Tuesday, February 17, 2015

The Incredible Shrinking Lawsuit: The Decomposition Of King v. Burwell // Balkinization

The assault on the Affordable Care Act in King v. Burwell isolates a provision and deploys it to defeat the central purpose of the integrated law.  Like Yale and Columbia law profs Abbe Gluck and Thomas Merrill in an amicus brief former Department of Justice lawyer Rob Weiner reads the statute as a whole. - gwc
Balkinization: The Incredible Shrinking Lawsuit: The Decomposition Of King v. Burwell
by Rob Weiner
 A monument on the Civil War battlefield at Gettysburg identifies the “high water mark of the Confederacy,” where General Pickett’s charge temporarily breached the front lines of the Union Army.  A significant issue in that War was the refusal of Southern states to accept the result of the Presidential election.  The Union’s ultimate victory vindicated the principle of majority rule within our constitutional system.
More than 150 years later, this democratic principle is still under siege—not by force of arms, but by the persistent efforts of the losers in legislative battles who seek to overturn the majority vote in the courts.  Nowhere are those efforts more relentless and dogmatic than in the profusion of lawsuits challenging the Affordable Care Act. The challenges, however, hit their own high water mark when the Supreme Court granted review in King v. Burwell.
Since then, the challengers’ claims, which were insubstantial to start with, have evaporated, laying bare both the absence of any coherent legal basis for the claims and the political nature of the litigation.   The challenges focus on the State insurance Exchanges required under the ACA.
An Exchange is essentially a Travelocity for insurance, where individuals can compare prices, find the best deal, and purchase their insurance.  Section 1311 of the ACA requires all States to establish an Exchange.  If a State does not establish the “required Exchange,” however, Section 1321 of the Act instructs the Secretary of HHS to establish “such Exchange” for the State.    The ACA expressly articulates the purpose of these Exchanges and of the insurance reforms the Act adopts—“Affordable Care for All Americans.”
To that end, the ACA mandates that individuals obtain health insurance, and it grants low-income families tax subsidies so they can afford to do so.  The subsidies provision, Section 36B of the Tax Code, first directs that a tax credit “shall be allowed” for non-elderly Americans with incomes between 100 and 400 percent of the federal poverty level.  But then another sub-subsection calculates the amount of the subsidy based on the cost of insurance purchased on “an Exchange established by the State under Section 1311,” followed by a sub-subsection that uses the same phrase in calculating the months of coverage.  Isolating that last phrase—“Exchange established by the State”— the challengers assert that low income families in states with Exchanges established by the Secretary of HHS cannot receive subsidies, or more precisely, that the amount of their subsidies is zero, because the Secretary is not “a State.” 
The simplicity of the argument, though alluring, is deceptive.  As the Government notes in its response, the disputed provision—when read in harmony rather than in conflict with the entire 900-page statute—merely makes the Secretary the surrogate of the State in establishing an Exchange.  An Exchange established by the Secretary in lieu of the State is “such Exchange”—the legal equivalent for purposes of the statute of an Exchange established by the State.  Adopting the challengers’ contrary interpretation not only would disable numerous provisions of the ACA, but also would defeat the central purposes of the Act."
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