It’s an odd world in which judges are accused of usurping the role of Congress for ruling that the executive branch must follow the text of a law Congress wrote. But that’s what has happened today. In Halbig v. Burwell, the D.C. Circuit Court of Appeals ruled that Congress never gave the federal government power to provide subsidies and assess penalties under the Affordable Care Act in states that haven’t established their own health-insurance exchanges.
President Obama and the Congress that passed the law assumed this wouldn’t be a problem: States were expected to go along and establish their own exchanges. When it became clear that many states wouldn’t do so because the law was so unpopular, the IRS just rewrote the law. (It didn’t get any more popular.) Since the IRS made its move, the Democrats who wrote the law have maintained that they intended it that way from the beginning. But the wording they wrote into the law a couple of years before clearly requires otherwise, and that’s what matters.
Thus the ruling from the D.C. Circuit, although a panel from the Fourth Circuit ruled the opposite, also today, arguing that the IRS had reached a plausible interpretation of Obamacare’s text.
The case will likely go to a full hearing of the D.C. Circuit, and then potentially to the Supreme Court. Obamacare partisans who cry that unelected solons are trying to strike down a law duly passed by Congress have it backwards: The legislature’s text was mangled by the unelected IRS, and it’s the proper role of the courts to set this matter straight, as the D.C. Circuit did.
It will be hard for the law to survive without the subsidies the IRS decided to provide on the federal exchange. If the D.C. Circuit’s ruling holds, some states may establish their own exchanges, but where they do not, individuals on the federal exchanges will see their share of their premiums rise significantly. This is undoubtedly a problem, but it’s a problem created by the unpopularity of the law and its flawed design, not by Republicans who never wanted it in the first place.
Obamacare has already disrupted coverage for millions of Americans, and insisting that it be followed as long as it is the law will disrupt it for even more. Insisting that the law be followed will also throw the issue back to Congress. Which is another reason that it is past time for them to come up with a replacement for Obamacare that makes coverage possible for roughly the same number of people, or more.