklahoma, and there are similar challenges in Indiana, Virginia and Washington, D.C.
The IRS says its “interpretation” — it actually is a revision — of the law is “consistent with,” and justified by, the “structure of” the ACA. The IRS means that without its rule, the ACA would be unworkable and that Congress could not have meant to allow this. The ACA’s legislative history, however, demonstrates that Congress clearly — and, one might say, with malice aforethought — wanted subsidies available only through state exchanges.
Some have suggested that the language limiting subsidies to state-run exchanges is a drafting error. Well.
Some of the ACA’s myriad defects do reflect its slapdash enactment, which presaged its chaotic implementation. But the four potentially lethal words were carefully considered and express Congress’s intent.
Congress made subsidies available only through state exchanges as a means of coercing states into setting up exchanges.
[Keep reading. . .]
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