D.C. Circuit Court of Appeals: Federal Health Care Subsidies are Illegal

The text of the Affordable Care Act informs us–as Peter Suderman points out–that the ability to dole out subsidies are limited to “Exchange established by the State.” It should therefore surprise precisely no one to find out that federal subsidies for Obamacare–subsidies which are not organized through “Exchange established by the State”–are illegal according to the plain text of the law, and should never have been given out in the first place. More from Suderman:

. . . Case Western University Law Professor Jonathan Adler, who was instrumental in laying the legal groundwork for the case, made the point that this is not the court changing the law. It is the court interpreting the law and its clear language. Which means that any of the ruling’s effects, including the loss of subsidies, were built into the law when it was passed.

“If people lose those subsidies, it’s because the courts rule that those subsidies are and always have been unlawful,” he said. The administration “never had the authority” to dish them out. “Halbig did not cause those effects. Those are the effects of the Affordable Care Act.”

“If that causes dislocation, if that causes disruption, I think the responsibility lies with the IRS and the administration,” Adler also said.

Quite right, of course, although one can easily imagine proponents of the ACA objecting to this common sense observation because it inconveniences them. More from Professor Adler himself, who anticipates the very reaction that I anticipate:

Although this decision is faithful to the text of the PPACA – that is, faithful to the text Congress actually enacted, as opposed to the health care reform some wanted or now wish they had gotten — it will provoke howls of outrage from ACA supporters. (Let the disdain campaign begin.)

To be sure, as Professor Adler himself notes, this is not the end of the matter. The Obama administration will likely seek en banc review of the D.C. Circuit decision, and there are other jurisdictions that have decided the matter differently. I suspect that the case is going to go before the Supreme Court before long, and if it does, one certainly hopes that the Court will decide that words have meaning and that we should respect the actual meaning of words, rather than wishing that words would mean something else, and trying to give those wishes the force of law.

Oh, and of course, the White House’s reaction to the ruling is absolutely precious:

“You don’t need a fancy legal degree to understand that Congress intended for every eligible American to have access to tax credits that would lower their health care costs, regardless of whether it was state officials or federal officials who were running the marketplace,” said Josh Earnest, the White House press secretary. “I think that is a pretty clear intent of the congressional law.”

One thing we can be relatively sure of is the fact that Josh Earnest is in absolutely no danger whatsoever of being able to get “a fancy legal degree.”