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In case anyone wasn’t sure about the White House denials regarding its ties to Jonathan Gruber, here we have video of Obama heaping praise upon him:
“You have already drawn some of the brightest minds from academia and policy circles, many of them I have stolen ideas from liberally, people ranging from Robert Gordon to Austan Goolsbee; Jon Gruber; my dear friend, Jim Wallis here, who can inform what are sometimes dry policy debates with a prophetic voice.”
This seems to directly contrast Obama’s statement to Ed Henry yesterday, where he “just learned” about Jonathan Gruber (probably from the TV), like every other major story. President Obama said, “I just heard about this. I get well briefed before I come out here. The fact that some adviser who never worked on our staff expressed an opinion that I’ve completely disagreed with in terms of the voters, is no reflection on the actual process that was run. We had a year-long debate, Ed, I mean, go back and look at your stories. The one thing we can’t say is that we did not have a lengthy debate about health care in the United States of America. or that it was not adequately covered. I think it is fair to say that there was not a provision in the health care laws that was not extensively debated and was fully transparent.”
Gruber was also not merely “some advisor who never worked on our staff”. We know now there was a cozy relationship with Gruber. Gruber “visited the White House more than a dozen times, according to official visitor logs. One of those meetings took place in the Oval Office with Obama. Additionally, according to contracts issued by the Department of Health and Human Services, Gruber was paid $400,000 for his work on the president’s signature health care law.”
Additionally, Gruber was paid large sums of taxpayer money, totaling nearly $4 million of the last several years — half of it directly related to Obamacare work. Though he wasn’t paid directly by the White House (probably how Obama technically justified the “staff” comment to himself), he was paid by Health and Human Services as well as 8 states so far to work on Obamacare and, prior to, by HHS for other consulting work
Though Obama continues to try to distance himself from Gruber and his remarks, the ties just keep surfacing.
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With all the revelations surrounding Jonathan Gruber and the behind-the-scenes Obamacare manoeuvring, Charles Krauthammer weighs in with a solid, sobering analysis. Krauthammer explains, “It’s refreshing that “the most transparent administration in history,” as this administration fancies itself, should finally display candor about its signature act of social change. Inadvertently, of course. But now we know what lay behind Obama’s smooth reassurances — the arrogance of an academic liberalism, so perfectly embodied in the Gruber Confession, that rules in the name of a citizenry it mocks, disdains and deliberately, contemptuously deceives.
The whole piece should be read in its entirety. And you know that Gruber’s remarks have hit a nerve with the White House, as they and the Democrats continue to try to run from their ties to him. Gruber exposed their thought process and tactics.
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With all the discussion swirling with regard to Jonathan Gruber, the stupidity of the American voter, and the funny scoring of Obamacare by the CBO, it’s worth it to note that CBO trickery is still ongoing.
Hats off to The Weekly Standard last month for delving into the question of true Obamacare costs. The Senate Budget Committee (SBC) took the time to analyze the Congressional Budget Office (CBO) projections related to Obamacare and this is what they found:
**”The Congressional Budget Office (CBO) has not actually scored the deficit impact of Obamacare since the summer of 2012″.
Why is this the case? Is it to leave rosier information available to the public so Obamacare backers can continue to peddle positive talking points and obfuscate the financial impact of this legislation?
The most recent CBO scoring was done using the 2013-2022 ten year budget window — and the estimate was that Obamacare would reduce the deficit by $109 billion at that time. So the SBC took the same growth rate used to tabulate that projection and applied it to a new, more relevant 10 year window, 2015-2024.
The SBC found that the surplus would have grown to $180 billion for 2015-2014… ”if nothing had changed in the interim” . And that’s the key. So much has changed in with regard to Obamacare in the last two years that the surplus will now be a deficit — but they don’t want you to know that yet.
What has changed since the summer of 2012? We had the fumbled rollout of the Obamacare exchanges in 2013. We also had Obama declining to enforce the employer and individual mandates on schedule per the law. Both of these significant items affect revenue and costs, and certainly make it clear that the CBO projections on deficit impact from 2012 are no longer meaningful, relevant, or accurate.
Interestingly, the CBO has found the time to make “technical adjustments to its baseline projections for federal health spending, has updated its economic forecasts, and has scored the legislation’s effect on labor markets.” But it just hasn’t gotten around to updating the impact of Obamacare on the deficit. In two years.
How does the CBO go about determining deficit impact? There are three areas that comprise this figure, which, added together, provides the deficit number in its totality. They are:
1) “‘Net changes in the deficit from insurance coverage provisions.’ That’s the spending side of Obamacare (or at least its net spending on insurance coverage provisions).”
2) “‘Net changes in the deficit from other provisions affecting direct spending.’ That’s the money that would have been used to fund Medicare (or, to a lesser extent, other federal health programs) but is now slated to be used to fund Obamacare instead.”
3) “’Net changes in the deficit from other provisions affecting revenues.’ That’s the taxes, fees, and penalties under Obamacare that don’t have much, if any, relation to insurance coverage provisions. (The taxes that do relate to insurance coverage provisions — namely, the tax on “Cadillac plans” and the fines for those who violate the individual or employer mandates — are instead included in the first area.)”
Only the first of those three areas has been updated — the spending side of Obamacare — and that was done in April of 2014. Noting the “lower-than-expected enrollment in the Obamacare exchange, changes in health cost assumptions, and reduced penalties collected from individuals and employers due to the president’s selective enforcement of the law”, the CBO updated its numbers regarding the “net spending on insurance coverage provisions”, from $1.171 trillion in 2012, to $1.383 trillion in 2014.
But what of the revenue side of the deficit numbers? That’s the part that has not been updated since 2012. This includes the revenue from Medicare, as well as “non-coverage-related taxes, fees, or penalties”.
By not updating these important revenue figures, the Senate Budget Committee (SBC) found that the CBO therefore “hasn’t incorporated the technical adjustments it has made to its baseline projections for federal health spending as they pertain to Medicare, its updated economic forecasts, or its scoring of Obamacare’s effects on labor markets”. That’s a huge problem. Essentially, they are still hanging onto pre-Obamacare roll-out projections and assumptions in these areas as it relates to revenue.
The Senate Budget Committee (SBC), therefore, has taking the time to calculate the revenue side of the deficit tally, specifically using the technical adjustments the CBO made to its baseline projections when it updated the federal health spending numbers earlier in 2014. Here’s the results of the analysis:
For the area related to Medicare and other federal health programs, (#2 above), the SBC found that the
“baseline changes reduce the amount of projected federal health care savings from the other provisions affecting direct spending in the legislation by a total of $132 billion over the 10-year period, from $979 billion under the CBO 2012 extrapolation to $847 billion based on the SBC staff calculation.”.
In other words, the expected revenue from Medicare and other federal health programs over the newest 10 year period is estimated to be $132 billion less than what was projected in 2012 before Obamacare started.
In the final area which deals “other provisions related to revenue”, such as taxes, fees, and penalties, the lack of expected revenue is even more substantial. (Interestingly, a recent TIGTA report analyzing the just the medical excise tax in this regard corroborates the finding that they are not meeting Obamacare revenue estimates).
Ultimately, the provisions “related to revenue” all concern the labor market — and not in a good way. As noted above, the CBO did score the affect of the labor market’s effect on Obamacare in order to update its federal health spending numbers. That was done in Feb 2014, and the CBO found that “by 2024 the equivalent of 2.5 million full-time workers will exit the labor force as a result of the law. The CBO estimates the law will reduce the total number of hours worked by 1.5 to 2 percent during the FY 2017–2024 period and will reduce aggregate labor compensation by 1 percent over the same period.”
Therefore, the Senate Budget Committee (SBC) took this updated labor analysis and applied it to the third area, specifically looking at how that reduction in aggregate labor compensation would affect taxable income. The SBC found that “based on these assumptions, Obamacare is now projected to get $262 billion less in (non-coverage-related) revenue because of its detrimental effect on job growth, a notion that wasn’t registered in the CBO’s July 2012 scoring.”
And what was the final tabulation of Obamacare’s impact on the deficit?
“So, compared to the deficit surplus of $180 billion for 2015-24 that a straight extrapolation from the CBO’s 2012 scoring would yield, current projections now indicate that Obamacare’s decreased spending (in relation to prior expectations) will reduce deficits by another $83 billion (bringing the estimated surplus to $263 billion), but those projected surpluses will be more than offset by the projected $132 billion decrease in Medicare revenue and $262 billion decrease in tax revenue due to lower job growth.
In all, therefore, CBO projections indicate that Obamacare will increase deficit spending by $131 billion from 2015-24. That’s a $311 billion swing from the extrapolated 2012 numbers, a $240 billion swing from the actual 2012 numbers, and a $255 billion swing from what we were told when Obamacare was passed.“
That’s a mighty big change in only 2 years. How will Obamacare make up the revenue? Will it be an increase in premiums? We still don’t know. Unlike last year, when Obamacare enrollment began on October 1, this year, Obamacare enrollment was held off until November 15 — 11 days after midterm elections.
As recently as this past Monday, the NYT reported that, the Administration lowered its estimate of enrollees by about 30%, “projecting that “9.1 million people would have such coverage at the end of next year. By contrast, the Congressional Budget Office had estimated that 13 million people would be enrolled next year, with the total rising to 24 million in 2016. In the past, the White House has used the budget office numbers as a benchmark for success under the Affordable Care Act.”
4 million fewer enrollees is a large difference in target numbers. So when will the CBO update its data so that the public can accurately ascertain Obamacare’s impact on the deficit?
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This Washington Times piece did a nice overview of FY2014:
The Treasury Department unveiled its Fiscal Year 2014 numbers, which showed that the government’s revenue, for the first time ever, hit the $3 trillion mark. However, the government still overspent its revenues, leaving a $483 billion deficit.
Supporters of President Obama are touting the “success” of a $483 billion deficit by pointing out its the lowest deficit since 2008. A “mere” $483 billion deficit is not something to be celebrated. It means that, despite record revenues, the government still engages in out-of-control spending.
By comparison:
“The government first hit the $1 trillion revenue mark in 1990, then hit the $2 trillion mark in 2000. But President George W. Bush’s tax cuts and the bursting of the 1990s Internet bubble cut into revenue, dropping it to $1.8 trillion in 2003, before it began the shaky climb to $3 trillion.
Just five years ago, in 2009, the trough of the recession, revenue was only $2.1 trillion. That means it’s leapt $900 billion in just five years.”
And here’s where the dichotomy lies. The Left sees high government revenue as something to be celebrated, while the Right understands that high government revenue means less money for the private sector. “Every one of those $3 trillion is sucked out of the private-sector economy and makes the private sector smaller,” said Chris Edwards, director of tax-policy studies at the Cato Institute. “The $3 trillion isn’t free. It comes out of our pockets and from the private economy.”
Contrast his analysis with Jack Lew’s, Treasury Secretary. “The president’s policies and a strengthening U.S. economy have resulted in a reduction of the U.S. budget deficit of approximately two-thirds — the fastest sustained deficit reduction since World War II,” Mr. Lew said.
What are those “president’s policies”? Successful tax hikes. The highest 2% earners saw their tax margins increase; all earners saw their payroll taxes go up. And don’t forget the Obamacare taxes. The full list of all of Obama’s tax increases can be found here.
Perhaps the most profound statement can be summed up here: “Spending, meanwhile, has remained relatively flat at about $3.5 trillion.”
When spending is “flat” at $3.5 trillion, we definitely have a problem. Each year since 2009, the Obama Administration has spent over $3 trillion, the only president to ever do so: From 2009 – 2013 respectively, here are the numbers of spending in per year: 2009: $3,517,677; 2010: 3,457,079; 2011: $3,603,059; 2012: $3,537,127; 2013: $3,454,605. For a full chart of historical federal spending per year, go here. Federal spending has remained consistent at around $3.5 trillion/year — consistently high. Over-budget. And adding deeply to the deficit each year.
It will be interesting to revisit this next year at the end of FY2015, when Obamacare, the crowning Obama policy achievement, really gets going. Remember how Obamacare was going to reduce deficits? About that. The Weekly Standard recently did a thorough analysis of Obamacare projections and found that:
“So, compared to the deficit surplus of $180 billion for 2015-24 that a straight extrapolation from the CBO’s 2012 scoring would yield, current projections now indicate that Obamacare’s decreased spending (in relation to prior expectations) will reduce deficits by another $83 billion (bringing the estimated surplus to $263 billion), but those projected surpluses will be more than offset by the projected $132 billion decrease in Medicare revenue and $262 billion decrease in tax revenue due to lower job growth.
In all, therefore, CBO projections indicate that Obamacare will increase deficit spending by $131 billion from 2015-24. That’s a $311 billion swing from the extrapolated 2012 numbers, a $240 billion swing from the actual 2012 numbers, and a $255 billion swing from what we were told when Obamacare was passed.
So, this fiscal year was more of the same. Government overspending, gleefully celebrated by record tax collections of your hard earned dollars. The rapacious government needs to be fed.
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Thanks to the folks over at CATO, we have a video of the current IRS Commissioner John Koskinen, speaking before the Ways and Means Health Subcommittee early this week. He was being questioned about taxes and Obamacare, and asked about subsidies being repaid.
Chairman Brady said, “The law in that case is that there is not a cap. Subsidies must be repaid. Will you be following the law in that recapture?”
Koskinen replied, “Yes, wherever we can, we follow the law.”
In other words, following the law is a “can”, not a “must”.
With regard to Koskinen’s remarks, Forbes had an interesting observation:
“Numerous Treasury and IRS staffers have told investigators from the House Committee on Oversight and Government Reform that they knew back in 2011 that the Patient Protection and Affordable Care Act didn’t authorize them to issue health-insurance subsidies through Exchanges established by the federal government. But they did so anyway. (And now they’re in court.) The Wall Street Journal‘s Kim Strassel writes about it here.
Given that context, Koskinen’s remark seems like an admission that the IRS sees the law more as a set of guidelines”.
Indeed. I wonder if anyone was to get audited by the IRS, that they could use the phrase “Wherever we can, we follow the law” successfully in their defense.
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According to the Treasury Inspector General for Tax Admininstration (TIGTA), the 2.3% medical device excise tax enacted to help pay for Obamacare is not meeting targets.
The tax went into affect January 1, 2013. The TIGTA report analyzed the returns for the first two quarters (6 months) of 2013, and found that the “excise tax revenue being reported are lower than estimated” for a total of $913.4 million. The IRS expected to have received “excise tax revenue of $1.2 billion for this same period.”
The report also states that the “Joint Committee on Taxation estimated revenues from the medical device excise tax of $20 billion for Fiscal Years 2013 through 2019.”. And yet, in the first six months alone, the estimate amounts are off by 25%. That does not bode well.
Many of the problems originate in the IRS. In fact, the report is aptly named “An Improved Strategy Is Needed to Ensure Accurate Reporting and Payment of the Medical Device Excise Tax”. Some of the key findings:
“The IRS is attempting to develop a compliance strategy to ensure that businesses are compliant with medical device excise tax filing and payment requirements and has taken several measures to advise medical device manufacturers of the new excise tax. However, the IRS cannot identify the population of medical device manufacturers registered with the Food and Drug Administration that are required to file a Form 720 and pay the excise tax.”
“In addition, processing controls do not ensure the accuracy of medical device excise tax figures reported on paper-filed Forms 720. Our analysis of 5,107 Forms 720 processed for the quarters ending March 31 and June 30, 2013, identified discrepancies in the amount of the medical device excise tax and/or taxable sales amount captured from 276 paper‑filed tax returns. TIGTA identified medical device excise tax discrepancies totaling almost $117.8 million when comparing the excise tax amount captured by the IRS from the Form 720 to the excise tax amount TIGTA calculated.”
And the most interesting:
“Finally, the IRS erroneously assessed 219 failure to deposit penalties totaling $706,753 against businesses filing a Form 720 for the quarters ending March 31 and June 30, 2013, which was designated a penalty relief period. The IRS had reversed 133 of the 219 penalty assessments. When TIGTA alerted the IRS of the remaining 86 penalties, IRS management reversed the penalties and issued apology letters to the affected taxpayers.”
The IRS, it seems, was unprepared to handle the collection of excise tax, and furthermore, did not seems to understand basic reporting and penalty relief periods of which it was put in charge.
Think about this: we are now in August of 2014. That means that the second half of 2013 and the first half of 2014 went by before the TIGTA report was released with its findings. If the first 6 months of revenue were found to be about 25% under estimate, it is likely the trend continued for the next full year.
The IRS did agree to the findings of the TIGTA report. However, the summary does not leave one feeling confident that there will be swift resolution now that the problems have been discovered and dissected. Note the ambiguity and qualifiers:
The IRS agreed with our recommendations and plans to consider alternative strategies for identifying noncompliant manufacturers, identify programming changes needed to improve the math verification for paper-filed Forms 720, and implement procedures for corresponding with taxpayers if the changes can be accomplished within budgetary constraints.
Never mind the fact that the Affordable Care Act passed in March 2010 with the excise tax being a key, but controversial, revenue-raiser. The IRS had nearly three years to come up with a) a system to identify companies who owed the tax and b) a system to process the associated forms. And it couldn’t do it.
With the tax being so controversial from the get-go, there have been measures in Congress calling for its repeal because of its impact on the cost of devices and well as jobs in the medical device field.
“The medical device industry has been lobbying hard to get the tax repealed, and there has been movement in Congress. Both the House and the Senate have passed separate pieces of legislation calling for the tax to be repealed, though the Senate vote was on a nonbinding resolution.”
The problem at this point with excise tax repeal is the question of how to make up for even more lost revenue to pay for Obamacare. Taxpayers should be indeed be nervous that the tax collection is showing to be only 75% and we actually have no idea if it improved or worsened at all over the following year because data is not available for it.
The only thing we do know is that we are certain to see a premium rate increases this coming year because the projections have been so off-estimate.
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Reason does a good job (un)covering some clips from 2012, which feature the Chief Architect for Obamacare, Jonathan Gruber. They come at an awkward time just as a Circuit Court judge panel ruled that Obamacare was limited to only providing subsidies in state exchanges, not federal, per the text of the law. The government unsuccessfully argued that everyone meant both federal and state exchanges, and the text was akin to a typo.
Back to the clips and the article. Apparently, in 2012, Jonathan Gruber described precisely the opposite of the government’s recent argument — that Obamacare was limited to state run exchanges and the threat was that, if states did not set up exchanges, the residents of those states would lose out on millions and billions in tax subsidies. Oops.
After being presented with the video, Gruber denied that position and suggested the bill really just contained a typo. And then, a second video was found, also from 2012, which Gruber again argues the same point — that Obamacare only meant to have state-run exchanges. Remember, Gruber was the “chief architect of Obamacare”. Oops again.
The government did not anticipate that a majority of governors would reject the carrot of tax subsidies dangled in front of them when presented implementing Obamacare in their states. They simply did not comprehend that most states would find Obamacare too expensive or too bureaucratic. That is why the bill never said “federal exchanges”. The allure of tons of tax subsides was supposed to woo all the governors to be enticed by this poorly-crafted-bill-that-was-rammed-through-Congress.
When the embarrassment emerged that only a handful of states chose to participate, they scrambled to create federal exchanges, even though that was never intended in the first place. Now the courts have to fight it out. Now we have courts who are split between the language and the spirit of the law.
That is why this unearthing of video footage of the handpicked Obamacare crafter is particularly awkward for the government’s defense.
From the Reason article: (also worthwhile to go there and check out the videos)
“Obamacare’s defenders have responded by saying that this is obviously ridiculous. It doesn’t make any sense in the larger context of the law, and what’s more, no one who supported the law or voted for it ever talked about this. It’s a theory concocted entirely by the law’s opponents, the health law’s backers argue, and never once mentioned by people who crafted or backed the law.
It’s not. One of the law’s architects—at the same time that he was a paid consultant to states deciding whether or not to build their own exchanges—was espousing exactly this interpretation as far back in early 2012, and long before the Halbig suit—the one that was decided this week against the administration—was filed. (A related suit, Pruitt v. Sebelius, had been filed earlier, but did not challenge tax credits within the federal exchanges until an amended version which was filed in late 2012.) It was also several months before the first publication of the paper by Case Western Law Professor Jonathan Adler and Cato Institute Health Policy Director Michael Cannon which detailed the case against the IRS rule.
Jonathan Gruber, a Massachusetts Institute of Technology economist who helped design the Massachusetts health law that was the model for Obamacare, was a key influence on the creation of the federal health law. He was widely quoted in the media. During the crafting of the law, the Obama administration brought him on for consultation because of his expertise. He was paid almost $400,000 to consult with the administration on the law. And he has claimed to have written part of the legislation, the section dealing with small business tax credits.
After the law passed, in 2011 and throughout 2012, multiple states sought his expertise to help them understand their options regarding the choice to set up their own exchanges. During that period of time, in January of 2012, Gruber told an audience at Noblis, a technical management support organization, that tax credits—the subsidies available for health insurance—were only available in states that set up their own exchanges.
A video of the presentation, posted on YouTube, was unearthed tonight by Ryan Radia at the Competitive Enterprise Institute, a libertarian think tank which has participated in the legal challenge to the IRS rule allowing subsidies in federal exchanges. Here’s what Gruber says.
What’s important to remember politically about this is if you’re a state and you don’t set up an exchange, that means your citizens don’t get their tax credits—but your citizens still pay the taxes that support this bill. So you’re essentially saying [to] your citizens you’re going to pay all the taxes to help all the other states in the country. I hope that that’s a blatant enough political reality that states will get their act together and realize there are billions of dollars at stake here in setting up these exchanges. But, you know, once again the politics can get ugly around this. [emphasis added]
There can be no doubt, based on his record, that Gruber is a supporter of the law. He says so in the presentation. “I’m biased, I’m in favor of this type of law, I won’t hide that,” he says. He also explains early on that his entire presentation is made of “verifiable objective facts.”
And what he says is exactly what challengers to the administration’s implementation of the law have been arguing—that if a state chooses not to establish its own exchange, then residents of those states will not be able to access Obamacare’s health insurance tax credits. He says this in response to a question asking whether the federal government will step in if a state chooses not to build its own exchange. Gruber describes the possibility that states won’t enact their own exchanges as one of the potential “threats” to the law. He says this with confidence and certainty, and at no other point in the presentation does he contradict the statement in question.
In early 2013, Gruber told the liberal magazine Mother Jones that the theory advanced by the challengers in this case was “nutty.” Gruber also signed an amicus brief in defense of the administration and the IRS rule. But judging by the video it is quite clear that in 2012 he accepted the essence of the interpretation advanced by the challengers.
Unless this video is a fraud or there are relevant details missing, there are only two options here: Either Gruber, a key influence on the legislation who wrote part of the law and who consulted with multiple states on setting up their own exchanges, was correct, and the law explicitly limits subsidies to state-run exchanges.
Or he was wrong in a way that perfectly aligns with both the clear text of the legislation and the argument later made by the challengers to the IRS rule allowing susbidies in federal exchanges.
Update: Earlier this week, Gruber was on MNSBC to address the Halbig ruling. He was asked if the language limiting subsidies to state-run exchanges was a typo. His response: “It is unambiguous this is a typo. Literally every single person involved in the crafting of this law has said that it’s a typo, that they had no intention of excluding the federal states.”
Update 2: The Cato Institute’s Michael Cannon, who was instrumental in developing the arguments that laid the groundwork for the legal challenge in Halbig, responds to the video at Forbes:
I don’t mean to overstate the importance of this revelation. Gruber acknowledging this feature of the law is not direct evidence of congressional intent. But Gruber is probably the most influential private citizen/government contractor involved in that legislative process. He was in the room with the people who crafted this bill.
Update 3: Gruber says the statement in the video was “a mistake.” Jonathan Cohn of The New Republic got a response from Gruber this morning. Here are a few snippets:
I honestly don’t remember why I said that. I was speaking off-the-cuff. It was just a mistake. People make mistakes. Congress made a mistake drafting the law and I made a mistake talking about it.
During this era, at this time, the federal government was trying to encourage as many states as possible to set up their exchanges. …
At this time, there was also substantial uncertainty about whether the federal backstop would be ready on time for 2014. I might have been thinking that if the federal backstop wasn’t ready by 2014, and states hadn’t set up their own exchange, there was a risk that citizens couldn’t get the tax credits right away. …
But there was never any intention to literally withhold money, to withhold tax credits, from the states that didn’t take that step. That’s clear in the intent of the law and if you talk to anybody who worked on the law. My subsequent statement was just a speak-o—you know, like a typo.
Update 4: Gruber appears to have made a second “speak-o.” In a separate speech, he spoke of the “threat” posed by states declining to build their own exchanges. And he once again explicitly ties the creation of state-based exchanges to the law’s tax credits (its subsidies for private health insurance insurance).
On January 10, 2012, in a speech at the Jewish Community Center of San Francisco, Gruber said that “by not setting up an exchange, the politicians of a state are costing state residents hundreds and millions and billions of dollars….That is really the ultimate threat, is, will people understand that, gee, if your governor doesn’t set up an exchange, you’re losing hundreds of millions of dollars of tax credits to be delivered to your citizens.”
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A federal appeals panel handed down a ruling this morning that could be problematic for Obamacare. As just reported, “A judicial panel in a 2-1 ruling said such subsidies can be granted only to those people who bought insurance in an Obamacare exchange run by an individual state or the District of Columbia — not on the federally run exchange HealthCare.gov.” You can read the entire appeal here.
This is the eagerly awaited Halbig case. The crux of the case lies in the wording of the actual bill of Obamacare, which specifically lists state exchanges as a source of subsidies.
There is no mention of federal exchanges in Obamacare. This was created merely by an IRS rule authorizing the subsidies in federal exchanges. If upheld, it could affect millions of Obamacare enrollees. The article notes,
“the ruling could lead many, if not most of those subsidized customers to abandon their health plans sold on HealthCare.gov because they no longer would find them affordable without the often-lucrative tax credits. And if that coverage then is not affordable for them as defined by the Obamacare law, those people will no longer be bound by the law’s mandate to have health insurance by this year or pay a fine next year.
If there were to be a large exodus of subsidized customers from the HealthCare.gov plans, it would in turn likely lead to much higher premium rates for non-subsidized people who would remain in those plans, who are apt as a group to be in worse health than all original enrollees.”
The government will most certainly file a full review in U.S. Court of Appeals for the District of Columbia Circuit.
Regardless of the eventual outcome of the case here’s the salient point to take away.
When you look at the plain wording of the actual bill, it really doesn’t make any sense (e.g. common sense). Here we have a perfect example of the Democrats trying — and ultimately succeeding — to push something through without looking at it or even carefully thinking through the implications of the words and provisions. That is not a “glitch”. That is disdain.
Obamacare was drafted badly, and they couldn’t even get it corrected the proper way because of the crookedness by which it was passed. Now we have a stupid mistake that the judiciary is being asked to fix. And that’s the problem.
What the government is asking the courts to do is to ignore the literal wording of the law. On the other hand, if the literal wording is indeed upheld, the immediate effect of a reversal is going to be extremely terrible.
Think about it: the IRS will have to go after people for refunds of tax credits. That will be a messy and slow and heated endeavor. Many people, especially poor people, are going to argue that they wouldn’t have used Obamacare insurance if it wasn’t for the subsidies. From a tactical perspective, such a scenario is not necessarily good for conservative or libertarians either, because it sets up the sound-byte narratives that conservatives and libertarians are “taking away your health care”, “they hate the poor, etc”, which will most certainly be used ad nauseam by the Democrats. Is it worth it?
My heart of hearts wants literal side to win, but at the same time, I’m not entirely convinced that its the best thing in the long run. Yet, if the government wins, it reinforces the precedent we’ve been seeing that it is okay to ignore the actual wording of the law passed by Congress. That most certainly is not okay.
This case perfectly highlights the stupidity and utter contempt for which the Democrats have of procedure and law, as seen in the problems with the entire Obamacare bill.
UPDATE: Allahpundit reminds us that the 4th Circuit upheld the Obamacare subsidies for federal exchange consumers.
So…which is it? Is it the intent of the law or the text of the law? Stay tuned on this one.
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The next big case related to Obamacare, Halbig v. Burwell, is sitting in the U.S. Court of Appeals for the D.C. Circuit. The verdict should be announced soon. The crux of the case lies in the wording of the actual bill of Obamacare, which specifically lists state exchanges as a source of subsidies.
There is no mention of federal exchanges in Obamacare. This was created merely by an IRS rule authorizing the subsidies in federal exchanges.
Regardless of the outcome of the case (for a primer, click here), here’s the salient point to take away.
When you look at the plain wording of the actual bill, it really doesn’t make any sense (common sense). Here we have a perfect example of the Democrats trying — and ultimately succeeding — to push something through without looking at it or even carefully thinking through the implications of the words and provisions.
Obamacare was drafted badly, and they couldn’t even get it corrected the proper way because of the crookedness by which it was passed. Now we have a stupid mistake that the judiciary is being asked to fix. And that’s the problem.
What the government is asking the courts to do is to ignore the literal wording of the law. On the other hand, if the literal wording is indeed upheld, the immediate effect of a reversal is going to be extremely terrible.
Think about it. The IRS will have to go after people for refunds of tax credits. That will be a messy and slow and heated endeavor. Many people, especially poor people, are going to argue that they wouldn’t have used Obamacare insurance if it wasn’t for the subsidies. Not sure if that scenario is ultimately good for conservative or libertarians either, because it certainly sets up the sound-byte narratives that conservatives and libertarians want to “take away your health care”, “they hate the poor, etc”. Is it worth it?
My heart of hearts wants literal side to win, but at the same time, I’m not entirely convinced that its the best thing in the long run. Yet, if the government wins, it reinforces the precedent we’ve been seeing that it is okay to ignore the actual wording of the law, much in the same fashion that the wording of the Constitution is being ignored in some instances.
This case perfectly highlights the stupidity and utter disdain for which the Democrats have of procedure and law.
by | ARTICLES, GOVERNMENT, OBAMA, OBAMACARE
Did a failed medical scheduling project at the VA contribute to the development of “secret waiting lists”?
At least one attempt to implement a scheduling system at the VA never got off the ground after nearly a decade of trying.
Apparently a medical scheduling project for the VA was begun in 2000 and was discontinued in 2009, 9 years after it the project began — and it remained utterly unfinished. Nothing seems to have been done for another 3 years until 2012, when the Secretary of Veteran’s Affairs launched a contest to create an app for scheduling — a contest which didn’t close until the summer of 2013. Was it during this interim time between scheduling systems that the practice of “secret lists” began as a coverup/bandaid for the problem?
According to a press release in 2013 announcing the winners in the “scheduling app” contest, it was noted that the “VA started to develop a Medical Scheduling Package replacement in 2000. This effort was not successful. When VA ended the project in 2009, none of the planned capabilities were delivered. It had cost more than $127 million”.
So, was used at the VA between the end of the Medical Scheduling Package project in 2009 and the Medical Scheduling App Contest of 2012/2013?
We now know there were secret waiting lists as some of the facilities. It also appears the the Obama Administration knew about the “secret waiting lists” as early as 2010. The Daily Caller reports that there was an internal VA investigation in 2010 regarding “paper” waiting lists:
“We conducted this review to determine the validity of an allegation that senior officials in Veterans Integrated Service Network 20 (VISN) instructed employees at the Portland VA Medical Center to use unauthorized wait lists to hide access and scheduling problems,” according to an August 17, 2010 VA Office of Inspector General (OIG) report entitled “Review of Alleged Use of Unauthorized Wait Lists at the Portland VA Medical Center”
Underfunding the Department of Veterans Affairs is not the problem. From 2007 to 2012, enrollment in VA services has increased by 13% from 2007 to 2012. At the same time, the VA budget went from $82 million to $125 million — a 53% increase, and the biggest jump in the VA’s budget history since records go back to 1940. The failed Medical Scheduling Package project alone cost $127 million dollars.
$127 million is a lot of taxpayer monies that could have been used on veterans’ treatments. Yet even with a generous budget, the VA could not deliver quality services to our Veterans.
