Below is my column today in the Chicago Tribune on the rivaling rulings in the D.C. Circuit and the Fourth Circuit over a critical provision under the Patient Protection and Affordable Care Act (ACA). As an academic interesting in statutory interpretation and legisprudence, the opinions are fascinating and capture two different but well-argued views of the role of both courts and agencies in dealing with legislative language.
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Call it the “Tale of Two Circuits.” It was either the best of times or the worst of times yesterday for Obamacare.
Within hours of each other yesterday, two federal appellate courts looked at the Patient Protection and Affordable Care Act (ACA) on the same issue involving the same provision and came to diametrically opposite conclusions.
In Halbig v. Burwell, the D.C. Circuit ruled that the Obama Administration changed the meaning of the ACA and wrongly extended billions of tax credits to citizens without congressional authority. It was a stunning loss for the Administration. However, a couple hours later, the neighboring Fourth Circuit across the river ruled in King v. Burwell. That three-judge panel ruled that the Administration was perfectly within its rights to interpret the law in this fashion. Depending on which bank of the Potomac you stand on, Obamacare is either in robust health or on life support.
While the decisions have caused a whirlwind of political controversy, neither really turn on the question of national health care. Indeed, these two cases represent well reasoned but conflicting views of the role of court in statutory interpretation. The conclusion of these rivaling approaches hold the very viability of the ACA in the balance. That answer may have to wait for another appeal to the full courts of these respective circuits and ultimately an appeal to the United States Supreme Court.
In Halbig, Judge Thomas B. Griffith ruled that the statute is clearly worded on a key point of the law. At issue is the very thumping heart of the Obamacare: the system of state and federal “exchanges” through which citizens are required to purchase insurance. The law links the availability of tax credits to those states with exchanges “established by the state.” However, the Administration was caught by surprise when some 36 states opted not to create state exchanges. That represented a major threat to Obamacare. Without the credits, insurance would be “unaffordable” for millions of citizens who can then claim an exemption from the ACA. It would allow a mass exodus from the law – precisely what many citizens and critics have wanted.
To avoid that threat, the Obama Administration released a new interpretation that effectively read out “state” from the language – announcing that tax credits would be available to even states with only a federal exchange.
The D.C. Circuit ruled that the “interpretation” was really a re-writing of the federal law and that President Obama had over-reached his authority in violation of congressional power.
The Fourth Circuit came to the opposite conclusion. The court believed that the IRS was entitled to deference by the courts in what these laws mean in cases of ambiguity. The panel considered the law to be unclear and found that it was reasonable for the IRS to adopt an interpretation that guaranteed tax credits to all citizens.
At the heart of the conflict is a fundamentally different view of the role not just of federal courts but also of federal agencies. I have long been a critic of the rise of a type of fourth branch within our system. The Framers created a tripartite system based on three equal branches. The interrelation of the branches guarantees that no branch could govern alone and protects individual liberty by from the concentration of power in any one branch.
We now have a massive system of 15 departments, 69 agencies and 383 nonmilitary sub-agencies with almost three million employees. Citizens today are ten times more likely to be the subject of an agency court ruling than a federal court ruling. The vast majority of “laws” in this country are actually regulations promulgated by agencies, which tend to be practically insulated and removed from most citizens.
The Supreme Court ruled in 1984 in Chevron that agencies are entitled to heavy deference in their interpretations of laws. That decision has helped fuel the growth of the power of federal agencies in this fourth branch. The court went even further recently in Arlington v. FCC in giving deference to agencies even in defining their own jurisdiction. In dissent, Chief Justice John Roberts warned: “It would be a bit much to describe the result as ‘the very definition of tyranny,’ but the danger posed by the growing power of the administrative state cannot be dismissed.”
Regardless of the merits of the statutory debate over the ACA, the question comes down to who should make such decisions. For my part, I agree with the change but I disagree with the unilateral means that the President used to secure it. President Obama has pledged to “go it alone” in circumventing opposition in Congress. The Fourth Circuit decision will certainly help him fulfill that pledge. The result is that our model of governance is changing not by any vote of the public but by these insular acts of institutional acquiescence.
The court may call this merely deferring to an agency but it represents something far greater and, in my view, far more dangerous. It is the ascendance of a fourth branch in a constitutional system designed for only three.
Jonathan Turley is the Shapiro Professor of Public Interest Law and has testified before Congress on the constitutional implications of the health care cases.
Won’t it be great when patients starve to death over the weekend like they do in UK?
http://www.pnhp.org/news/2014/january/oncologists-call-for-single-payer-in-leading-cancer-journal
Oncologists call for Single Payer.
Karen, The president did not lie about keeping your own doctor, It isno different then HMO’s PPV if you choose those you will get the docs they want you to have, has nothing to do with ACA, it was the insurance companies who chose to sell sub par policies that they knew were not compliant. The pres had no way to know they would go out of their way to force cancellations, that is ot on the president. bbut keep up the fox, and teight lies, exaggerations and distortions. Because you say your premiums went up that is not the overall case.
And how is single payer working in Canada and Europe, which experiences much less immigration pressures on the system? They are running out of money. Even those who are afraid to lose the system, because no one every wants to get rid of “free stuff”, come to the US when they can’t afford to wait for single payer service.
So, when we have a health care system that attracts patients from single payer systems, what do we do? We clamor to make it single payer!
This column lays out the issues well.
I also fear the 4th branch, really the deep state at work for its own good. USGinc. is full of contractors who write, interpret and “enforce” regulations as they please. We as citizens do not know who these people are. They are not accountable to the people and are allowed a degree of secrecy in their actions, unheard of in our history.
The rise of the corporate state is showing its hand in the regulatory agencies. This is anti-democratic to its very core. Thus we have the dismemberment of the rule of law taking place on several fronts. These are scary times.
Thank you Mike!
Here’s another. Study indicates Single Payer would save billions in the first year.
http://www.pnhp.org/news/2013/july/‘medicare-for-all’-would-cover-everyone-save-billions-in-first-year-new-study
Because doesn’t the government know exactly how to run programs cost efficiently, with high quality? Oh wait. Our procurement system ensures we over pay while they under deliver. Just like the Obamacare federal website.
So let’s see . . . what system exists in the entire world where suppliers match customers’ needs on a mutually agreed upon price? Oh, I know! Capitalism! What system creates a system or product that customers do not want and does not fit their needs, reducing their choices, and then fines them if they don’t buy it? The government!
There will be a pop quiz tomorrow.
Annie:
Found it.
“Single Payer is the answer.” Because the VA is doing such a great job. And isn’t it wonderful how the VA doctors and surgeons, government employees, do 1/8 the work load of private practice? What a GREAT model to inflict on the rest of us! The vast majority of Americans vote against single payor ever single solitary time it comes up . . . but I know! We can just LIE to get it passed, like what happened with Obamacare – where they lied about the premiums, deductibles, doctor choice, and the ability to keep your doctor and insurance. The President lied to the American people, and he got away with it. Nothing happened. No consequences.
CH
Now, in addition to dumping private insurers, if you could just get the entire health care industry itself to provide its services on a non-profit basis I think you’d be all set.
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Non-profit hospitals are the rule around me. But the doctors, nurses and staff are for their own profit. As are the equipment suppliers and manufacturers.
You’d be better off providing a central purchasing system, like the Federal Government has with their GSA Schedules, to hospitals to help drive down costs on equipment and supplies. Then look at the insurance market for malpractice and the costs it is imposing on doctors and medical groups.
Why is my comment awaiting moderation?
http://www.pnhp.org/news/2007/february/how_would_single_pay.php
How would Single Payer control costs?
Annie & Mespo,
Now, in addition to dumping private insurers, if you could just get the entire health care industry itself to provide its services on a non-profit basis I think you’d be all set.
John:
“Single – payer is the best option to control what exactly?”
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Unbridled, predatory capitalism resulting in 25,000 deaths a year.
Single – payer is the best option to control what exactly?
Annie:
Single payer has always been the answer but is regarded as a threat to profits by the health care corporate oligarchy that runs things.
““The five largest health insurance companies – WellPoint, United Health, Aetna, Humana, and Cigna – … earned over $3.3 billion in profits [between April and June 2011].” Shah goes on to contend that “Profit in the health insurance industry is the single greatest barrier to building an efficient, sustainable system of healthcare in this country.”
http://www.forbes.com/sites/peterubel/2014/02/12/is-the-profit-motive-ruining-american-healthcare/
Non-healthcare business leaders are finally catching on.
Single Payer is the answer. Yes paying for a product sold by private insurance companies is a very bad idea. It will always be too expensive. My premiums on my private health insurance were going up every year since the 70’s. In the 80’s, they went up more, in the 90’s my premiums went up yet more and covered far LESS. Why do we want to pay the middle man for a bad product?
If they do remove the subsidies, and people realize how much Obamacare ACTUALLY costs to those, like me, in the middle class, who don’t receive subsidies, maybe there can be some honest discussion about this law’s catastrophic failings.
“At issue is the very thumping heart of the Obamacare: the system of state and federal “exchanges” through which citizens are required to purchase insurance. The law links the availability of tax credits to those states with exchanges “established by the state.” However, the Administration was caught by surprise when some 36 states opted not to create state exchanges. That represented a major threat to Obamacare.”
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It’s not quite as simple as the ACA simply mandating only “state” exchanges as Judge Gregory notes. Also, I’m not sure if “the Administration” was caught by surprise but the drafters of the legislation don’t appear to have been. The law allows for reluctant states who fail to set up exchanges and authorizes HHS to set it up for them under a national scheme:
Of course, § 1311’s directive that each State establish an
Exchange cannot be understood literally in light of § 1321,
which provides that a state may “elect” to do so. Section
1321(c) provides that if a state fails to establish an Exchange
by January 1, 2014, the Secretary “shall . . . establish and
operate such Exchange within the State and the Secretary shall
take such actions as are necessary to implement such other
requirements.” (emphasis added). The defendants’ position is
that the term “such Exchange” refers to a state Exchange that is
set up and operated by HHS. In other words, the statute
mandates the existence of state Exchanges, but directs HHS to
establish such Exchanges when the states fail to do so
themselves. In the absence of state action, the federal
government is required to step in and create, by definition, “an
American Health Benefit Exchange established under [§] 1311” on
behalf of the state. (Opinion at p. 19).
“Oh, and what “state” does John Kerry work for, as Secretary of State?”
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Chaos or Tranquility; depending on your point of view.