Patterico's Pontifications

7/8/2014

Halbig in a Nutshell

Filed under: General — Patterico @ 7:49 am

If all the legalese has your head spinning, here’s all you need to know:

1) The text of the ObamaCare law makes subsidies available only to one who enrolls in a health plan “through an Exchange established by the State under [section] 1311.”

2) The ObamaCare law says that if a State does not establish the exchange, “the [HHS] Secretary shall . . . establish and operate such Exchange within the State.”

3) Follow me here: when the HHS Secretary establishes an exchange, the exchange was established by the HHS Secretary.

4) The HHS Secretary is not a “State.” A State is defined in the ObamaCare law as “each of the 50 States and the District of Columbia.”

5) So when the exchange was established by the Secretary, it was not established by a “State.”

That’s pretty much it.

By the way, the D.C. Circuit put out four new opinions today, and none of them was the Halbig decision. I can’t guarantee they won’t put out any more today, but it’s looking like Friday at the earliest.

33 Responses to “Halbig in a Nutshell”

  1. What does “The State” mean?

    Leviticus (c3237f)

  2. Obama supporters say the Secretary must establish “such” exchange — meaning it’s the same type of exchange as the ones established by the State. Sure, they say, it says “established by the State under 1311″ and the Secretary does it under section 1321 — but the Secretary basically steps into the shoes of the State and sets up the same type of exchange — a state exchange.

    Wonderful argument. But it was still established by the Secretary.

    End of story, end of case.

    Patterico (9c670f)

  3. A State is defined in the ObamaCare law as “each of the 50 States and the District of Columbia.”

    Did I need to make that one of the points? Maybe I should have.

    Patterico (9c670f)

  4. I’ll add it to 4.

    Patterico (9c670f)

  5. Done. That’s better. Thanks.

    Patterico (9c670f)

  6. Patterico: 5) So when the exchange was established by the Secretary, it was not established by a “State.”

    But if that’s the case, is it not then also not “such Exchange within the State.”

    Is the law then directing the Secretary of HHS to do something the Secretary of HHS cannot do?

    But it was still established by the Secretary

    Better: It was established under Section 1321, and not Section 1311.

    The question is, are exchanges established under Section 1321 identical in nature to those established under Section 1311? If not, what is the Secretary of HHS being directed to do?

    Sammy Finkelman (d22d64)

  7. I think the key point is that any exchange established by the Secretary of HHS was established under Section 1321, and not under Section 1311.

    The tax credit language speaks about exchanges established under Section 1311. That’s more important language than the idea of it being established by a state, which is just excess verbiage.

    Are exchanges established under Section 1321 identical in nature to those established under Section 1311?

    If not, what is the Secretary of HHS being directed to do??

    The law did not contemplate anything like healthcare.gov, by the way, but rather independent exchanges for every state that did not establish one.

    (Healthcare.gov presumably complies with the law by regarding each part of healthcare.gov that deals with a separate state as a separate exchange, and tghey indeed have dofferent policies and prices and Medicaid requirements.)

    Sammy Finkelman (d22d64)

  8. “I think the key point is that any exchange established by the Secretary of HHS was established under Section 1321, and not under Section 1311.

    The tax credit language speaks about exchanges established under Section 1311.”

    Sammy – If you want to take that angle, Section 1321 lays out the conditions under which the Secretary may elect to establish an exchange, the relevant ones being when a state elects not to establish one of its own or when a state will not have one which in the judgement of the Secretary is functioning in compliance with the law. Under those circumstances the federal government can construct an exchange for a state under its own initiative.

    daleyrocks (bf33e9)

  9. <blockquoteSammy – If you want to take that angle, Section 1321 lays out the conditions under which the Secretary may elect to establish an exchange, the relevant ones being when a state elects not to establish one of its own or when a state will not have one which in the judgement of the Secretary is functioning in compliance with the law. Under those circumstances the federal government can construct an exchange for a state under its own
    initiative.Yes, but why is that relevant? The key point, as Sammy says, is that any exchange that the Secretary establishes, even if it’s identical to a Section 1311 exchange, isn’t one. It’s a Section 1321 exchange. And the subsidy explicitly says it applies only to Section 1311 exchanges.

    Suppose Article 4 of the constitution were amended to say that if Congress does not establish inferior courts in a state, as provided for in Article 3, the state legislature may establish such courts. Now suppose a law specifically referred to Article 3 judges. Would that law cover a judge on a court established under Article 4? I think not. Article 4 courts may be functionally identical to Article 3 courts, but they are not Article 3 courts.

    Milhouse (b95258)

  10. Oops.

    Sammy – If you want to take that angle, Section 1321 lays out the conditions under which the Secretary may elect to establish an exchange, the relevant ones being when a state elects not to establish one of its own or when a state will not have one which in the judgement of the Secretary is functioning in compliance with the law. Under those circumstances the federal government can construct an exchange for a state under its own
    initiative.

    Yes, but why is that relevant? The key point, as Sammy says, is that any exchange that the Secretary establishes, even if it’s identical to a Section 1311 exchange, isn’t one. It’s a Section 1321 exchange. And the subsidy explicitly says it applies only to Section 1311 exchanges.

    Suppose Article 4 of the constitution were amended to say that if Congress does not establish inferior courts in a state, as provided for in Article 3, the state legislature may establish such courts. Now suppose a law specifically referred to Article 3 judges. Would that law cover a judge on a court established under Article 4? I think not. Article 4 courts may be functionally identical to Article 3 courts, but they are not Article 3 courts.

    Milhouse (b95258)

  11. And the reason the statute doesn’t say “in the state” is because the Federal Government was attempting to encourage the states to do all the “establishing.” That language was a feature, not a bug.

    SarahW (267b14)

  12. “Yes, but why is that relevant?”

    Milhouse – It is not. Sammy’s points are not relevant, but he sometimes confuses other people with his squid ink by not explaining his points. More information is usually better.

    daleyrocks (bf33e9)

  13. O care is such bad law. When it is discovered what’s in it, the strategy so far has been to say “aw hell just go with the flow, if we don’t blot out inconveniences like that it won’t work.”

    Welcome to your nanny republic. Your betters will figure it all out, the “law’ is just for show.

    SarahW (267b14)

  14. O care is such bad law. When it is discovered what’s in it, the strategy so far has been to say “aw hell just go with the flow, if we don’t blot out inconveniences like that it won’t work.”

    I don’t think they cared what was in the law. I don’t think they thought it would work, and that was a feature, not a bug. It was a step toward single-payer, nothing more, nothing less. Once the public learns the dollar amount the insurance companies are getting reimbursed to keep this monstrosity afloat, what do you think is going to happen? Who do you think is going to accept blame? It ain’t gonna be ∅!

    Hadoop (f7d5ba)

  15. Some comments here have suggested that the Secretary has the power to “establish such exchange” if the State doesn’t – I don’t think that’s correct. Rather, the Secretary is obligated to establish one (PPACA, Sec 1321(c)). Of course, if Halbig is correct, then the “exchange” that the Secretary is obligated to establish will also be legally barred from functioning as a QHP exchange (Sec 1312(f))

    Ken Kelly (f754a2)

  16. Milhouse – It is not. Sammy’s points are not relevant,

    Often they are, and that is certainly the case here. The key point is indeed that the subsidies explicitly apply only to Section 1311 exchanges, and the federal exchanges, no matter who established them, are Section 1321 exchanges, not Section 1311. This is at least as important as the fact that the Secretary is not a state.

    Milhouse (b95258)

  17. “Often they are, and that is certainly the case here.”

    Milhouse – I was referring to this thread. Sammy is essentially repeating what he said yesterday. Explaining what can trigger HHS intervention in the creation of an exchange, especially an opt out date under the Act is relevant for understanding the difference between 1311 and 1321, but should have no bearing on the litigation.

    daleyrocks (bf33e9)

  18. “Often they are, and that is certainly the case here.”

    Milhouse – I don’t understand your logic. If you believe Sammy’s points are relevant, why were you questioning why explaining whether me explaining the triggering provisions of 1321 were relevant? I’ve been misreading your comment.

    If you believe Sammy’s comments are relevant than my responses to him providing context are relevant as well.

    daleyrocks (bf33e9)

  19. Because I don’t see how it matters why the Secretary established the federal exchanges, or what criteria Section 1321 laid out for their establishment. All that matters is that 1) the Secretary is not a state, and 2) Section 1321 is not Section 1311. The details just obscure these key points.

    Milhouse (b95258)

  20. The issue just aired on FOX NEWS. According to the law, subsidies are only available on exchanges established by the states, subsidies are not available on exchanges established by federal agencies.

    The administration’s heated rush to roll-out ObamaCare resulted in ignoring the cross-checks and verifications necessary to establish eligibility for subsidies. Now their malfeasance has come back to bite them in the ass.

    ropelight (c72915)

  21. The bill was not written carefully.

    What you need to do to determine if this is a problem is to see if there are other bills that were written in similar ways but where an interopretation like the one the administration has was upheld.

    It’s true they lost the ability to amend it except through the reconciliation process, but shouldn’t they have been able to add Section 1321 exchanges because it’s a budgetary matter? So did they still overlook this weeks later or so when they passed the second bill that took out the Cornhusker kickback (exempting Nebraska from paying for Medicaid expansion – ever)

    Sammy Finkelman (d22d64)

  22. 15. Ken Kelly (f754a2) — 7/8/2014 @ 9:24 am

    Of course, if Halbig is correct, then the “exchange” that the Secretary is obligated to establish will also be legally barred from functioning as a QHP exchange (Sec 1312(f))

    Section 1312 doesn’t seem to define an exchange, but it does refer to

    … (ii) …the State that established the Exchange

    Sammy Finkelman (d22d64)

  23. Sammy – dizzy yet?

    JD (8ffd8d)

  24. Dear America,

    I told you that we’d have to pass the bill in order to find out what’s in it !

    Signed,

    Nancy Pelosi

    Elephant Stone (5c2aa0)

  25. I think we should just pretend that the bill means whatever it would if we were the last person on the planet.
    Or something.

    Elephant Stone (5c2aa0)

  26. Laws are for little people!
    - B. Obama

    askeptic (efcf22)

  27. You’ll get no argument from me. It’s just odd that no one here notes that question of subsidies on the FFM’s is a complete red herring. Exchanges are marketplaces for QHPs. The only people who can buy QHPs on exchange are, by law, “resident in the State that established the exchange” (1312(f)). So no one is legally allowed to buy a QHP on an FFM anyway. Odd that Adler & Cannon didn’t make that obvious argument.

    I wonder why.

    Ken Kelly (f754a2)

  28. 22. Sammy Finkelman (d22d64)

    You’ll get no argument from me. It’s just odd that no one here notes that question of subsidies on the FFM’s is a complete red herring. Exchanges are marketplaces for QHPs. The only people who can buy QHPs on exchange are, by law, “resident in the State that established the exchange” (1312(f)). So no one is legally allowed to buy a QHP on an FFM anyway. Odd that Adler & Cannon didn’t make that obvious argument.

    I wonder why.

    Ken Kelly (f754a2)

  29. The bill was not written carefully.

    What you need to do to determine if this is a problem is to see if there are other bills that were written in similar ways but where an interopretation like the one the administration has was upheld.

    Sammy Finkelman (d22d64) — 7/8/2014 @ 2:30 pm

    No, you don’t look at other bills, you don’t try to devine intent, you go by the language of the law. If the law isn’t clearly written, then congress needs to fix the law.

    Tanny O'Haley (87b2aa)

  30. 29. No, you don’t look at other bills, you don’t try to devine intent, you go by the language of the law. If the law isn’t clearly written, then congress needs to fix the law.

    Tanny O’Haley (87b2aa) — 7/9/2014 @ 8:17 am

    The problem (for the Left) is that, concerning this issue at least, the law is clearly written. They are simply asking the courts to provide the votes to approve the language they now wish they had, but don’t have the votes in Congress to get. And didn’t’ have even back when this abomination had to be passed via reconciliation, due to the election of Scott Brown.

    You can’t find a clearer example of the administration asking the courts to legislate from the bench than this.

    Steve57 (cd4182)

  31. What do you make of the use of the word “such” in “such Exchange”?

    dan (b4bbe4)

  32. Oh I see you addressed that in the comments.

    dan (b4bbe4)

  33. Tanny O’Haley (87b2aa) — 7/9/2014 @ 8:17 am

    No, you don’t look at other bills, you don’t try to devine intent, you go by the language of the law. If the law isn’t clearly written, then congress needs to fix the law.

    I don’t think this is the first time U.S. courts have encountered badly dfrafted bills.

    Some obvious errors or unanticipated loopholes are usually fixed in a “technical corrections” bill.

    Sammy Finkelman (d22d64)


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