Obamacare 'bailouts' for insurance companies

[struggle4progress]

By Glenn Kessler
August 7 at 3:00 AM

... Regarding insurance companies, the president is referring to “cost-sharing reduction” subsidies, known as CSRs among health-care policy experts. This was an element of the Affordable Care Act that helped lower the cost of deductibles and copays for people making less than 250 percent of the federal poverty line.

The law required insurance companies to offer silver-level plans that discounted the out-of-pocket maximum depending on income level of the enrollee. So instead of a health plan paying, say, 70 percent of the cost of covered benefits, someone who was just above the poverty level would get a plan in which 94 percent of the costs are paid.

The CSRs were in addition to the premium tax credits received by people making less than 400 percent of the poverty line. (The tax credits were available for any level of plan.) The intent was to make it easier for low-income people to afford the cost of health insurance.

But there was a problem in the law: Because of an apparent drafting error, the text failed to explicitly say that appropriations for the CSRs would happen automatically. The Obama administration argued that the intent was clear from the legislative record. Officials noted that premium tax credits, created in a section of the law just above the section for CSRs, are automatically authorized. But a federal judge ruled in 2016 that she saw “no error or maladroit drafting” but an explicit distinction that would requires the CSRs to be annually appropriated by Congress. The ruling is on appeal, but this is why Trump can threaten to end the payments ...

https://www.washingtonpost.com/news/fact-checker/wp/2017/08/07/president-trumps-claim-of-obamacare-bailouts-for-insurance-companies/?utm_term=.a99ff1fe62c9

[Igel]

1. That's how it's likely to go at SCOTUS.

The text of the law makes a distinction. The legislative record might or might not be contemporaneous, and is used when the language is ambiguous.

There have been all sorts of things imposed or banned by judges based on the text even if the "legislative record" was clear. Take CO2 emissions. Was there any intent to ban them? No? Did we know CO2 was being emitted? Did we know it was a greenhouse gas? Sure to both. It doesn't cause harm in the same way that NO2 or SO2 or benzene or numerous other gases do. We breathe it all the time and at current environmental concentrations it's not a danger. But the text of the law, not the intent, was taken as sufficient.

Similarly with the penalty under the ACA. It's viewed as a fine. It was called a fine. It's still a penalty. But it was required to overlook the legislative intent and recast it as a tax that could be waived if certain conditions are fulfilled because Congress has no authority to impose a fine like that. Again, text triumphed over intent, which was clear.

Congress screwed up. They rushed. They cobbled the ACA together from a bunch of text written sometimes by aides, sometimes by lobbyists and NGOs, probably sometimes by WH folk. It was big. It was in two pieces. And it was controversial, passing on a straight party-line vote in the Senate, so it wasn't possible to clean up the screw ups. Now (D) say "fix" and (R) say "fix" and at the surface level it sounds like cooperation is possible but in reality they mean completely different things. "We need a larger shot" means one thing to a track and field athlete in training, to an alcoholic in a bar, and to a duck hunter prepping for a weekend trip. Saying that a word's meaning is a word's meaning is silly in the second instance, but no less silly in the first--just a bit less obvious.