The Next Obamacare Fight: Who to Blame
Sometime in the next few weeks, the U.S. Supreme Court will rule on whether the federal government can subsidize people's health insurance in the 37 states that haven't set up Affordable Care Act exchanges. Behind that fight is another one, just as interesting and almost as important: Who gets the blame if the government loses?
The case, King v. Burwell, revolves around a phrase in the law that says insurance subsidies are available on exchanges "established by the state." The plaintiffs and their supporters say this shows Congress meant to use the subsidies as a cudgel to compel states to create their own exchanges. Now that the strategy has failed, they argue, with some states refusing to build exchanges and instead defaulting to the one run by the federal government, the government should accept the consequences and withdraw those subsidies.
Obamacare proponents say that's not what Congress intended. They insist the phrase in question was never intended to restrict subsidies, and instead amounts to a typo -- one that conservatives have exploited at the expense of the newly insured.
Why does this debate matter to anyone but the pundits? After all, it's not clear how much the question will influence the court's ruling. "The statutory text -- not only the 'established by the State' language, but the entire statute -- is what matters most," Nicholas Bagley, a University of Michigan law professor who has written extensively on Obamacare, told me. My Bloomberg View colleague Megan McArdle notes that the government hasn’t even made the "drafting error" argument part of its case.
The more significant impact of the debate over intent, if the court rules for King, comes in two parts. The first involves the Republican Party's image: If a consensus forms that conservatives stripped 8 million people of health insurance because they insisted on litigating a typo, that plays into the Democratic narrative of a party that's poorly attuned to the financial concerns of middle-class voters.
On the other hand, if Obamacare's opponents can convince the public that Democrats brought this on themselves (by trying to coerce state governments and then changing their story when that approach didn't work), those opponents can try to avoid taking the blame for people losing their insurance. The inability of Republicans to agree on a legislative alternative in the event of a ruling for King only underlines how messy those consequences could be.
But the fight over what Congress had in mind when it passed Obamacare -- and, by extension, who to blame if the law loses in the court -- is about something broader than electoral repercussions. That fight could also influence the way Americans view the legitimacy, and limits, of Democrats' efforts to expand the social safety net.
If the court rules against the government based on what comes to be interpreted as a technicality, the law will suffer. But that outcome doesn't necessarily weaken the idea of Obamacare (or something like it) in the public imagination. It mostly instructs future Democratic Congresses to be a little more diligent about proofreading next time.
But if the law's opponents convince the public that Obamacare's defeat in court stems from a fundamental feature of the law -- in this case, a surreptitious attempt to force the states to adopt a liberal agenda -- then conservatives will have accomplished more than undercutting Obamacare. They'll also have helped delegitimize it, supporting the view that government can't address inequality without screwing something up.
Of course, which side wins this debate is separate from which side can lay a stronger claim to the facts. The reporting on what Congress actually had in mind is by now exhaustive, and it includes an article this week by the New York Times' Robert Pear, in which even the Republicans involved in writing the law said nobody intended to block subsidies to states that didn't build their own exchanges.
Whether that reporting is enough to settle the debate won't be clear until after the court's ruling. If the government loses, people who haven't had much reason to care about health-care politics will be left wondering who to blame for taking their coverage away. That's when the fight about congressional intent -- and who we have to thank for King v. Burwell -- will morph from an argument among wonks into something more significant.
This column does not necessarily reflect the opinion of Bloomberg View's editorial board or Bloomberg LP, its owners and investors.
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