Supreme CourtBelow is my column today in the Los Angeles Times on a little discussed case that presents a far greater threat to Obamacare than did Hobby Lobby. The Hobby Lobby case is a huge blow for the Administration in terms of one of the most prominent provisions of the Act and recognizing religious rights for corporations. However, it is more of a fender bender for the ACA. Halbig could be a train wreck of a case if it goes against the Administration. We are expecting a ruling any day and the panel is interesting: Judges Harry T. Edwards (a Carter appointee), Thomas B. Griffith (a George W. Bush appointee), and A. Raymond Randolph (a George H.W. Bush appointee). In oral argument, Edwards was reportedly highly supportive of the Administration’s argument while Randolph was very skeptical. That leaves Griffith. It could go 2-1 either way, though in my view the interpretive edge goes to the challengers for the reasons discussed below. This case however is largely a statutory interpretation case, though it has the same separation of powers allegations of executive overreach that we have seen in other recent cases.

Now that the Supreme Court has issued its ruling in the Hobby Lobby case, the legal fight over the Affordable Care Act will shift a few blocks away to another Washington courtroom, where a far more fundamental challenge to Obamacare is about to be decided by the powerful U.S. Court of Appeals for the D.C. Circuit. Indeed, if Hobby Lobby will create complications for Obamacare, Halbig vs. Burwell could trigger a full cardiac arrest.

The Halbig case challenges the massive federal subsidies in the form of tax credits made available to people with financial need who enroll in the program. In crafting the act, Congress created incentives for states to set up health insurance exchanges and disincentives for them to opt out. The law, for example, made the subsidies available only to those enrolled in insurance plans through exchanges “established by the state.”

But despite that carrot — and to the great surprise of the administration — some 34 states opted not to establish their own exchanges, leaving it to the federal government to do so. This left the White House with a dilemma: If only those enrollees in states that created exchanges were eligible for subsidies, a huge pool of people would be unable to afford coverage, and the entire program would be in danger of collapse.

Indeed, the Halbig plaintiffs — individuals and small businesses in six states that didn’t establish state exchanges — objected that, without the tax credits, they could have claimed exemption from the individual mandate penalty because they would be deemed unable to pay for the coverage. If the courts agree with them, the costs would go up in all 34 states that didn’t establish state exchanges, and the resulting exemptions could lead to a mass exodus from Obamacare.

The administration attempted to solve the problem by simply declaring that even residents of states without their own exchanges were eligible for subsidies, even though the law seemed to specifically say they were not. The administration argues that although the statute’s language does limit subsidies to residents of places with exchanges “established by the state,” that wording actually referred to any exchange, including those established by the federal government. In January, a district court judge upheld that interpretation, allowing the subsidies to continue.

But the D.C. Circuit Court may see things quite differently, especially in light of recent Supreme Court opinions holding that the Obama administration has exceeded its authority and violated separation of powers.

In Michigan vs. Bay Mills Indian Community, for example, Justice Elena Kagan noted that “this court does not revise legislation … just because the text as written creates an apparent anomaly as to some subject it does not address.” In Utility Air Regulatory Group vs. EPA, Justice Antonin Scalia, writing for the majority, stressed that “an agency has no power to tailor legislation to bureaucratic policy goals by rewriting unambiguous statutory terms.” And a third strike came last week in National Labor Relations Board vs. Canning, when the Supreme Court unanimously found that President Obama had violated the Constitution in circumventing Congress through his use of recess appointments.

The D.C. Circuit Court is expected to rule any day now on the Halbig case, and supporters of the Affordable Care Act are growing nervous. In January, an Obamacare advocate described the Halbig case to a reporter for the Hill as “probably the most significant existential threat to the Affordable Care Act. All the other lawsuits that have been filed really don’t go to the heart of the ACA, and this one would have.” And in the intense oral argument before the D.C. Circuit Court, the administration seemed to struggle to defend its interpretation.

If the ruling goes against the White House, it’s hard to overstate the impact. Without subsidies, consumers in 34 states would face huge additional costs and, because of those costs, potential exemptions from the law. And voters — a substantial percentage of whom have never liked Obamacare — would be further alienated from the Democratic Party just in time for midterm elections.

Moreover, a ruling against the administration would mean that Obama has been responsible for ordering what could amount to billions of dollars to be paid from the federal Treasury without authority. And it would mean the administration has committed yet another violation of the separation of powers.

The administration’s loss in the Hobby Lobby case is a bitter pill to swallow, but it is not a lethal threat to Obamacare. For critics of the law, Halbig is everything that Hobby Lobby is not. Where Hobby Lobby exempts only closely held corporations from a portion of the ACA rules, Halbig could allow an mass exodus from the program. And like all insurance programs, it only works if large numbers are insured so that the risks are widely spread. Halbig could leave Obamacare on life support — and lead to another showdown in the Supreme Court.

Jonathan Turley is a professor of law at George Washington University and has testified in Congress on the executive orders under the Affordable Care Act.

July 1, 2014 – Los Angeles Times


  1. Justice Ginsburg –

    — Conservatives, however, have good reason to be skeptical of the left’s “respect’’ for the Constitution. Just last week, for example, Supreme Court Justice Ruth Bader Ginsburg told an Egyptian TV station that she would not recommend the U.S. Constitution as model for Egypt’s new government.

    The problem, you see, is that the U.S. Constitution is “a rather old constitution.” Ginsburg suggested that Egyptians should look instead to the Constitution of South Africa or perhaps the European Convention on Human Rights. All these are “much more recent than the U.S. Constitution.” —

    Justice Ginsburg has disparaged the documents and the nation she is sworn to uphold; the very nation that electrocuted the Roosevelt-era Julius and Ethel Rosenberg for subversion and treason by way of espionage. Ginsburg dissents from the words of the Preamble and Constitution. How is that possible?

    The SCOTUS has one duty – to uphold the literal words of the Preamble, Constitution and Bill of Rights. Justice Ginsburg does not have the power to impose ideology or “legislate from the bench.” It is not possible for the SCOTUS to issue split decisions. Decisions must be unanimous. The Preamble and Constitution are not duplicitous and can be read only one way. Cases either comport with the literal words of the Preamble and Constitution or they don’t. Justices have to read those literal words the same way with unanimity.

    Either the nation is established by the Preamble and Constitution or America is a free-for-all. History tells us that the Founders “gave us a republic.” What kind of republic has a Supreme Court that controverts the literal words of its Preamble and Constitution.

    Response to previous poster:

    America is governed by the Preamble and Constitution not the Communist Manifesto or founding documents of any other country.

    Comparisons to foreign countries not governed by the Preamble and Constitution do not bear.

    Socialist countries are communist countries that coddled their “geese that laid the golden eggs” – China coddles Hong Kong, Germany coddles BMW and Mercedes Benz because those capitalist entities are imperative to the survival of the communists.

    The end justifies the means for the communists. Making money is the end for the capitalists and the end for the communists is obtaining the money the capitalists make. They take other peoples’ money by any means available.

    Anecdotes relating the conditions in other countries, while amusing, have absolutely zero bearing on the Preamble and Constitution which prevail in America and clearly limit government to security and infrastructure while securing “the blessings of liberty” to citizens.

    Read “Witness” by Whitaker Chambers. Everyone can start at the bottom, work, sacrifice and improve their life. Only parasites are afraid of capitalism – the definition of which is freedom and self-reliance. Only parasites need governmental control of the economy and redistribution.


    Why don’t all you liberals come clean; come out of the closet and promote the imposition of the Communist Manifesto on America? Get rid of that pesky Preamble and Constitution.

    “To thine own self be true, and it must follow, as the night the day, thou canst not then be false to any man.”

    William Shakespeare

  2. Well guys, I can smell fraud when it reeks right enough. I can tell what don’t know by what you write. And discretion is always the better part of valor; better to run and hide and batter your little free market platitudes back and forth,rather than exhibit your inability to refute the irrefutable.

  3. Paul, No you haven’t. King RTC knows you better than you know yourself. Hell, he knows how old I am, what I know or don’t know, What my life experiences are, what I work on and what I do for a living all without even meeting or knowing me. He’s quite amazing. Dam, he knew that too!

  4. RTC – No, it’s called avoiding condescending jerks. And in doing so, bye, bye. Check and mate that!

  5. Yes, Jim, you’re strategy is to avoid facts you can’t understand or explain, as we’ve seen in your position on climate change. The technical term is called sticking your head in the sand.

    When does school start, er, uh, I mean, when do the Chinese take deliver on their brand new gas-fired turbine?

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