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Supreme Court Case King v. Burwell

Supreme Court Case King v. Burwell

Update - On June 25, 2015, the Supreme Court upheld the subsidies for all Americans regardless if they bought their health insurance through a state or federal exchange.

I would like to start off this article with an honest disclosure. I am a person who truly believes that America should have a single-payer (Medicare-for-All) type health care system, that is similar to the Canadian model of health care. I believe that for-profit private health insurance companies should be put into the dustbin of American history.

Now, with that being said, if my only two choices are keeping the Affordable Care Act, and fixing what doesn't work properly, or going back to the pre-ACA individual health insurance markets; then I will choose the Affordable Care Act's individual health insurance markets every day of the week and twice on Sunday.

Sorry anti-ACA activists, but as someone who has used both the individual health insurance markets pre-ACA and post-ACA, you are simply blinded by your own partisan hatred if you are honestly suggesting that the old pre-ACA individual health insurance markets were better than the current Affordable Care Act individual health insurance markets. The old pre-ACA individual health insurance markets offered virtually no protections to individuals, which left those individuals almost completely at the mercy of the for-profit health insurance companies.

So that brings us to the real reason why we are all here and that is the Supreme Court case of King v. Burwell. The core of the case is whether or not the federal government is allowed to issue subsidies to Americans who bought health insurance through HealthCare.gov or whether those subsidies are only available to Americans who bought health insurance through a "state-based" exchange.

Yes, I know it sounds completely and utterly ridiculous, right?

So lets take a closer look at this case and what the Affordable Care Act actually says...


The Plaintiffs Arguments Against the Subsidies

Affordable Care Act Sec 36b Subsidy

The plaintiffs entire case against the subsidies being issued through Healthcare.gov relies entirely on a single 5-word phrase buried deep within the 974 pages of the Affordable Care Act law:

SEC. 36B. REFUNDABLE CREDIT FOR COVERAGE UNDER A QUALIFIED HEALTH PLAN.

"(A) the monthly premiums for such month for 1 or more qualified health plans offered in the individual market within a State which cover the taxpayer, the taxpayer's spouse, or any dependent (as defined in section 152) of the tax payer and which were enrolled in through an Exchange established by the State under 1311 of the Patient Protection and Affordable Care Act."

So what does all that mumbo jumbo actually mean? Well the plaintiffs in the King v. Burwell case are trying to argue that the phrase "Exchange established by the State" literally means that unless a State itself established a health insurance exchange, then none of the residents of that State should be allowed to receive subsidies. There are currently only 13 States that actually run their own "state-based" exchange. The other 37 states rely on HealthCare.gov to provide the health insurance marketplaces to their residents.

The plaintiffs also argue that it was actually Congress's intention all along to make the subsidies only available to the states that established their own health insurance exchanges. They argue that the federal government was using the old "carrot and stick" routine in order to get the states to comply with what the federal government really wanted them to do.

In this case, according to the plaintiffs, the government was using the access to subsidies as bait to entice the states to go along with taking on the responsiblity of setting up and running their own exchanges instead of relying on the federal government to do it for them.

So what is really the plaintiffs endgame?

The plaintiffs want the Americans in those 37 states to lose access to their subsides, thus basically destroying the entire Affordable Care Act. This is because without the subsidies about 80% of those Americans in those states probably would NOT be able to afford the Affordable Care Act's health insurance plans, and therefore they would simply drop out of the health insurance exchanges all together in those states.

Real nice huh...

Well of course trying to interpret a 974 page law using a simple 5-word phrase out of context is simply irrational, and takes away from the actual intent of the law.


The Government's Arguments For the Subsidies

Affordable Care Act Subtitle E

The first problem with the Plaintiffs argument in King v. Burwell is the actual subtitle of the section of the Affordable Care Act that the plaintiffs are relying on to make their argument.

In the highlighted image to the right you can view the entire section of text that the plaintiffs are trying to use as their main argument that subsidies are only available to Americans living in states that have an "Exchange established by the State."

The main problem with this part of the plaintiffs argument is that Subtitle E, the main subtitle of this section of the Affordbale Care Act, says something quite to the contrary of that argument:

Subtitle E - Affordable Coverage Choices for All Americans

Notice the words "All Americans" in Subtitle E. It does NOT say, Affordable Coverage for Americans Living in Certain States, it says "All Americans."

Without the subsidies many lower-middle class Americans would NOT find any health insurance plans "Affordable."

Therefore, it simply does NOT make any sense to argue that it was Congress's intention all along to deny subsidies to those lower-middle class Americans living in states that did NOT or could NOT establish their own health insurance exchanges.






Title I - Quality, Affordable Health Care for All Americans

Affordable Care Act Title I

In addition to Subtitle Section E, all one has to do is review the main table of contents of the Affordable Care Act to understand that the actual intent of Congress was to make health insurance "Affordable" to all Americans and without the subsides being available to all Americans, that goal would simply NOT be achievable:

Title I - Quality, Affordable Health Care for All Americans

Subtitle A - Immediate Improvements in Health Care Coverage for All Americans

Subtitle C - Quality Health Insurance Coverage for All Americans

Subtitle D - Available Coverage Choices for All Americans

As you can see in the image to the right, the phrase "All Americans" is repeated over and over and over again within the first few pages of the Affordable Care Act's table of contents.

Therefore, the plaintiffs argument that subsidies should only be available to "some" Americans instead of "all" Americans simply conflicts with too many other sections of the Affordable Care Act.









Section 1321(c) - Failure to Establish Exchange

Affordable Care Act Sec 36b Subsidy

Which brings us to the next point, and what many mainstream news outlets seem to forget. The Affordable Care Act actually does address the "state-based exchange issue" quite directly:

SEC. 1321. STATE FLEXIBILITY IN OPERATION AND ENFORCEMENT OF EXCHANGES AND RELATED REQUIREMENTS.

(c) Failure to establish Exchange or implement requirements

(1) In general

If—

(A) a State is not an electing State under subsection (b); or

(B) the Secretary determines, on or before January 1, 2013, that an electing State—

(i) will not have any required Exchange operational by January 1, 2014; or

(ii) has not taken the actions the Secretary determines necessary to implement—

(I) the other requirements set forth in the standards under subsection (a); or

(II) the requirements set forth in subtitles A and C and the amendments made by such subtitles;

the Secretary shall (directly or through agreement with a not-for-profit entity) establish and operate such Exchange within the State and the Secretary shall take such actions as are necessary to implement such other requirements.

The highlighted bold section of the Affordable Care Act above clearly gives the federal government not only the right to establish state-based exchanges in those states that do NOT do it themselves, but also a duty, and issuing subsidies are a necessary part of that duty to establish those exchanges.


SEC. 36B(f)(3) - Reconciliation of Credit and Advance Credit

Affordable Care Act 36b(f)(3) Subsidy Reporting

Under this section, the amount of subsides being issued must be reported by whomever is operating a state's exchange, whether it be the state itself under section 1311 directly or the federal government through section 1321.

36B - Refundable credit for coverage under a qualified health plan

(f) Reconciliation of credit and advance credit

(3) INFORMATION REQUIREMENT -

Each Exchange (or any person carrying out 1 or more responsibilities of an Exchange under section 1311(f)(3) or 1321(c) of the Patient Protection and Affordable Care Act) shall provide the following information to the Secretary and to the taxpayer with respect to any health plan provided through the Exchange:

(A) The level of coverage described in section 1302(d) of the Patient Protection and Affordable Care Act and the period such coverage was in effect.

(B) The total premium for the coverage without regard to the credit under this section or cost-sharing reductions under section 1402 of such Act.

(C) The aggregate amount of any advance payment of such credit or reductions under section 1412 of such Act.

(D) The name, address, and TIN of the primary insured and the name and TIN of each other individual obtaining coverage under the policy.

(E) Any information provided to the Exchange, including any change of circumstances, necessary to determine eligibility for, and the amount of, such credit.

(F) Information necessary to determine whether a taxpayer has received excess advance payments.

Therefore, the plaintiffs argument, that only an "Exchange established by the State" can receive subsidies, simply makes no sense. This is because the plaintiffs argument would be in direct conflict with Section 36B(f)(3) that requires the reporting of subsides issued through a state exchange created by the federal government under section 1321.


Congressional Intent - Carrot and Stick

One of the main arguments the plaintiffs have tried to make, that I have listed above, is that it was the intent of Congress all along to withhold subsides from any state that does NOT set up its own "state-based" exchange.

The plaintiffs insist that Congress was playing the old "carrot and stick" rountine in order to get the states to create and run their own exchanges by withholding the subsidies from those states that did NOT comply with the federal government's wishes.

However, this argument simply does NOT hold any water. When someone tries to argue "Congressional intent" it usually involves a law that was passed many decades ago, long after those members of Congress who were involved with the actual drafting of the law have long since passed.

The problem the plaintiffs have in this case is the fact that the Affordable Care Act is only 5 years old and every current and former member of Congress who was directly involved in the actual drafting of the Affordable Care Act are all still quite alive and kicking. So if the Supreme Court Justices really wanted to know what the "Congressional intent" was in regards to the issuing of subsides, then they could literally just walk down the street and ask them.

As a side note, the members of Congress who were actually involved in the drafting of the Affordable Care Act have all submitted briefs to the court saying that of course the subsidies were meant to go to all Americans regardless of where they purchased their health insurance from.

So in order for the Supreme Court Justices to side with the plaintiffs, in regards to "Congressional intent" in this case, they would also have to be saying that current and former members of Congress, who actually drafted the Affordable Care Act, lied to the court when they submitted their briefs.


No Consequence Clause - Pennhurst Doctrine

The Pennhurst Doctrine requires that Congress gives the states "clear notice" of conditions imposed under cooperative-federalism programs.

This means that when the federal government passes a law and it expects a state to follow that law or else, then there needs to be a direct "consequence" clearly stated without any ambiguity for failing to do so. The Affordable Care Act has NO such "consequence clause" in regards to subsidies being withheld from those states that do NOT establish their own exchange.

The plaintiffs simply try to infer that is what congress intended even though NO such "consequence clause" exist anywhere in the 974 pages of the Affordable Care Act.

For the plaintiffs argument to hold water there would need to be a "consequence clause" stating something similar to the following:

- If a state chooses NOT to establish their own exchange, then the residents of that state will NOT be eligible to receive subsidies.

However, this type of "consequence clause" simply does NOT exist anywhere in the entire text of the Affordable Care Act.

In addition, numerous states, including several Republican controlled states, have all submitted briefs to the court that clearly state that they were unaware that the subsidies for their residents would be withheld if they decided to let the federal government set up and run their exchanges. These court briefs from the states clearly illustrate the lack of any "consequence clause" in the Affordable Care Act, which furthers the government's case that there never was suppose to be a "consequence" to letting the federal government set up and run the exchanges within the states.


Occam's Razor - HealthCare.gov

Occam's Razor - When two competing hypotheses explain the data equally well, choose the simpler.

If one agrees with the plaintiffs arguments in this case, then one also has to believe that the following is true:

That the federal government went out of its way and spent hundreds of millions of dollars to create HealthCare.gov to serve no purpose at all. Because without the ability to issue subsidies it serves no purpose; people might as well just go and buy their health insurance directly from the health insurers own websites.

So is it simpler to believe that Congress actually did intend to provide every American access to subsidies through HealthCare.gov, or is it simpler to believe that Congress created a multi-million dollar website for no purpose at all?


Consequences: 6+ Million Lose Their Health Insurance and 9,000+ Die

The real world consequences, if the plaintiffs were to win this hyper-partisan Supreme Court case, are that over 6,000,000+ million Americans will more than likely lose their health insurance, if they lose their subsidies, and over 9,000+ of those Americans will die from preventable deaths within a year.

So the real question is whether or not the Supreme Court itself will truly bring about the so-called Obamacare "death panels" through judicial fiat, instead of the law itself.


Final Thoughts and Opinions

So with all that being said, it is about time that politicians, anti-ACA activists, and judges simply accept the reality of the Affordable Care Act, and quit wasting the taxpayers dollars on frivolous lawsuits against the Affordable Care Act. If you want to change or even repeal the Affordable Care Act, then the way to do it is by electing Representatives and Senators to Congress and a President who are all willing to do so, but certainly NOT through unelected federal judges.

For the party that claims to be the great defenders of the Constitution; the Republican party certainly seems to be relying more on judicial activism these days, then actually following the Constitution in regards to the true legislative process.

In closing, to all those far right-wing Americans out there cheering for the possibility that millions of lower-middle class Americans might lose their subsidies, and thereby lose their access to health insurance, and thereby lose their access to health care in general...

Well, all I have to say to you is that Karma can be a bitch, and one day soon Karma may just be knocking at your own door to collect.