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August 01, 2014 3:44 PM The Primary Authority On Who Was Supposed to Qualify for Obamacare Subsidies

By Ed Kilgore

While no one seriously contends that the drafters of the Affordable Care Act intended to make premium tax subsidies only to those participating in state-run insurance exchanges, there’s one authority that would have immediately set off sirens if anyone thought that was a possibility: the Congressional Budget Office, who’s “scoring” of the cost of the law was watched very closely throughout the process.

But as Dylan Scott of TPM points out, CBO never for a moment doubted subsidies were available to those purchasing insurance via federal exchanges:

No one person or institution was more central to the debate over Obamacare than the CBO. Every tweak to the law was funneled through the accounting brains of the non-partisan congressional scorekeeper to determine how much it would cost. Passage of the entire law hinged on its reports. Votes were delayed until CBO could finish its scoring. Specific provisions lived or died by its decrees. It is safe to say that the health care reform law we have today is in large part the result of the CBO’s work.
But like everybody else on Capitol Hill in 2009 and 2010, from legislators to the journalists who covered them, the CBO’s quants never even considered the scenario that Obamacare faces today. A federal appeals court has ruled in Halbig v. Burwell that the law’s crucial subsidies are not available on the federal insurance exchange, HealthCare.gov, putting coverage for nearly 5 million people in 36 states at risk. That outcome, as bad as it would be for the uninsured, would dramatically lower the cost of Obamacare — but the CBO never entertained that possibility for the same reason no one else did: It was not how the law was supposed to work.
Remember: Billions of dollars were at stake and everybody was watching. If the costs of Obamacare subsidies could shift by billions of dollars depending on whether a state built its own exchange or instead used the federal exchange, the CBO would have been the one to know about it. And you can bet that the nervous Obama White House, wavering Democrats, and eager-to-pounce Republicans would have responded if the CBO had interpreted any provision of the bill as putting subsidies at risk to state decision-making and put a figure on the financial fallout of that possible scenario. But that alternative picture of the law’s costs was never created because nobody at the time understood the law to work that way.

It’s increasingly obvious that the only legislative interpretation supporting the D.C. Court of Appeals panel’s decision in Halbig is one that treats the language as a magical incantation that had an affect the opposite of that intended by Congress.

Ed Kilgore is a contributing writer to the Washington Monthly. He is managing editor for The Democratic Strategist and a senior fellow at the Progressive Policy Institute. Find him on Twitter: @ed_kilgore.

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