Wednesday, July 23, 2014

Five Takeaways from Halbig and King

1. The decision on Halbig (D.C. Circuit) isn't taking subsidies away from people nor is the decision on King (4th Circuit) to allow everyone who qualifies to receive a subsidy. It is simply about the law and how it is interpreted. One might also ask how one court ruling said 36 states were federal exchanges while the other ruling said 34 states were federal exchange. This is what happens when a law is poorly written, rushed to a vote, and passes. We end up with a discombobulated mess. This isn't unique to Obamacare. Many other laws that were rushed through end up with unintended consequences too. Obamacare is still full steam ahead on rickety tracks and those who are on board still have ways to purchase heavily discounted tickets. Until further court rulings, these discounted tickets can still be purchased in every state.

2. Media loves a crisis even more than Rahm Emanuel. Coverage of both cases were headline news across the country. But as Bob pointed out yesterday, maybe this isn't such a BFD. The number of people this impacts is less than 2.5% of our population. While that number is projected to rise, CBO figures it will max out at 8% of our population.

3. We are more divided as a nation than ever. Six judges voted exactly along partisan lines for yesterday's rulings. Immediately following the release of Halbig the Twitter world lit up with liberals claiming Republican judges were guilty of Judicial Activism then followed it up - in the same article - with how the White House would request the entire D.C. Circuit Court hear the case and that the court leans 7-4 in favor of democrats. Evidently they don't see this side of it as Judicial Activism.

4. Lobbyists. The American Hospital Association, Association of Health Insurance Plans, and AARP were three of the organizations that filed amicus briefs on behalf of the government in the Halbig case. Obamacare is a gravy train for the people and the businesses they represent. There is no doubt that these groups have some legitimate business concerns surrounding these rulings. But they also see Obamacare as an opportunity. I would expect a very strong grassroots effort by these groups to begin extensive lobbying at the state level. Someone once said elections have consequences. 2014 will no doubt be about Obamacare once again. There are 33 senate seats, all house seats, and 36 governorships up for election this year.

5. Expect a huge push for states to establish their own exchanges over the next several months. Lobbyists and backers of Obamacare will inundate states who didn't set up exchanges. It will also push states that were looking to go from their state based exchange to the federal exchange. The only point agreed upon by all courts is that an exchange established by a state is eligible for federal subsidies. To make this mess go away the only avenue to take is for all 57 states to step up and create their own. For supporters of subsidies, waiting on John Roberts to decide the outcome would be like playing a game of Russian roulette.
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