Secretary of Health and Human Services Sylvia Burwell appeared at a hearing before the Senate Finance Committee Wednesday morning, where she was promptly confronted with questions about a lawsuit seeking to gut much of the Affordable Care Act. Immediately after Burwell completed her opening statement, committee chairman Orrin Hatch (R-UT) asked a series of questions about King v. Burwell, a lawsuit claiming that tax subsidies that are intended to help people pay for health insurance are not available in states that elected to have the federal government set up a health exchange within their state. The interpretation of Obamacare offered by Hatch during the hearing, however, is at odds with Hatch’s own reading of the law when it was being debated in Congress.
During the hearing, Hatch claimed that the language of the Affordable Care Act “is unambiguous, in my opinion,” and that it unambiguously denies subsidies to people unfortunate enough to live in the wrong state. Yet, in January of 2010 — long before it became advantageous for Republicans to bolster the arguments being made against the law in the Supreme Court — Hatch co-authored an op-ed in the Wall Street Journal which took the opposite view. In that op-ed, Hatch explained that a state’s decision to set up its own exchange, as opposed to allowing the federal government to do this work for them, “is not a condition for receiving federal funds, which would still leave some kind of choice to the states.”
Secretary Burwell, for her part, reiterated the Obama Administration’s understanding of the law, which is the same as Senator Hatch’s position in 2010.
The King case turns upon whether a handful of words in the Affordable Care Act may be read out of context to support Hatch’s more recent position on the law, or whether those words should be read in context — a reading that supports Hatch’s position in 2010. Although a provision of the law appears to suggest that subsidies are only available to people who purchased a health plan “through an Exchange established by the State,” other provisions of the law define the term “Exchange established by the State” expansively to include exchanges operated by the federal government.
In addition to endorsing an interpretation of Obamacare that reads one small part of the law out of context, Hatch also offered a theory for why Congress might have chosen to strip an important benefit for people who live in the wrong states. According to Hatch, “there’s a lot of indication” that Congress intended to make subsidies contingent upon states setting up their own exchanges “so that it would force the states to have to form the state exchanges rather than have the federal government do it for them.”
Yet, despite Hatch’s claim that “there is a lot of indication” supporting this view of the law, Hatch offered no evidence whatsoever in support of this position, and the plaintiffs in the King case have been unable to offer any evidence supporting this understanding of Congress’s motives either.
In their brief asking the Supreme Court to take health care away from millions of people, the King plaintiffs claim that former Senator Ben Nelson (D-NE) insisted that subsidies be cut off in states with federally-run exchanges in order to use the threat of lost subsidies to “induce . . . state participation.” The King plaintiffs, however, offer no real evidence suggesting that Nelson made such a demand. Instead, they cite a short Politico article reporting on an irrelevant debate over whether the law would create a single nationwide exchange or multiple state-based exchanges for each of the 50 states. Nelson believed that there should be many state-based exchanges, rather than one national exchange, but he never claimed that subsidies should be cut off in states with federally-run exchanges.
Last week, Nelson himself explained that he absolutely did not shape the law in the way that the King plaintiffs say that he did. In a letter to Senator Bob Casey (D-PA), who sought his views on the matter, Nelson explained that “I always believed that tax credits should be available in all 50 states regardless of who built the exchange, and the final law also reflects that belief as well.”