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Greg Sargent’s Own Goal Worse than Previously Believed

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Yesterday I jotted off a quick post about Greg Sargent’s “bombshell” evidence that supposedly disproved the Halbig Plaintiffs’ entire argument, but actually proved it conclusively. At the end of that post I predicted that Sargent’s evidence would be much more likely to be cited by the Plaintiffs (the side he opposes) than the Defendants (the side he favors).

Turns out, Patterico did some digging late last night and found that lo, the plaintiffs in both the Halbig case and the 4th Circuit case (that ruled against the plaintiffs) already cited the exact evidence dug up by Sargent about the HELP Committee language. As Patterico notes (with apologies for the lengthy quote):

But it gets even worse for Sargent. I’ve not seen anyone make this point yet, but Sargent has actually directly corroborated an argument made by the majority opinion in Halbig.Here is the Halbig opinion, and here is the key passage:

The government and its amici are thus left to urge the court to infer meaning from silence, arguing that “during the debates over the ACA, no one suggested, let alone explicitly stated, that a State’s citizens would lose access to the tax credits if the State failed to establish its own Exchange.”

The historical record, however, belies this claim. The Senate Committee on Health, Education, Labor, and Pensions (HELP) proposed a bill that specifically contemplated penalizing states that refused to participate in establishing “American Health Benefit Gateways,” the equivalent of Exchanges, by denying credits to such states’ residents for four years.

This is not to say that section 36B [the section of PPACA that provides for subsidies] necessarily incorporated this thinking; we agree that inferences from unenacted legislation are too uncertain to be a helpful guide to the intent behind a specific provision.

But the HELP Committee’s bill certainly demonstrates that members of Congress at least considered the notion of using subsidies as an incentive to gain states’ cooperation.

Conservatives discussing Halbig have argued that the “established by the state” language was designed to provide an incentive for states to establish exchanges — by withholding subsidies unless the states established the exchanges. Lefties like Sargent say that theory was cynically concocted after the fact. But the Halbig court said, in essence: no, actually, it is not outlandish to think that Congress might have intended to withhold subsidies as an incentive for states to establish exchanges. After all, the HELP Committee did exactly that, in related legislation. The only thing that keeps this from being a slam dunk argument is, we can’t establish a direct connection between the HELP Committee legislation and the language in the PPACA.

He further notes that in the case that was pending before the Fourth Circuit, the Plaintiffs relied heavily on the exact argument that Sargent makes. From the 4th Circuit opinion (see footnote 3, page 27):

The Plaintiffs . . . similarly place too much emphasis on a draft bill from the Senate Health, Education, Labor, and Pensions Committee that would have conditioned subsidies for a state’s residents on the state’s adoption of certain “insurance reform provisions[.]“

So let’s review the bidding:

  1. The draft language from the HELP Committee bill was neither “news” nor a “bombshell”;
  2. It was relied upon, extensively, by the Halbig Plaintiffs – i.e., the people trying to get the subsidies struck down, because contrary to the assertions of Greg Sargent, this is evidence that actually strongly suggests that Congress intended to limit the subsidies to states with exchanges;
  3. This argument was rejected by the D.C. Circuit and the 4th Circuit because the Plaintiffs could not prove a sufficient connection between the HELP Committee bill and the final passed version of PPACA (Obamacare);
  4. Using his connections with people who would have never talked to attorneys for the Halbig plaintiffs, but who would have talked to him as a perceived friendly source, Greg Sargent has now established the definitive connection between the HELP Committee language and the final passed version of the PPACA that the D.C. Circuit and 4th Circuit found lacking; and
  5. Thanks, Greg!

Using all the ordinary canons of statutory construction, this case is now frankly not a very close call. In the first place, the text of the statute itself is clear, and in the second place, there’s no evidence under normal canons of statutory construction that any result other than the result in the Halbig majority should follow. If this were just one of the ordinary bills that face challenges like this, as an attorney, I would much rather be in the position of arguing the plaintiffs’ position than the government’s. In such a hypothetical case, if I were representing the government agency that promulgated this rule, I would be advising them to draw up contingency plans for the rule being struck down and prepare for the likelihood that they would need those contingency plans.

However, this is obviously not an ordinary case about an ordinary statute. Obamacare remains a very hot political football and an ongoing live election issue. Furthermore, the successes and failures of the exchange programs have been a matter of intense public scrutiny, and the difficulties presented by the prospect of unwinding the subsidies in the affected states are not insubstantial. Whether it’s fair or not, these are considerations that matter to courts and they generally have a strong institutional preference for letting Congress fix these problems where they crop up, especially where (as here) large numbers of people have either acted or received benefits based on an agency rule.

Will these countervailing considerations be enough at the Supreme Court to outweigh all the ordinary canons of statutory construction upon which the Supreme Court traditionally relies? I don’t know. But what I do know is that Greg Sargent has made the Plaintiffs’ job in this case measurably easier.

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