Courtesy of “the Stupidity of the American Voter”: Obamacare Enters Year Two Amidst New Challenges

It’s not shaping up to be a happy birthday for the little scamp known as the Patient Protection and Affordable Care Act, affectionately referred to as Obamacare. On Friday, it was announced that the Supreme Court would hear the case of King v. Burwell, a lawsuit centered around some ambiguous language found in the 2010 bill. A negative verdict for the Obama administration could spell doom for the President’s signature legislation, potentially pulling the thread that unwinds the garish, ill-fitting Christmas sweater that is federally-mandated health care.

The legal challenge focuses on the difference between state and federal health exchanges, and whether subsidies currently being given to individuals enrolled in the latter are actually permitted under the law. The Obamacare bill sought to induce each state to create its own health care marketplace; in instances where a state refused to act (as has been the case in a number of states run by Republican governors), the federal government would step in and create its own marketplace. Since the PPACA’s implementation, both the 14 state and 36 federal exchanges have offered subsidies to health care enrollees, defraying costs based on the recipient’s level of income. The problem for Obamacare proponents is that the actual wording in the law only allows for subsidies in exchanges “established by the state.” Whoops.

If the Justices decide to take a literal interpretation of the law’s wording (and the simple fact that they have agreed to hear the case indicates that at least four of them believe the plaintiffs’ arguments have merit), it could be disastrous for Obamacare. As Jason Millman writes at the Washington Post:

A Rand Corporation study last month helps explain just why the subsidy challenge is a huge deal. Of the 5.4 million people who signed up for health insurance on federal-run exchanges this past year, 87 percent of them received subsidies.

So if you take away those subsidies from the marketplaces, here’s what Rand says what would happen in 2015, as I wrote last month:

Premiums would be 43.3 percent higher on average in the individual market in 2015, while enrollment — on and off the exchanges — would drop by 68 percent, according to the research firm’s microsimulation model. In all, 11.3 million fewer Americans would have health insurance, according to its analysis.

An important caveat: The Rand projection includes state-run marketplaces in 14 states and the District of Columbia, which aren’t being challenged by these cases. So the effects would be at least somewhat smaller than what the Rand projection found.

If you remove the subsidies from the federal exchanges, a large percentage of the healthy, young Americans currently enrolled would be inclined to drop out, leaving only the sick and the elderly. Bereft of the former demographic, which sets the entire Rube Goldberg machine in motion by paying for insurance while hardly using it, carriers would be forced to enact exorbitant premium increases, eventually causing the whole darned thing to collapse under its own weight. At that point, the law would only be saved if the House and Senate chose to amend it, or if governors set up exchanges in states that currently lack them. Hmmm. House, Senate and governors… didn’t I read something about them recently? Ah yes, that’s right.

Not surprisingly, Democratic politicians, analysts, strategists and that guy sipping a Classic Chai Tea Latte at Starbucks have fallen all over themselves to proclaim that, “THAT’S NOT WHAT THEY MEANT WHEN THEY WROTE THE BILL!” Apparently, former Mathachuthetts Congrethman Barney Frank didn’t get the memo [h/t Newsbusters]:

According to Barney, “people obviously did not expect there to be the kind of political outcome there was and they did not expect so many states to reject [the exchanges]” and the people who wrote the bill “wrote it not anticipating what was a reality and clearly if they — if we could rewrite it or they could rewrite it, I’m not there anymore, they would do it.”

And then there’s Dr. Jonathan Gruber, who President Obama surely would love to torture today if President Obama believed in those sorts of things. As the Cato Institute’s Michael Cannon (who helped initiate the King lawsuit) wrote in July,

Gruber was an architect of both the PPACA and its Massachusetts precursor, “RomneyCare.” In 2009 and 2010, he was a highly paid advisor to the Obama administration during the congressional debate that produced the PPACA. According to the New York Times, “the White House lent him to Capitol Hill to help Congressional staff members draft the specifics of the legislation.” … Gruber boasts of having written part of the PPACA. He boasts to theTimes, “I know more about this law than any other economist.” He’s probably right about that.

So what does the man who “knows more about this law than any other economist” think of this latest legal challenge? Well, if you ask him today, he’d probably use words like “screwy”, “nutty” and “stupid”. But back in 2012, he had a decidedly different take:

The pertinent piece, as highlighted by Cannon:

In the law, it says if the states don’t provide [exchanges], the federal backstop will. The federal government has been sort of slow in putting out its backstop, I think partly because they want to sort of squeeze the states to do it. I think what’s important to remember politically about this, is if you’re a state and you don’t set up an Exchange, that means your citizens don’t get their tax credits. But your citizens still pay the taxes that support this bill. So you’re essentially saying to your citizens, you’re going to pay all the taxes to help all the other states in the country. I hope that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these Exchanges, and that they’ll do it. But you know, once again, the politics can get ugly around this.

In other words, the language in question was purposeful, an attempt on the part of the bill’s Democratic drafters to coerce governors into offering exchanges rather than face the wrath of unhappy constituencies.

Gruber has also made other news today, as a 2013 video of him was uncovered in which he reveals more stuff-that-liberals-pretend-is-bat$#!t-crazy-when-Rush-Limbaugh-says-it-but-then-brag-about-when-they-think-no-one-is-looking:


Once again, the man who “knows more about this law than any other economist” gives away the game, admitting that the bill was written so that the Congressional Budget Office would not score the individual mandate as a tax, and that the whole point of the legislation is to have healthy people pay for the sick. How did it eventually get passed?

“Lack of transparency is a huge political advantage. And basically, call it the stupidity of the American voter or whatever, but basically that was really, really critical for the thing to pass… Look, I wish Mark was right that we could make it all transparent, but I’d rather have this law than not.”

Gruber reveals Obamacare for what it is: an attempt by a small cadre of liberal academics and technocrats to force their ideology on the masses using lies and misdirection. So onerous were the law’s provisions, and so antithetical to the independent American spirit were its requirements, that only through the use of “tortured language” could they fool the public into accepting it.

In the end, the very obfuscations that helped Obamacare’s passage may prove to be its undoing.