ObamaCare and the Language of Law

ObamaCareby Jon N. Hall    10/29/14
On Sept. 30, Judge Ronald A. White of the U.S. District Court for the Eastern District of Oklahoma delivered his decision in Pruitt v. Burwell, the third of four related cases to have received a judgment. The four cases challenge the IRS ruling that ObamaCare subsidies will be given to policyholders who’ve purchased health insurance in exchanges established by the federal government. Like the verdict in Halbig v. Burwell, Judge White found for the plaintiffs and against the IRS, and he vacated the IRS regulation pending appeal. The other case to have received a judgment is King v. Burwell, which found for the government. So we have a 2-1 split. The U.S. Supreme Court must eventually weigh in.

In an article at National Review just after the Halbig decision, Kevin Williamson dilated on the importance of “the written law.” Federal judges might take to heart one of his formulations: “law is nothing if not language.”

In the text of ObamaCare there are 58 iterations of the word “behalf,” and not a one of them is connected to “State.” In the Halbig dissent (text) there are 18 iterations of the word “behalf” and each and every one of them is connected to “State,” such as “on the State’s behalf” or “on behalf of the State.” So when the dissent claims that “the Act empowers HHS to establish exchanges on behalf of the States,” he’s reading his own language into the Act.

The majority opinion in King (text) also buys this “behalf argument.” Of the four iterations of “behalf” in King, two concern “the state”; both on page 20:

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. […]

Given that Congress defined “Exchange” as an Exchange established by the state, it makes sense to read § 1321(c)’s directive that HHS establish “such Exchange” to mean that the federal government acts on behalf of the state when it establishes its own Exchange. [Italics added.]

That’s not what SEC. 1321(c) of the ACA says, which is: “… the Secretary shall (directly or through agreement with a not-for-profit entity) establish and operate such Exchange within the State and the Secretary shall take such actions as are necessary to implement such other requirements.” (Page 186) When the dissent in Halbig and the majority opinion in King write about the feds having established exchanges on the State’s “behalf,” they’re injecting their own language; there’s no “behalf” connected to “State” to be found in the Act.

Another word that government lawyers have been stressing is “such,” such as in “such exchange.” On page 71 of the oral arguments in Halbig, Mr. Carvin, the lawyer for the appellants, addresses “such”:

The Government erects a cathedral around the word “such” and says that this somehow changes things, it doesn’t change things, all “such” means is they’re not telling the Secretary to set up any old exchange, it’s “such exchange,” they want it to replicate as best they can what’s in the state, but all that tells you is what kind of exchanges, and 36B doesn’t turn on what kind of exchange it is, it turns on who established the exchange. So, when HHS establishes “such exchange” then obviously it is not the state that is establishing “such exchange.” [Quote marks added.]

Williamson begins his NR article: “In the wake of the Halbig decision, liberals sniffed: Surely, Ezra Klein wrote, the Supreme Court is not going to gut the sublime work of policy poetry that is Obamacare in order to ‘teach Congress a lesson about grammar.’” (“Sublime work of policy poetry that is Obamacare”; now that’s language.)

But Halbig isn’t about grammar, and I suspect Klein knows it. There’s nothing ungrammatical about the language in question — “Exchange established by the State” — which appears ten times in the text of ObamaCare. The issue in these four cases is whether there is any other language in ObamaCare that would “undo” that unambiguous language. The other language would also need to be unambiguous; we can’t very well have ambiguous language “undoing” unambiguous language.

To get a different slant on how strained the government’s arguments are, consider this hypothetical scenario: ObamaCare clearly stipulates that subsidies are to be granted to policies purchased at state exchanges AND to policies purchased at federal exchanges, but after the law is enacted the IRS rules that it’s only going to grant subsidies to policies purchased at federal exchanges, (perhaps because the subsidies are getting too expensive). Such an IRS ruling would have lawyers filing suits all over the place, and rightly so. What that hypothetical happens to be is an analog of the situation now before the courts.

Those who think that the lack of clarity in ObamaCare is attributable to some “drafting error” should read the article by Sean Davis at The Federalist that came out the day after the decision in Halbig. That the several States understood the availability of federal subsidies in the way alleged by the plaintiffs in these cases was demonstrated by Britanny La Couture at American Action Forum: “Building the Case for Halbig v. Burwell: What States Knew

One problem for the government’s lawyers arguing for the retention of the IRS rule is that Congress has no authority to command the States to set up exchanges. If Congress did have that power, then why are the 34 States that have refused to establish exchanges not being sued by the feds? It’s because Congress can’t commandeer the apparatus of the States to fulfill a federal purpose. You see, in the United States of America we have a little thing called “dual sovereignty.” The States didn’t enact ObamaCare; the feds did. And the feds didn’t “give” the States the option to opt out of ObamaCare; the States already possessed that option.

ObamaCare is a federal program; compliance is handled by a federal agency, our beloved IRS. In establishing federal exchanges, the feds weren’t doing anything on “behalf” of the States.

Here’s where it gets messy. If the Supreme Court sides with the plaintiffs in these cases, then the IRS illegally dispersed a lot of taxpayer money to private insurance companies, which they continue to do. Will the IRS demand that it be returned? But the insurance companies will surely have paid out some of that money to settle insurance claims; they may have paid for expensive surgeries like coronary bypass operations. So who’s going to take the financial hit if the subsidies are found to be illegal: the insurance companies or the taxpayer?

That dilemma is just one reason why the Supreme Court should fast-track these cases before any more possibly illegal subsidies are handed out. The continuing abuse and degradation of language is another.

(NOTE: Forbes ran an interesting analysis of the ruling in Pruitt by Michael Cannon that’s worth reading; it appeared on the day Judge White delivered his ruling. For more on these IRS cases, see my last article.)
Jon N. Hall is a programmer/analyst from Kansas City. • (1639 views)

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9 Responses to ObamaCare and the Language of Law

  1. Timothy Lane says:

    These cases are simply another example of how liberals believe in arbitrary rule by a despot rather than the rule of law. The latter requires knowing what the law is, which means that the letter of the law matters. But liberals believe that the only thing that matters is what they want, regardless of what the law says.

    • David Ray says:

      Half the fun/agony is naming the Supreme Court justices that chose popularity over actual honor.
      If ever there was a psychological observation it’s this: Ours have an agonizing habit of flipping over. Liberal judges don’t.
      It’s no wonder that WWIII starts every time a Republican nominates a justice.

      Ann Coulter was so right. she insisted on asking: “Just who is this this chief justice nominee John Roberts?”
      Well now we know. He’s the one who prefers favorable press reports over reading what’s written. (Oh well. At least Bush didn’t shackle us with Harriet Miers . . . Damned decent of him.)

      • Anniel says:

        Don’t you ever wonder what might be out there on John Roberts he got threatened with? I hate to think that way, but after all the savaging that goes on in politics one does have to wonder. I get mad at Glenn Beck, but one thing he had right – Confess your own sins BEFORE your enemies do.

  2. Anniel says:

    I very much believe that if only ONE person is granted a waiver from a law, then it is no longer a law, and anyone else MUST be granted the same waiver. Philip Hamburger’s book “Is Administrative Law Unlawful” (warning: Written in truly legal fashion) should be read by anyone interested in how to stop the nonsense that is ObamaCare.

    • Timothy Lane says:

      If the law allows such waivers, then they remain lawful. To be sure, if they’re arbitrary (and ultimately, anything dependent on the discretion of a public official is arbitrary no matter what standards nominally apply) it’s a poor law, but a law nonetheless.


        I’m not sure, Tim, but there may have been early cases in American law holding that an act which treated citizens differently by class was void. After all, the reason we don’t allow titles of nobility is to prevent having two classes of citizens with different legal statuses. And there can be no equality under the law if some persons are granted “waivers” from compliance. Certainly Obama’s granting of “waivers” is completely illegal as the President is given no such power under the Constitution. And of course the Democratic Left is busy doing its best to erect a permanent governing class that can never be removed by elections – the new aristocracy.

        I’ll research this matter further when I have time.

  3. GHG says:

    The U.S., as a nation of laws, is so far removed from what started as a federation of states, there doesn’t seem to be a way to untangle the mess. It was probably inevitable under the best of intentions, but the left’s misusing and abusing the law has made it so much worse.

    We have to pass the bill before we find out what’s in it. They passed the bill and we still don’t know what’s in it, or how it will be interpreted. policy poetry indeed.

    • Timothy Lane says:

      What it means is that Patrick Henry and his fellow opponents of the Constitution were right after all, though the Articles of Confederation were also unworkable in terms of running an effective government.


    Thanks for the update, Jon. I would like to remind those who perhaps haven’t followed this particular aspect of the fight against Obamacare of another fact which shatters the government’s case: the Democratic drafters of the law are known to have specifically limited Federal subsidies to states that established “exchanges” as a means of pressuring the states to do so, since Congress had no authority to require any state to set up an “exchange”. This is the same method of extortion Congress has used before to club the states into submission: use the taxing power to take the state’s money (i.e., money belonging to the citizens of the state), and then refuse to give any of it back except under conditions. Thus the state would be cruelly taxed to fund Obamacare, and only get some of its money back (in the form of subsidies) by obeying Big Brother and setting up an exchange.

    It is entirely fitting that the Left’s attempt to browbeat the states into submission should backfire against them and help bring down Obamacare.

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