Archive for the ‘ObamaCare’ Category

An Exchange Established By The State

November 9, 2014

I’ve looked through the ACA, to find every place it refers to Exchanges created “by the State”.  The phrase “by the State” is found on 63 pages of the Certified ACA:

Page 403 – 404 of the Certified ACA
Subject to the succeeding paragraphs of this subsection, during the period that begins on the date of enactment of the Patient Protection and Affordable Care Act and ends on the date on which the Secretary determines that an Exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act is fully operational, as a condition for receiving any Federal payments under section 1903(a) for calendar quarters occurring during such period, a State shall not have in effect eligibility standards, methodologies, or procedures under the State plan under this title or under any waiver of such plan that is in effect during that period, that are more restrictive than the eligibility standards, methodologies, or procedures, respectively, under the plan or waiver that are in effect on the date of enactment of the Patient Protection and Affordable Care Act.

This clearly defines “an Exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act” as being different from the Federal Exchange it’s replacing

Page 2154 of the Certified ACA
With respect to each State, the Secretary, not later than April 1, 2015, shall review the benefits offered for children and the cost-sharing imposed with respect to such benefits by qualified health plans offered through an Exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act

This specifies that “qualified health plans offered through an Exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act” are subject to review by the Secretary to make sure that they meet the Federal standards.  This distinguishes from plans set up under a Federal Exchange, where one assumes the Secretary would not allow then into the Exchange unless they met the Federal standards.

All of the rest of the uses of “by the State” connected to “Exchanges” are in the section on CHIP.  In no place is there ever any equivalency created between “an Exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act”, and a Federal “Exchange”.

If we are to believe that Congress was using the offer of ACA subsidies to get States to set up their own Exchanges, I can see no grounds for saying “but they wouldn’t hold children hostage!”  Since, after all, they are holding hostage all the children of people who don’t qualify for CHIP.

More on ObamaCare / Halbig / King

November 9, 2014

Another nice post from Ziff Blog (here’s my response to the first post of his that I saw).  After some really good comentary, he posts the following questions:

  1. If the term “Exchange” is defined in the statute as “an American Health Benefit Exchange established under section 1311 of the [PPACA],” PPACA § 1562(b) (emphasis added), and if section 1311 only provides for state exchanges (with section 1321 providing for federal exchanges), then does the term “Exchange” standing alone, without modification, mean only state-established exchanges?
  2. Relatedly, if an Exchange is defined as something established under section 1311, how can the Secretary ever create an Exchange as that term is used in the rest of the PPACA?
  3.  If the term “Exchange” is meant to refer inclusively to federal- and state-established exchanges, then what is the effect of the “established under section 1311” language in section 1562(b)?
  4. If the PPACA sets up a two-tiered system for federal- and state-established exchanges, where are the provisions governing exchanges “established under section 1321” or “established by the Secretary under section 1321”? If they are absent, why are they absent?
  5.  If the term “Exchange” is meant to refer generically to federal- and state-established exchanges, with the phrase “Exchange established by the State” reserved solely for state-established exchanges, then why would the PPACA make federal-established exchanges subject to annual audits by the Secretary if the Secretary is the one operating the exchange?
  6. Is a regional exchange operated by a collective of states an “Exchange established by the State under section 1311”? What if one state “established” the Exchange but the other state simply permits the operation of the exchange within its borders, pursuant to section 1311(f)(1)?
  7. What is the difference between an Exchange, an “Exchange established pursuant to this title,” section 1303(a)(1)(D), an “Exchange established under this Act,” section 1312(d)(3)(D)(i), an “Exchange established under section 1311,” see, e.g., section 1331(e)(2), and an “Exchange established by the State under 1311,” section 1401(b)(2)(A)? The PPACA uses all of these differing phrases to refer to exchanges.
  8. Relatedly, could a state establish an exchange pursuant to a section other than section 1311? Could the Secretary establish an exchange pursuant to section 1311? If not, then why say “established by the State pursuant to section 1311”?

I’m going to skip the first three, because no answer to them affects my argument.

4: They are absent because the only difference between the two types of exchanges is the subsidies, and that’s fully taken care of by the language creating the subsidies.

5: IIRC, the audit language requires a number of reports about who’s getting insurance, etc.  Information needed by the IRS (when enforcing the Individual Mandate) regardless of where the insurance comes from, or whether or not the individual is getting subsidies.

6: I would say that because of the poor writing of the ACA, in neither of those cases would someone be eligible for a subsidy. I’ve changed my mind on this one.  Let’s go back to the text of the ACA:

(A) IN GENERAL.—The term ‘coverage month’ means, with respect to an applicable taxpayer, any month if—

(i) as of the first day of such month the taxpayer, the taxpayer’s spouse, or any dependent of the taxpayer is covered by a qualified health plan described in subsection (b)(2)(A) that was enrolled in through an Exchange established by the State under section 1311 of the Patient Protection and Affordable Care Act,

In this text “the State” refers to the Exchange, not to the taxpayer.  It is not the taxpayer’s State we’re worried about, but the State that set up the Exchange.  A regional Exchange is still an Exchange set up by the States, not by the Federal Government.  As it is an Exchange set up by the State the individual lives in, the individual would be eligible for subsidies. (The requirement is not set up only by the State, just set up by the State.)  The shared Exchange is an Exchange set up by the State that set it up, not by the Federal Government.  So, again, the person purchasing insurance on that Exchange is eligible for subsidies.

Nothing in the ACA says that the Exchange has to be set up by only the State, or by the State the individual lives in.  So neither is an impediment to a subsidy.

7: I don’t know, ask the people who wrote the ACA.  What I do know is that an Exchange established by the Federal Government is, by definition, not an Exchange established by a State.  And I know know that the ACA established that an Exchange set up by a Territory “shall be treated as a State for purposes of such part“.  No such language exists for the Federal Exchanges.

8: A: A State could have set up a health insurance Exchange 10 years ago (not under a different Section of the ACA, but simply based on its own inherent police powers, and power to regulate health insurance).  What would have stopped a State from doing that? B: I say no, the Halbig Court says Yes.. C: Because they wanted to limit subsidies to Exchanges that were 1: Not set up by the Federal Government and 2: Followed the rules of the ACA.  Which is the point of King and Halbig.

Now, I have three questions for Ziff (or any other anti-Halbig individual):
1: The ACA says that an Exchange set up by Washington DC shall be treated as an Exchange set up by a State.  It says that Exchanges set up by any of the Territories shall be treated the same way.  Is there a fifth type of Exchange?  Or is the only other type of Exchange one set up by the Federal Government?

2: Why was the phrase “an Exchange established by the State under section 1311” used in the ACA, when, under your interpretation, what was meant was “an Exchange”? I don’t have the reference to hand, but I know there’s a Supreme Court precedent to the point that we must assume that Congress put words into a statue for a reason, and an interpretation that makes words superfluous is inherently inferior to one that does not.  Does your argument not suffer from that fatal flaw?

3: Have you read the Halbig majority opinion? Have you put together a point by point refutation of it? If so, where is it?  If not, would it not behoove you to do so?  Wouldn’t that be a far more productive use of your time than arguing with a bunch of bloggers?

Because if you can’t take it down (and I don’t believe you can), you’d better resign yourself to losing in the Supreme Court.

Halbig and King, a response to Ziff Blog

August 2, 2014

A left-wing blogger named David Ziff wrote some intelligent commentary on Halbig, and the poor quality of the left’s response.  However, he also wrote the following:

It’s not like we don’t have good textual and contextual arguments on the left! For one, read the Court of Appeals decision in King v. Burwell starting on page 15.

I made the following comment.  Here’s I’ll do it with formatting 🙂

If you’re resting your hopes on the King Court, you’re going to be very disappointed.  First, let’s consider this from the 4th Circuit Opinion:

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.

This is really pathetic.  The text says “enrolled in through an Exchange established by the State under [§]1311 of the [Act].”  “By”  Not “on behalf of”.

Second, there’s this, from Halbig (pages 18 – 20):

The dissent [and the 4th Circuit in King] attempts to supply this missing equivalency by pointing to section 1311(d)(1), which provides: “An Exchange shall be a governmental agency or nonprofit entity that is established by a State.” 42 U.S.C. § 18031(d)(1). According to the dissent, (d)(1) means that an Exchange established under section 1311 is, by definition, established by a state. Therefore, the dissent argues, because federal Exchanges are established under section 1311, they too, by definition, are established by a state.
The premise that (d)(1) is definitional, however, does not survive examination of (d)(1)’s context and the ACA’s structure. The other provisions of section 1311(d) are operational requirements, setting forth what Exchanges must (or, in some cases, may) do. See generally 42 U.S.C. § 18031(d)(2)-(7) (listing “[r]equirements”). Read in keeping with that theme, (d)(1) would simply require that an Exchange operate as either a governmental agency or nonprofit entity. But the dissent would have us construe (d)(1) differently. In its view, (d)(1) plays a definitional role unique among section 1311(d)’s otherwise operational provisions, creating a legal fiction that any Exchange is, by definition, established by a state, even when, as a matter of fact, it is not. That reading, however, would render (d)(1) the odd man out twice over: both within section 1311(d) and among the ACA’s other definitional provisions, which, unlike (d)(1), employ the (unmistakably definitional) formula of “The term ‘X’ means . . . .” See, e.g., 42 U.S.C. §§ 300gg-91, 18024; see also 26 U.S.C. § 4980H(c).
The dissent’s reading would also require us to overlook the fact that section 1311(d) would be a strange place for Congress to have buried such a legal fiction. Section 1311, after all, concerns Exchanges that are established by states in fact; the legal fiction the dissent urges would matter only to Exchanges established by the federal government. To accept the dissent’s construction would therefore transform (d)(1) into the proverbial elephant in the mousehole—the “ancillary provision[]” that “alter[s] the fundamental details of a regulatory scheme.” Whitman v. Am. Trucking Ass’ns, 531 U.S. 457, 468 (2001). The Supreme Court has repeatedly held that Congress does not legislate in this manner, see id.; accord Gonzales v. Oregon, 546 U.S. 243, 267 (2006), and we see no evidence that it did so here. Indeed, we are particularly loath to accept the dissent’s construction given that there are far more natural locations to place this fiction, such as section 1321 or the provision defining the term “Exchange,” 42 U.S.C. § 300gg-91(d)(21).

Sorry, but the law was written as Gruber was claiming it was written back in 2012: The States would be forced to set up Exchanges by the threat that they would get no subsides.  The threat didn’t work, the gamble failed.  You want that changed?  Then you’re going to have to negotiate with Republicans, and give up a lot.  That’s what happens when you screw up.

Why I’m happy SCOTUSBlog didn’t get press credentials

June 30, 2014

While sitting at the SCOTUSBlog LiveBlog today, waiting for the opinions, I saw a link to Amy Howe’s “Plain English” review of McCullen v. Coakley. She closes with this:

The case is also interesting because of what it may signal for the challenge to the Affordable Care Act’s contraception mandate, in which we are still waiting on the Court’s decision.  Although the precise issues before the Court are different, both involve the intersection of the First Amendment (the McCullen plaintiffs’ desire to counsel women who might be seeking abortion and the Hobby Lobby families’ firm opposition to providing their female employees with birth control) and women’s reproductive rights.

What a load of crap.  Hobby Lobby pays for 16 different types of birth control.  What they refuse to pay for is abortificants.  This sort of dishonest left-wing propagandizing (and if she really didn’t know those facts, and if no one else at SCOTUS Blog didn’t know those facts, that would be world class incompetence) is why I’m happy SCOTUSBlog got stiffed.  If we want to read a dishonest fmale pushing left wing propaganda about Court cases, we’ve already got Linda Greenhouse, we don’t need amy Howe and the rest of the SCOTUSBlog crew.

Republican Health Care plans

April 29, 2012

Thanks to BufordTJustice1 for the following information on Republican Health Care provision reform plans, in response to a Volokh commenter (troll?) claiming that “the Republicans have no plan”:

HR3400 sponsored by Tom Price detailed at the following URL:…

The formal HR3400 bill can be viewed at:…

Another GOP bill for health care reform is HR3962 by John Boehner which is 219 pages in length. The URL is:…

The Pledge to America also provides details of their ideas for alternative legislation. That has been available since September 23, 2010.

Also, John Boehner held a national Republican address on October 31, 2009 outlining GOP ideas for health care reform.

Mitt Romney has described his Medicare plan:………

Paul Ryan released a Medicare plan which was soon followed by a revised plan with Ron Wyden.…

Most recently, Paul Broun released his replacement plan.

You speak of making things worse? The new cost shifting will blow away the current cost shifting by an order of magnitude. Subsidies and tax credits alone will cost $777 billion for the first seven years. Many if not most of them will pay nothing (or almost nothing) for their premiums. Then there’s the Medicaid expansion, estimated to cost $408 billion (state and federal combined). Obamacare preserves and reinforces the old cost shifting, while adding $1.2 trillion in new cost shifting.

The mandate will do absolutely nothing of any appreciable amount to resolve the current cost shifting and will make it massively worse:

About $30.2 billion of the $43 billion cannot be remedied by the mandate and will continue on just like before. That leaves $12.8 billion which is 0.5% of the nation’s health care costs, leaving 99.5% of health care expenditures unchanged. Unless you believe the mandate will work perfectly (which it won’t), it will not even come close to resolving $12.8 billion, especially once the word gets out how easy it is to game the system (see below). The government will be lucky if a small fraction of the $12.8 billion is even remotely alleviated, reducing the effect of the mandate to a purely symbolic token. This amount in relation to the total costs is virtually invisible and will have no tangible effect on cost shifting.

Those few not exempt from the mandate, not eligible for Medicaid and would not receive any tax credits or subsidies that don’t want to buy insurance now will not change their minds and will continue to freeload. Not only will the fine be less than the cost of the premium, but why even pay the fine if there is no arrest, lien, audit or garnishment allowed by Obamacare? All the IRS can do is withhold a tax refund.

Already, 49% of the country doesn’t even pay federal income tax in the first place. Out of the 51% who do, how many are owed a refund? Out of those, how much are they owed (i.e. even less than the amount of the fine)? Even if they pay the fine, they are still not in the insurance pool to spread the cost around which totally defeats the purpose of the mandate and Obamacare itself.

By the way, any exchanges run by the federal government will result in nobody in those states receiving tax credits/subsidies to buy insurance. The hasty, sloppy and corrupt writing of the bill only allowed this support for exchanges run by the states. This will result in the employer mandate going down. Business will sue if they are fined for not providing health insurance to employees who are not even eligible to receive benefits by going on the exchanges.

Did you also know Medicare Advantage is being propped up artificially by a corrupt and possibly illegal expenditure of $8.5 billion to sustain it only past the election? After the election, the plug will be pulled, screwing over seniors all across the country.

The Individual Mandate and Welfare drug testing

April 19, 2012

There’s been a lot of arguing recently about whether or not the Federal Government should have the power to force individuals to buy health “insurance” policies they don’t want, and don’t need (I don’t need a $5,000 / year “comprehensive health insurance” policy if I’m a 25 year old male with no health problems. Catastrophic coverage, maybe, “comprehensive” coverage? No). The Left is in favor, the right is opposed.

From Tom McGuire I just learned about a different fight.  In this one, the State of Florida has decided that it doesn’t want to give cash assistance to drug users, and so is requiring drug tests from anyone who wants to get cash assistance (it pays for the drug test, if you pass it).  The Left is outraged at this.

I’m trying to wrap my mind around the mentality that approves of the first, but not the second.  The best I can come up with is that, to the Left, all money, everywhere, is theirs.  Not the government’s, most certainly not the property of the individual who made it, all money belongs to the Left.  Don’t want to spend your own money buying an unneeded “health insurance” policy?  Tough.  They want to cut costs for people they care about more than they care about you, so you have to pay.  Don’t want to give cash to drug users?  Tough.  They like drug users, esp. ones who’ve so screwed up their lives that they can’t survive without outside help, so the drug users get your money.


Any other justifications?

Mushrooms and Health Care

April 3, 2012

No, this is not a post about the medicinal values of mushrooms.  This is about the 2001 Supreme Court ruling that a “Commerce Power” “corporate mandate” was unconstitutional, and what it should say about the Constitutionality of the Individual Mandate (hat tip John Hindraker)

In a 6 -3 decision written by Justice Kennedy, UNITED STATES v. UNITED FOODS, the Supreme Court struck down the Mushroom Promotion, Research, and Consumer Information Act mandate, ruling that the USDA could not force companies to give money to a program to “strengthen the market” for the commodity they produce.  The Federal government argued:

[A]s long as Congress has a legitimate interest in strengthening the market for a particular agricultural commodity, Congress is entitled . . . to enact this sort of program and impose it on an industry.

Sound familiar?  It should, if you’ve listened to any lefties arguing that Congress’ legitimate role in regulating the health insurance industry entitles it to impose the Individual Mandate on all American citizens.  However, Justice Kennedy wasn’t impressed.  In that case he said they Federal Government was trampling companies First Amendment rights, including the right not to say anything.  Which fits right in with the concerns stated by Justice Kennedy during Oral Argument, that the Individual Mandate was an Federal Government assault upon individual liberty.

Hopefully he’ll decide that individuals are entitled to the same liberty as corporations, when it comes to the right not to do things.

Contraception, ObamaCare, and the Left-Wing Bubble

April 1, 2012

Jonathan Adler wrote a post at Volokh asking why “legal elites” made such bad predictions about how the ObamaCare argument would go.  So far, I haven’t seen anyone ask if one of the results of that blindness was the Obama Administration rules forcing Catholic organizations to purchase health insurance that provides contraceptives, and even abortificants (Plan B).  “Swing Justice” Kennedy is a Catholic who is very concerned about “liberty”.  If the Obama Administration was aware a month ago that they desperately needed his vote to let ObamaCare live, and that it was going to be tight, at best, for their side, would they have gone ahead and announced that they were going to use ObamaCare to force every Catholic School, food kitchen, hospital, etc. to violate its principles?  Would they have announced that the final regulations would go into effect in May, so that the Supreme Court is getting appeals for protection from ObamaCare while the Supreme Court is finalizing the decisions and votes on whether to throw out ObamaCare?

What will the effect be on the 5 Catholic “conservative” Justices?  Will they look at the Obama Administration’s assault upon religious liberty using ObamaCare, and say “let’s just kill the whole thing, so we don’t have to deal with this”?  If they strike down the individual mandate, and strike down community rating and guaranteed issue, and strike down the Federal Government’s power to define “minimum insurance standards”, what’s left?  Also, if they strike down the whole law, then they don’t have to try to answer if the Medicare expansion is “coercive”.  Perhaps they want to answer that question.  But if they don’t, “kill it all, let the voters settle it” seems like a smart way to go.

A Federal Government of Limited Powers

April 1, 2012

Over at Volokh, several commenters have been whining that it’s a violation of precedent for the Supreme Court to reject a government power (such as the individual mandate) just because there’s no “limiting principle” that would accept that power, but deny the Federal Government other powers.  Glenn Reynolds article in the Examiner today effectively rebuts that, with a quote from Lopez (the decision that overturned the “no guns within 1000 feet of a school law):

It was not acceptable, the majority opinion said, to “pile inference upon inference” in order to extend federal power so far beyond its intended limits. “To do so would require us to conclude that the Constitution’s enumeration of powers does not presuppose something not enumerated, and that there never will be a distinction between what is truly national and what is truly local. This we are unwilling to do.”

Verrilli didn’t look like an ass because the Court changed the rules on him,Verrilli looked like an ass because the people who wrote ObamaCare decided they could ignore Lopez, and as such they left Verrilli with an indefensible law to try to defend.  Also left looking like the asses they are are all the left-wing “legal commentators” (Linda Greenhouse, etc.) who insisted that the Individual mandate was a Constitutional “slam dunk”, apparently having wiped from their minds that Kennedy voted in the majority on Lopez and in Bond v. United States Kennedy wrote last year:

[Limiting federal power] protects the liberty of all persons within a state by ensuring that laws enacted in excess of delegated governmental power cannot direct or control their actions. By denying any one government complete jurisdiction over all the concerns of public life, federalism protects the liberty of the individual from arbitrary power. When government acts in excess of its lawful powers, that liberty is at stake.

If that doesn’t sound like “just because States can do it, doesn’t mean the Federal Government can”, then you’re not paying attention.  That, BTW, was a 9-0 decision.  Which is what the ruling striking down the Individual Mandate would be, if the four “liberals” on the Court were honest Justices, rather than left-wing hacks.

The Washington Post doesn’t understand insurance, or markets

March 30, 2012

The Washington Post has an editorial on the Supreme Court hearings on ObamaCare that gets a passing grade on Civics, but a flunking grade on understanding of insurance.  They wrote

There was, in some of the conservative argumentation over three days, a distressing undertone of me-firstism. Congress wanted to “capture” young people, attorney Paul D. Clement argued on behalf of the states objecting to the health-care plan, because they are “the golden geese that pay for the entire lowering of the premium.”  Well, yes, that is how insurance works

No, it’s not.  If you buy Term Life insurance, you pay a different, and much lower, rate if you’re 25, than you do if you’re 45, or 65.  And yo pay a much higher rate if you’re a smoker  If you buy auto insurance, you pay a much higher rate if you’re 18 and have no tickets or accidents, than if you’re 25, 35, or 45 also with no accidents or tickets.  Insurance is about pooling risk, it’s not about transferring costs from the politically favored to the politically unfavored.  For that you have government.  As Mr. Carvin pointed out during arguments of the individual mandate, “since the founding, whenever Congress has imposed that public responsibility on private actors, it has subsidized it from the Federal Treasury. It has not conscripted a subset of the citizenry and made them subsidize the actors who are being hurt, which is what they’re doing here.”

The Democrats writing ObamaCare didn’t do that, because (as the Post editorial notes) they wanted to hide the cost of their actions from the American people.  That’s not “insurance”, that’s fraud, dishonesty, and normal operating procedure for the Democrat Party.

Then there’s their defense of “health care is special:

Mr. Verrilli, in fact, had a persuasive response: The health-care market is different from all others because virtually everyone, like it or not, will become entangled in it. You can choose not to buy a car; you can’t necessarily choose not to be hit by one. If you end up in the emergency room, you will be cared for, as federal law demands. The government, already deeply involved in regulating the health-care market, has a legitimate interest in encouraging you to prepare for such an eventuality.

(Bold face added).  Apparently the Washington Post editors are unaware that everyone has to buy food, and so is entangled in the “food market”.  So I guess that Congress can force us to eat broccoli, or at least force us to buy it.  They’re also unaware that everyone has to get around, and so is involved in the “transportation market” (sorry, but if podiatry, urology, and ophthalmology are all part of the same “market”, then so are cars, buses, and shoes).  Further, they seem to have decided that since the Federal Government has imposed market distorting regulations on the health care market, this expands the Constitutional limits on the power of the Federal Government in the health care market.  This is a flawed argument.

Ending on a high note, they did get one thing right:

But we also think there’s a kind of cynicism, or at least intellectual laziness, in asserting that this is an easy or obvious call — that no justice could possibly strike down the mandate out of honest, reasoned conviction. Solicitor General Donald B. Verrilli Jr. had his hands fulldefending the mandate, not because he’s a bad lawyer, but because it’s not an easy question.

If the federal government can force young adults to buy health insurance that they do not want, then what can’t the government do? That was the challenge from the mandate’s opponents. Liberal justices tried to come up with other cases where the government forces citizens to take affirmative action — to have pollution controls installed on their cars, to drive faster than 45 mph on the freeway. But no one has to buy a car, and you can choose to stay off the interstate.

Well, mostly right.  Contra Justice Breyer, while Congress has used the spending power to force states to establish a 55 MPH speed limit, it did not pass the limit itself, did not enforce it, and has never ordered a minimum speed limit (which is what Breyer needed, since he was claiming the Federal Government had the power to order people to do things, rather than to refrain from doing something).

Carvin: Government creating a problem doesn’t give the Federal Government new powers to “solve” it

March 29, 2012

It’s been a joy reading the transcripts of the Individual Mandate debate, because everything I wanted the Individual Mandate opponents to say, they said.

JUSTICE GINSBURG: Well then, what about the determination that they can’t possibly work if people don’t have to buy insurance until they are — their health status is such that the insurance company just dealt with them on its — as it will? They’d say, I won’t insure you because you’re — you’re already sick.

MR. CARVIN: It depends what you mean by work.” It’ll work just fine in ensuring that no sick people are discriminated against. What — what — but when you do that — Congress -­

JUSTICE GINSBURG: But the sick people, why would they insure early if they had to be protected if they get insurance late?

MR. CARVIN: Yes. Well, that’s — see, this is the government’s very illogical argument. They seem to be saying, look, we couldn’t just force people to buy insurance to lower health insurance premiums. That would be no good. But we can do it because we’ve created the problem. We, Congress, have driven up the health insurance premiums, and since we’ve created that problem, this somehow gives us authority that we wouldn’t otherwise have. That can’t possibly be right.

MR. CARVIN: There is no moral dilemma between having people have insurance and denying them emergency service. Congress has made a perfectly legitimate value judgment that they want to make sure that people get emergency care. Since the founding, whenever Congress has imposed that public responsibility on private actors, it has subsidized it from the Federal Treasury. It has not conscripted a subset of the citizenry and made them subsidize the actors who are being hurt, which is what they’re doing here.

MR. CARVIN: It is clear that the failure to buy health insurance doesn’t affect anyone. Defaulting on your payments to your health care provider does. Congress chose, for whatever reason, not to regulate the harmful activity of defaulting on your health care provider. They used the 20 percent or whoever among the uninsured as a leverage to regulate the 100 percent of the uninsured.

Justice Breyer, Tool and Fool

March 29, 2012

Justice Breyer makes an ass out o himself, and Carvin politely helps him figure that out:

JUSTICE BREYER: Fine. Then if that’s so, is — let me just change my example under pressure -­ and say that in fact it turns out that percent of all automobiles driving interstate without certain equipment put up pollution, which travels interstate — not percent, maybe only  percent. Does the EPA have the power then to say you’ve got to have an antipollution device? It’s statistical.

MR. CARVIN: What they can’t do — yes, if you have a car, they can require you to have an anti-pollution

JUSTICE BREYER: Then you’re not going on statistics; you’re going on something else, which is what I’d like to know what it is.

MR. CARVIN: It’s this. They can’t require you to buy a car with an anti-pollution device. Once you’ve entered the market and made a decision, they can regulate the terms and conditions of the car that you do, and they can do it for all sorts of reasons. What they can’t do it compel you to enter the market.

JUSTICE BREYER: Now we — now you’ve changed the ground of argument, which I accept as — as totally legitimate. And then the question is when you are born and you don’t have insurance and you will in fact get sick and you will in fact impose costs, have you perhaps involuntarily — perhaps simply because you are a human being — entered this particular market, which is a market for health care?

MR. CARVIN: If being born is entering the market, then I can’t think of a more plenary power Congress can have, because that literally means they can regulate every human activity from cradle to grave. I thought that’s what distinguished the plenary police power from the very limited commerce power. I don’t disagree that giving the Congress plenary power to mandate property transfers from A to B would be a very efficient way of helping B and of accomplishing Congress’s objectives. But the framers -­

JUSTICE BREYER: I see the point. You can go back to Justice Kagan.

It won’t do any good with Justice Breyer, because he couldn’t care less what’s actually in the Constitution.  But it was still a well made point.

Justice Alito: Able to tell the difference between a deadly disease, and the Federal Government

March 29, 2012

Score one for Justice Alito (and Zero for Justice Breyer):

JUSTICE ALITO: Mr. Carvin, isn’t there this difference between Justice Breyer’s hypothetical and the law that we have before us here? In his hypothetical the harm to other people from the communicable disease is the result of the disease. It is not the result of something that the government has done, whereas here the reason why there is cost- shifting is because the government has mandated that. It has required hospitals to provide emergency treatment and, instead of paying for that through a tax which would be born by everybody, it has required — it has set up a system in which the cost is surreptitiously shifted to people who have health insurance and who pay their bills when they go to the hospital.

MR. CLEMENT: Justice Alito, that is exactly the government’s argument. It’s an extraordinarily illogical argument.

Paul Clement Schools Justice Sotomayor on Federalism

March 29, 2012

Justice Sotomayor throws a spitball, and Clement knocks it out of the park, anyway:

JUSTICE SOTOMAYOR: Could you tell me, do you think the States could pass this mandate?

MR. CLEMENT: I represent States. I do think the States could pass this mandate, but I -­

JUSTICE SOTOMAYOR: Is there any other area of commerce, business, where we have held that there isn’t concurrent power between the State and the Federal Government to protect the welfare of commerce?

MR. CLEMENT: Well, Justice Sotomayor, I have to resist your premise, because I didn’t answer yes, the States can do it because it would be a valid regulation of intrastate commerce. I said yes, the States can do it because they have a police power, and that is the fundamental difference between the States on the one hand and the limited, enumerated Federal Government on the other.

Poor Sotomayor, she just can’t wrap her mind around the fact that the Federal Government’s powers are supposed to be limited.

Paul Clement on Cost shifting

March 29, 2012

MR. CLEMENT: Well, Justice Kennedy, I don’t think that’s right, certainly in any way that distinguishes this from any other context. When I’m sitting in my house deciding I’m not going to buy a car, I am causing the labor market in Detroit to go south. I am causing maybe somebody to lose their job, and for everybody to have to pay for it under welfare. So, the cost shifting that the government tries to uniquely associate with this market — it’s everywhere.

And even more to the point, the rationale that they think ultimately supports this legislation, that, look, it’s an economic decision; once you make the economic decision, we aggregate the decision; there’s your substantial effect on commerce. That argument works here. It works in every single industry.

MR. CLEMENT: Well, Justice Breyer, are other markets that affect every one -­ transportation, food, burial services — though like to talk about that either. There also are situations where there are many economic effects from somebody’s failure to purchase a product.

And if I could — if I could talk about the difference between the health insurance market and the health care market, I mean, ultimately I don’t want you to leave here with the impression that anything turns on that. Because if the government decided tomorrow that they’ve come up with a great — somebody — some private company has come up with a great new wonder drug that would be great for everybody to take, it would have huge health benefits for everybody; and by the way, also, if everybody had to buy it, it would facilitate economies of scale, and the production would be great, and the price would be cheaper — and force everybody in the health care market, the actual health care market, to buy the wonder drug, I’d be up here making the same argument.

MR. CLEMENT: Justice Kagan, again, with all due respect, I don’t think that’s a limiting principle. My unwillingness to buy an electric car is forcing up the price of an electric car. If only more people demanded an electric car, there would be economies of scale, and the price would go down.

MR. CLEMENT: Justice Kagan, first of all, I do think there — this is not the only place where there’s uncompensated care. If some — if I don’t buy a car and somebody goes on welfare, I’m going to end up paying for that as well.

But let me also say that there’s a real disconnect then between that focus on what makes this different and the statute that Congresses passed. If all we were concerned about is the cost sharing that took place because of uncompensated care in emergency rooms, presumably we’d have before us a statute that only addressed emergency care and catastrophic insurance coverage. But it covers everything, soup to nuts, and all sorts of other things.

And that gets at the idea that there’s two kinds of cost shifting that are going on here. One is the concern about emergency care and that somehow somebody who gets sick is going to shift costs back to other policy areas — holders. But there’s a much bigger cost shifting going on here, and that’s the cost shifting that goes on when you force healthy people into an insurance market precisely because they’re healthy, precisely because they’re not likely to go to the emergency room, precisely because they’re not likely to use the insurance they’re forced to buy in the health care insurance. That creates a huge windfall. It lowers the price of premiums.

And, again, this isn’t just some lawyer up here telling you that’s what it does and trying to second-guess the congressional economic decisions. This is Congress’s findings, Findings (I) on page 43a of the appendix to the Government’s brief.

And then the first point which was — I take it to be the Solicitor General’s point, is, with all due respect, simply a description of the insurance market. It’s not a limiting principle, because the justification for why this is a valid regulation of commerce is in no way limited to this market. It simply says these are economic decisions; they have effect on other people; my failure to purchase in this market has a direct effect on others who are already in the market. That’s true of virtually every other market under the sun.

The second thing is I would urge you to read the license tax case which the Solicitor General says is his best case for why you ignore the fact that a tax is denominated into something other. Because that’s a case where the argument was that because the Federal Government had passed a license, not a tax, that somehow that allowed people to take actions that would have been unlawful under State law, that this was some special Federal license to do something that was forbidden by State law. This Court looked beyond the label in order to preserve federalism there. What the Solicitor General and the government ask you to do here is exactly the opposite, which is to look past labels in order to up-end our basic federalist system.


The National Bank and forced Commerce, and other great Clement lines

March 29, 2012

Justice Breyer tried to pull a fast one, and gets crushed:

JUSTICE BREYER: I’m focusing just on the Commerce Clause; not on the Due Process Clause, the Commerce Clause. And I look back into history, and I think if we look back into history, we see sometimes Congress can create commerce out of nothing. That’s the national bank, which was created out of nothing to create other commerce out of nothing….

So what is argued here is there is a large group of — what about a person that we discover that there are — a disease is sweeping the United States, and 40 million people are susceptible, of whom 10 million will die; can’t the Federal Government say all 40 million get inoculation?

Me: Perhaps yes, but they couldn’t both force them to get inoculated, and force them to pay for it.  But Paul Clement goes in for the kill

MR. CLEMENT: Well, Justice Breyer, let me start at the beginning of your question with McCulloch.  McCulloch was not a commerce power case.

JUSTICE BREYER: It was both?

MR. CLEMENT: No, the bank was not justified and the corporation was not justified as an exercise of commerce power. So that is not a case that says that it’s okay to conjure up the bank as an exercise of the commerce power.

And what, of course, the Court didn’t say, and I think the Court would have had a very different reaction to, is, you know, we are not just going to have the bank, because that wouldn’t be necessary and proper, we are going to force the citizenry to put all of their money in the bank, because, if we do that, then we know the Bank of the United States will be secureI think the framers would have identified the difference between those two scenarios, and I don’t think that the great Chief Justice would have said that forcing people to put their deposits in the Bank of the United States was necessary and proper.

Now, if you look through all the cases you mentioned, I do not think you will find a case like this. And I think it’s telling that you won’t. I mean, the regulation of the wheat market in Wickard against Filburn, all this effort to address the supply side and what producers could do, what Congress was trying to do was support the price of wheat. It would have been much more efficient to just make everybody in America buy 10 loaves of bread. That would have had a much more direct effect on the price of wheat in the prevailing market.  But we didn’t do that. We didn’t say when we had problems in the automobile industry that we are not just going to give you incentives, not just cash for clunkers, we are going to actually have everybody over 100,000 dollars has to buy a new car


MR. CLEMENT: Well, with respect, Mr. Chief Justice, I suppose the first thing you have to say is what market are we talking about? Because the government — this statute undeniably operates in the health insurance market. And the government can’t say that everybody is in that market. The whole problem is that everybody is not in that market, and they want to make everybody get into that market.

MR. CLEMENT: Well, Justice Kagan, I’m not sure that’s right. I think what health insurance does and what all insurance does is it allows you to diversify risk. And so it’s not just a matter of I’m paying now instead of paying later. That’s credit.  Insurance is different than credit. Insurance guarantees you an upfront, locked-in payment, and you won’t have to pay any more than that even if you incur much great expenses.

The Individual Mandate, Justification v. reality

March 29, 2012

Chief Justice Roberts and Justice Alito focuse on the disconnect between the excuse for the IM, and the reality:

CHIEF JUSTICE ROBERTS: The key in Lochner is that we were talking about regulation of the States, right, and the States are not limited to enumerated powers. The Federal Government is. And it seems to me it’s an entirely different question when you ask yourself whether or not there are going to be limits on the Federal power, as opposed to limits on the States, which was the issue in Lochner.

CHIEF JUSTICE ROBERTS: Well, but it’s critical how you define the market. If I understand the law, the policies that you’re requiring people to purchase involve — must contain provision for maternity and newborn care, pediatric services, and substance use treatment. It seems to me that you cannot say that everybody is going to need substance use treatment or pediatric services, and yet that is part of what you require them to purchase.

GENERAL VERRILLI: Well, it’s part of what the statute requires the insurers to offer. And I think the reason is because it’s trying to define minimum essential coverage because the problem

CHIEF JUSTICE ROBERTS: But your theory is that there is a market in which everyone participates because everybody might need a certain range of health care services, and yet you’re requiring people who are never going to need pediatric or maternity  services to participate in that market.

JUSTICE ALITO: Are you denying this? If you took the group of people who are subject to the mandate and you calculated the amount of health care services this whole group would consume and figured out the cost of an insurance policy to cover the services that group would consume, the cost of that policy would be much, much less than the kind of policy that these people are now going to be required to purchase under the Affordable Care Act?

GENERAL VERRILLI: Well, while they are young and healthy, that would be true. But they are not going to be young and healthy forever. They are going to be on the other side of that actuarial equation at some point. And of course, you don’t know which among that group is the person who’s going to be hit by the bus or get the definitive diagnosis. And that

JUSTICE ALITO: The point is — no, you take into account that some people in that group are going to be hit by a bus, some people in that group are going to unexpectedly contract or be diagnosed with a disease that — that is very expensive to treat. But if you take their costs and you calculate that, that’s a lot less than the amount that they are going to be required to pay.  So that you can’t just justify this on the basis of their trying to shift their costs off to other people, can you?

I will admit, it is kind of fun seeing the young people who overwhelmingly voted for the Democrats getting screwed over by the Democrats in return.  Yes, later on they may need more care.  OTOH, later on they will hopefully be making a lot more than they’re making right now.

Justice Scalia’s greatest ObamaCare hits

March 28, 2012

Why do you define the market that broadly? Health care. It may well be that everybody needs health care sooner or later, but not everybody needs a heart transplant, not everybody needs a liver transplant.
Could you define the market — everybody has to buy food sooner or later, so  you define the market as food, therefore, everybody is in the market; therefore, you can make people buy broccoli.

Mr. Verrilli, you could say that about buying a car. If people don’t buy cars, the price that those who do buy cars pay will have to be higher. So, you could say in order to bring the price down, you’re hurting these other people by not buying a car.

One of my favorites. Sorry, but the fact that Congress has passed a law demanding that people do something does not change what is now Constitutionally permitted.

GENERAL VERRILLI: No. It’s because you’re going — in the health care market, you’re going into the market without the ability to pay for what you get, getting the health care service anyway as a result of the social norms that allow — that — to which we’ve obligated ourselves so that people get health care.

JUSTICE SCALIA: Well, don’t obligate yourself to that.

GENERAL VERRILLI: Well, I can’t imagine that that — that the Commerce Clause would — would forbid Congress from taking into account this deeply embedded social norm.

JUSTICE SCALIA: You could do it.

Catching Verrilli unclear on the concept

GENERAL VERRILLI: [I]n the sense that it’s novel, this provision is novel in the same way, or unprecedented in the same way, that the Sherman Act was unprecedented when the Court upheld it in the Northern Securities case; …. And

JUSTICE SCALIA: Oh, no, it’s not. They all involved commerce. There was no doubt that what was being regulated was commerce. And here you’re regulating somebody who isn’t covered.

By the way, I don’t agree with you that the relevant market here is health care. You’re not regulating health care. You’re regulating insurance.  It’s the insurance market that you’re addressing and you’re saying that some people who are not in it must be in it, and that’s — that’s different from regulating in any manner commerce that already exists out there.

And then a truly crushing blow:

JUSTICE SCALIA: Wait. That’s — it’s both “Necessary and Proper.” What you just said addresses what’s necessary. Yes, has to be reasonably adapted.   Necessary does not mean essential, just reasonably adapted. But in addition to being necessary, it has to be proper. And we’ve held in two cases that something that was reasonably adapted was not proper, because it violated the sovereignty of the States, which was implicit in the constitutional structure.  The argument here is that this also is — may be necessary, but it’s not proper, because it violates an equally evident principle in the Constitution, which is that the Federal Government is not supposed to be a government that has all powers; that it’s supposed to be a government of limited powers. And that’s what all this questioning has been about. What — what is left?  If the government can do this, what — what else can it not do?

A question Verrilli never answers, because he has no good answer.

JUSTICE SCALIA: An equally evident constitutional principle is the principle that the Federal Government is a government of enumerated powers and that the vast majority of powers remain in the States and do not belong to the Federal Government. Do you acknowledge that that’s a principle?

GENERAL VERRILLI: Of course we do, Your Honor.

JUSTICE SCALIA: Okay. That’s what we are talking about here.


JUSTICE SCALIA: I don’t understand your point

JUSTICE SCALIA: Whatever the States have chosen not to do, the Federal Government can do?

GENERAL VERRILLI: No, not at all.

JUSTICE SCALIA: I mean, the Tenth Amendment says the powers not given to the Federal Government are reserved, not just to the States, but to the States and the people. And the argument here is that the people were left to decide whether they want to buy insurance or not.

Taking Verrilli to task when he tries to use Community Rating and Guaranteed Issue as excuses for why the Individual Mandate is Constitutional:

JUSTICE SCALIA: You could solve that problem by simply not requiring the insurance company to sell it to somebody who has a condition that is going to require medical treatment, or at least not — not require them to sell it to him at a rate that he sells it to healthy people.   But you don’t want to do that.

GENERAL VERRILLI: But that seems to me to say, Justice Scalia, that Congress — that’s the problem here. And that seems to me -­

JUSTICE SCALIA: It’s a self-created problem.

Justice Sotomayor shows what’s so wrong with ObamaCare

March 28, 2012

JUSTICE SOTOMAYOR: General, I see or have seen three strands of arguments in your briefs, and one of them is echoed today.

The first strand that I’ve seen is that Congress can pass any necessary laws to effect those powers within its rights, i.e., because it made a decision that to effect — to effect mandatory issuance of insurance, that it could also obligate the mandatory purchase of it.

The second strand I see is self-insurance affects the market; and so, the government can regulate those who self-insure.

And the third argument — and I see all of them as different — is that what the government is doing — and I think it’s the argument you’re making today — that what the — what the government is saying is if you pay for — if you use health services, you have to pay with insurance, because only insurance will guarantee that whatever need for health care that you have will be covered, because virtually no one, perhaps with the exception of 1 percent of the population, can afford the massive cost if the unexpected happens.

I think accurately state, and it shows what’s so wrong with ObamaCare

1: What Justice Sotomayor, “General” Verrilli, and the Democrats in Congress and the White House have all missed is that the phrase is “Necessary and Proper“, not just “Necessary”.  While the Individual Mandate is Necessary for the Democrats scheme to work, it is not Proper, and thus it fails.

2: What government ordered health insurance will “guarantee” is that your politically approved “needs” will be met.  But that if the government review board decides your “need” isn’t “needy” enough, you’re toast.  Because no one, not even the US Government, can pay to cover all of everyone’s health care “needs”.  ObamaCare changes who gets to decide, but it doesn’t change that a decision has to be made.

Forcing people to buy broccoli

March 28, 2012

More bits from the transcripts:

JUSTICE SCALIA: Could you define the market — everybody has to buy food sooner or later, so you define the market as food, therefore, everybody is in the market; therefore, you can make people buy broccoli.
GENERAL VERRILLI: No, that’s quite different. That’s quite different. The food market, while it shares that trait that everybody’s in it, it is not a market in which your participation is often unpredictable and often involuntary.

News flash, “General”, your participation in the “food market” is quite involuntary, since if you don’t do it, you die.