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Four Giant Problems With The Supreme Court Case Against Obamacare

CREDIT: AP PHOTO/PABLO MARTINEZ MONSIVAIS
CREDIT: AP PHOTO/PABLO MARTINEZ MONSIVAIS

Sometime within the next two weeks, the Supreme Court will reveal whether it will take health care away from millions of people at the request of the conservative attorneys behind a case known as King v. Burwell. The premise of the King plaintiffs’ arguments is that most of the text of the Affordable Care Act does not count. Instead, they claim, a single sentence of the law must be plucked out of context which, if read entirely in isolation, seems to suggest that tax credits which enable millions of people to afford health insurance should be cut off in approximately three dozen states.

This is not how laws are supposed to be interpreted. To the contrary, as Justice Antonin Scalia explained in a 2014 opinion of the Court, there is a “fundamental canon of statutory construction that the words of a statute must be read in their context and with a view to their place in the overall statutory scheme.” Nor have the attorneys hoping to gut Obamacare merely asked the Supreme Court to creatively interpret the Affordable Care Act. They’ve also developed an alternative history of the law’s passage where Congress actually intended to use the threat of lost tax credits to force states to set up health insurance exchanges, rather than having the federal government operate exchanges in those states.

The details of this alternative history have not fared well in the face of scrutiny, however. Here are a few examples of claims made by the attorneys behind King v. Burwell that have since been revealed as false:

The Myth of Ben Nelson

The King plaintiffs’ central claim is that Congress considered the question of whether state or federal bureaucrats would operate the Affordable Care Act’s health exchanges to be a matter of such superseding importance that they were willing to deny health care to millions of people — and potentially toss numerous states’ health insurance markets into a catastrophic “death spiral” — in order to ensure that only state officials operated these exchanges. According to the plaintiffs’ brief, former Senator Ben Nelson (D-NE), as well as some unnamed “other senators,” insisted that the law be designed this way because “it was important to keep the federal government out of the process, and thus insufficient to merely allow states the option to establish Exchanges.”

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Their brief offers no support for this claim, however, beyond a citation to a 2010 Politico article that does not actually bolster their claim at all. The claim was also repudiated by Senator Nelson himself, who wrote in a letter to Senator Bob Casey (D-PA) 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.”

The Letter That Was Literally A Joke

Shortly after oral arguments in King, Michael Carvin, the lead attorney for the King plaintiffs, spoke on a panel sponsored by the insurance industry group America’s Health Insurance Plans. During this panel, he claimed that he had uncovered a letter sent by state officials asking the federal Department of Health and Human Services to identify the legal authority that permits it to “administer premium tax credits” in the federally-run exchanges. Thus, Carvin claimed that this letter was proof that state officials believed that there was no legal authority permitting such credits during the implementation phase of the Affordable Care Act.

The problem with this claim, however, is that the letter Carvin cites was quite literally a joke.

The origin of the letter, according to a state official who signed it, was an onerous demand for information that federal officials sent to state governments. As a kind of practical joke, some of the state officials who received this federal demand drafted their own letter — the one Carvin cites — making a similarly long and onerous request for information from the federal government.

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It is true that this letter from the state officials does include a request for information regarding the federal government’s authority to administer tax credits, but that request was not made in earnest. Rather, as the state official who signed the letter explained to ThinkProgress, “We weren’t spoofing a letter from the Feds exactly, but we were very much spoofing their proposed documentation requirements of states that wanted to set up a state-based exchange by restating these in a form that would apply to the Feds.” He added that letter was drafted “purely to illustrate the inanity of the federal requirements — and their own inability to provide anywhere near close to the same information to the states.”

The letter Carvin sites, in other words, was a satirical act of trolling. It is not evidence that state officials doubted the legality of tax credits paid in federally-run exchanges.

Blindsiding State Officials

One legal obstacle that the King plaintiffs must overcome is that, even if the justices were to conclude that the plaintiffs’ idiosyncratic reading of the statute is correct, that reading raises serious constitutional problems if it is adopted by the Court. One of these problems is known as the clear statement doctrine.

The King plaintiffs claim that the law offers states a kind of coercive choice — set up your own health exchange or your residents will lose their share of billions of dollars worth of tax credits. Yet, as the Supreme Court explained in Pennhurst State School and Hospital v. Halderman, a state is not bound by ambiguous or uncertain conditions. “[I]f a State is unaware of the conditions or is unable to ascertain what is expected of it,” the condition is void. Moreover, as the Court explained in a subsequent case, the question of whether states are able to ascertain whether federal money comes with conditions is evaluated “from the perspective of a state official who is engaged in the process of deciding whether the State should accept . . . the obligations that go with those funds.”

Six state attorneys general who support the King plaintiffs filed a brief claiming, without evidence, that state officials were “well aware” that the Affordable Care Act “conditioned the availability of tax credits on States establishing exchanges.” Yet this claim hasn’t just been proven false, it was proven false by statements made by officials within four of the six states that these attorneys general represent.

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Nebraska Governor Dave Heineman (R), for example, explained his decision to allow the federal government to set up Nebraska’s exchange by stating that “[o]n the key issues, there is no real operational difference between a federal exchange and a state exchange.” Similarly, South Carolina Governor Nikki Haley (R) wrote that “[b]y refusing to implement state-based exchanges, the state is ceding nothing,” a statement which cannot be squared by the claim that the state was actually ceding tax credits for its residents. Lower-ranking state officials involved in Georgia and West Virginia’s exchanges made similar statements.

Additionally, multiple officials from states whose attorneys general did not sign a brief siding with the King plaintiffs also indicated that they were unaware of the supposed condition hidden within the Affordable Care Act. Former Virginia Governor Bob McDonnell (R) said that he was unaware of any “clear benefits of a state run exchange to our citizens.” While Wisconsin Governor Scott Walker (R) said that “there’s no real substantive difference between a federal exchange, or a state exchange.” A brief filed by the governors or attorneys general of 24 states the last time Obamacare was threatened by the Supreme Court said that the law “can only operate in the manner that Congress intended” if the tax credits are “intact.”

The Plaintiff Who Has No Business Being In Court

Finally, the plaintiff who lent his name to King v. Burwell, David King, appears to have no business being involved in this lawsuit as anything other than a spectator. That’s because of a doctrine known as “standing,” which requires plaintiffs to establish that they are actually hurt in some way by a law in order to challenge the law in court.

As part of their narrative explaining why they believed Mr. King did have standing to bring this suit, his attorneys told a lower court that “King is not eligible for employer- or government-sponsored health coverage that satisfies” the law’s requirement that most people either carry insurance or pay higher income taxes. Subsequent reporting, if it does not completely disprove it, at least raises a serious cloud of doubt over this claim. The Wall Street Journal reported in February that King is qualified for “medical coverage with no premiums through the Department of Veterans Affairs.” And King himself confirmed in a more recent interview with the New York Times that “he was not really worried about the outcome of the case, King v. Burwell, because as a Vietnam veteran, he has access to medical care through the Department of Veterans Affairs.”