Don’t Buy the Cooperative-Federalism-Makes-Halbig-Logical-Argument

By Abbe Gluck

Cross-posted at Balkinization and Election Law Blog

I had hope to take a day off blogging about Halbig and King (the ObamaCare Subsidies cases), but I cannot allow another new, and inaccurate, narrative about ObamaCare to take hold. Over at Volokh, Ilya Somin argues that the holding in Halbig is not absurd because Congress uses statutory schemes all the time that try to incentivize states to administer federal law (and penalize them if they don’t).  It is true we see schemes like that all the time–Medicaid is a prime example–but the insurance exchange design at issue in these cases is NOT one of them.  This federalism argument was made before the D.C. Circuit and even Judge Griffith didn’t buy it in his ruling for the challengers.  I tried to dispel this myth back in March, when I wrote the following on Balkanization. As I said there, this isn’t Medicaid—it’s the Clean Air Act.

Read More

Obama Administration to Revise Contraceptives Coverage Accommodation

In response to the SCOTUS decision granting Wheaton College a preliminary injunction against having to comply with the terms of the HHS accommodation available to non-profit religious organizations who object to covering contraceptives for their employees (i.e., submitting a form to their insurance providers), the Obama Administration has announced that it will revise the terms of that accommodation. Instead of requiring objecting employers to provide the form and notice to insurers or third party administrators of self-insured health plans so that they can jump in to provide free coverage directly to employees, HHS will issue new regulations in short order, the details of which remain to be worked out, but will likely allow nonprofit institutions to write a letter stating their objections, rather than filling out the form (see the WSJ story here). This will leave the government to make sure employees are not left without contraceptives coverage.

I may be oversimplifying things, but I think this extended accommodation really isn’t such a big deal.  It seems to just add the government in as a middleman between the objecting employer and the insurer or third party administrator that was responsible for providing coverage under the original accommodation.  In other words, before, nonprofit religious employers with an objection had to fill out the form and give it directly to their insurers; after the modification, those employers could just let the government know, and presumably the government will notify their insurers.  A bit more bureaucracy, but shouldn’t be too big of a problem – probably just a drop in the bucket of the massive ACA bureaucracy, and potentially unnoticeable by the women seeking free contraceptives.  That is unless the employers claim that even this approach leaves them complicit in violation of their religious beliefs.

Since SCOTUS’s substantial burden test as applied in Hobby Lobby focused on the hefty fines for noncompliance, rather than the extent to which the employers’ religious beliefs were directly v. indirectly burdened, the complicity point is an important one to keep an eye on.  Will religious employers be satisfied with simply adding another link to the causal chain?  Perhaps (and I hope).  Technically, all they would be asked to do is announce to the world that they have a religious objection.  What the government does with that information is beyond their control.  If this works out, the revised accommodation could also be extended to the closely held for-profit corporations with religious objections to contraceptives coverage that SCOTUS determined could not be forced to comply with the mandate, such that their employees too could retain access.

So let’s see what HHS can come up with.  Haters gonna hate, as they say, so I’m sure there will be more litigation on this, but hopefully we’re nearing a solution – and I think a good compromise.  The bigger issue will be dealing with all those other services that must be included as essential benefits or preventive services to which religious employers may object, and to which insurers are likely to object to providing free coverage.  But let’s see if the ACA lives to die another day after Halbig and King.

The ObamaCare Subsidies Rulings–and the D.C. Circuit’s Disappointing Misreading of the ACA

By Abbe R. Gluck

As most readers know by now, two federal appeals courts on Tuesday reached the opposite conclusions about the validity of the critical financial subsidies on the ACA’s federal health insurance exchanges. The Fourth Circuit in Virginia upheld the subsidies—indicating the government had the better argument, but regardless applying the longstanding rule that when a statute is not clear, courts defer to the agency administering the statute (in this case, the IRS). The D.C. Circuit, however, ruled the other way, reading one provision of this massive and complex federal law out of context. That opinion not only misinterprets the statute—with enormous practical consequences—but also does a deep disservice to conservative jurists and lawyers who have spent the last 30 years arguing that text-based interpretation is sophisticated, not literalistic, and serves democracy.

The stakes are enormous: If the D.C. Circuit’s opinion ultimately carries the day, more than $36 billion dollars in financial relief will be denied to the approximately 7 million people expected to be insured with the help of this financial assistance. It also places Republicans in a real dilemma, especially as the election cycle heats up: The result, if the ruling stands, would be massive red-state/blue-state disparity, as millions of middle-class Americans are deprived in red states of access to medical care, because it is mostly the red states whose subsidies are now at issue.

As I wrote yesterday on Balkinzation, the opinion is terribly disappointing from a statutory interpretation perspective. It relies in part on irrelevant legislative history (from the HELP committee, whose bill wasn’t even the basis for these provisions–the Finance committee’s was) and gets it wrong anyway (as I argued here); it bends over backwards to come up with reasons why Congress might have intended this result (which we all know it certainly did not); and it attaches far too much significance to a line in the statute that expressly deems exchanges in the territories to be state exchanges and does not replicate the special deeming language for the federal exchanges. The territories language is boilerplate language used by Congress when talking about territories in statutes even beyond the ACA, and should have been attached no significance here.

For a more detailed legal and political analysis, check out my op-ed on the cases.

Health Insurance & Patient Responsibility, Part I

By Deborah Cho

With the implementation of the Affordable Care Act, many consumers can now (or eventually…) head to HealthCare.gov to compare health insurance plans to find one that fits their needs.  Health insurance plans, however, can be complicated and fraught with exceptions and exclusions that consumers learn of only when it is too late and medical bills have already started to pile up.  Consumers are directed to consult member handbooks to learn their plan’s terms and conditions, but these handbooks are often nearly a hundred pages in length and densely packed with information.

Nonetheless, patients are held responsible for understanding and abiding by the terms of their plans, even if those terms are confusing and hard to fully appreciate.  For example, patients are expected to know what types of medical care require prior authorization from their insurance carriers and that they must obtain approval before receiving that care.  If these steps are not taken in the correct order, payment can be denied and the patient may be left to foot the bill for the services.  Similarly, patients must understand that their policies may fully cover only in-network providers and must additionally know who is in-network and who is not.  Because the member handbook and/or benefits document allegedly provide adequate notice, the patient is out of luck if he is not aware of these conditions.

The outcome is similar even when a medical provider or the provider’s staff does something to indicate that the medical care in question is covered by the patient’s insurance plan.  This can be as simple as suggesting a specific procedure to help with the patient’s condition or even merely referring the patient to a particular specialist.  A patient may accept care on the understandable yet incorrect assumption that an action recommended by his treating physician is automatically covered by his insurance plan. Though providers often verify that costly care will be covered by a patient’s insurance in order to ensure proper compensation, the instances when this does not happen can be financially devastating to patients.

So who should be responsible for knowing the ins and outs of these health insurance policies?

Read More