Civitas Review

CLF Talks with Chad Adams about Obamacare, Transparency, and More

Jun
26

Yesterday, I sat down with Chad Adams of the Freedom Action Network  to discuss the Supreme Court's ruling on the Affordable Care Act, as well as what the Center for Law and Freedom is and what we are up to. If you missed the interview, you can listen to it in its entirety here.

Anyone with additional questions about the activities of the Center for Law and Freedom can contact us at clf@nccivitas.org.

The Best Lines from Scalia's King v. Burwell Dissent

Jun
25

Every cloud has its silver lining. Despite the U.S. Supreme Court again bending over backwards to uphold the Affordable Care Act, the good news is that we get to read yet another scathing Scalia dissent. In writing that the Court has essentially rewritten the law to accommodate the IRS's desired interpretation, Justice Scalia once again reminded of us how he pulls no punches and takes no prisoners.

His dissent began in typical fashion:

The Court holds that when the Patient Protection and Affordable Care Act says "Exchange established by the State" it means "Exchange established by the State or the Federal Government." That is of course quite absurd, and the Court's 21 pages of explanation make it no less so.

He then commented on the majority's interpretation of the clear words of the Affordable Care Act:

Words no longer have meaning if an Exchange that is not established by a State is "established by the State." It is hard to come up with a clearer way to limit tax credits to state Exchanges than to use the words "established by the State." And it is hard to come up with a reason to include the words "by the State" other than the purpose of limiting credits to state Exchanges.

However, Justice Scalia suggests that normal rules of interpretation do not matter to Chief Justice Roberts:

Under all the usual rules of interpretation, in short, the Government should lose this case. But normal rules of interpretation seem always to yield to the overriding principle of the present Court: The Affordable Care Act must be saved.

And that wasn't the end of it —

Having transformed two major parts of the law [in past decisions], the Court today has turned its attention to a third. The Act that Congress passed makes tax credits available only on an "Exchanges established by the State." This Court, however, concludes that this limitation would prevent the rest of the Act from working as well as hoped. So it rewrites the law to make tax credits available everywhere. We should start calling this law SCOTUScare.

Finally, Scalia noted the damage that today's decision and others like it have done to the reputation of the Supreme Court:

[T]his Court's two decisions on the [ACA] will surely be remembered through the years. The somersaults of statutory interpretation they have performed ("penalty" means tax, "further [Medical] payments to the State" means only incremental Medicaid payments to the State, "establishment by the State" means not established by the State) will be cited by litigants endlessly, to the confusion of honest jurisprudence. And the cases will publish forever the discouraging truth that the Supreme Court of the United States favors some laws over others, and is prepared to do whatever it takes to uphold and assist its favorites. I dissent.

Supreme Court rescues Obamacare…Again

1
Jun
25

The United States Supreme Court has voted 6-3 to uphold healthcare tax credits in the 34 state that opted not to establish state-run exchanges. In a similar fashion to the 2012 decision of National Federation of Independent Businesses v. Sebelius, the Court has bent over backwards to ensure that President Obama's signature healthcare law remains in effect. As in the 2012 case, Chief Justice Roberts again wrote for the majority. Justice Scalia wrote the dissent, joined by Justices Thomas and Alito.

Briefly put, the legal challenge focuses on the fact that the Affordable Care Act (ACA) as written authorizes the IRS only to allow tax subsidies for health insurance purchased through state-based exchanges. The challengers argued that in the 34 states where there are no state-based exchanges, there can be no federal subsidies — essentially crippling the entire ACA.

Chief Justice Roberts, writing for the majority, had to base his opinion on the idea that the phrase "established by the States" in fact means "established by the States or the federal government." He did this because, in his view, any other reading would result in there being "no 'qualified individuals' on Federal Exchanges," and this would be in conflict with the overall purposes of the ACA. Unless, of course, the purpose of the ACA was to allow tax subsidies only to those who obtain insurance through state-based exchanges — i.e. what Congress explicitly said.

Justice Scalia disagreed. Writing for the three dissenting justices, he began by saying:

The Court holds that when the Patient Protection and Affordable Care Act says "Exchange established by the State" it means "Exchange established by the State or the Federal Government." That is of course quite absurd, and the Court's 21 pages of explanation make it no less so."

He went on to say that "Words no longer have meaning" if the Court can essentially rewrite a statute to fill the IRS's desired meaning. He then made a very personal, poignant attack on the politics of the majority:

Under all the usual rules of interpretation, in short, the Government should lose this case. But normal rules of interpretation seem always to yield to the overriding principle of the present Court: The Affordable Care Act must be saved.

Thus the Roberts court continues its legacy of bending over backwards to uphold President Obama's policy agenda — all under the guise of acting as the neutral arbiter that the is required to be under Article III of our nation's Constitution.

Senate Budget Would Eliminate Retiree Health Benefits for Future State Workers

Jun
25

A major provision in the Senate budget plan has received little attention before now. The Char-O has the details:

Future state employees could lose one of the biggest perks of government work: Free health insurance in retirement.

The proposed change appears deep within the Senate’s 500-page budget bill and attracted little notice when the budget was debated last week. Senate leaders say the state must rein in rising costs associated with retiree health coverage.

“North Carolina has a massive $26 billion unfunded liability for retiree medical coverage, and the Senate budget is a prudent way to address the long-term viability of the State Health Plan,” said Shelly Carver, a spokeswoman for Senate leader Phil Berger.

Benefits wouldn’t change for any current state employees, but anyone hired after Jan. 1, 2016, wouldn’t be eligible for health care benefits in retirement. That, Carver says, “would ensure that current state employees are not affected and maintain their coverage throughout their retirement.”

Currently, state retirees can enjoy fully subsidized health care coverage if they’ve worked at least 20 years for the state and meet age requirements. Employees who retire after 10 to 20 years pay half the cost of their coverage.

The state's massive unfunded liability for retiree health benefits is a topic I've been writing about for years.

Indeed, this 2012 article closely examined the State Health Plan, with a focus on the retiree benefits. Some findings from that report include (data was current as of 2012):

  • The total unfunded liability for retiree health benefits was $33 billion – ranked 9th highest nationally on a per capita basis
  • More than half a billion taxpayer dollars ($516 million) were required to finance the health benefits of retirees in the FY 2012-13 budget
  • Few employers in the private sector offer medical benefits to both active workers and retirees, as North Carolina state government does. In 2010, only 28 percent of large private sector firms offered medical benefits to both employees and retirees.
  • Of those large private employers that do offer medical benefits to both active workers and retirees, 40 percent require the retiree to pay the full premium for coverage while another 30 percent have capped the employer’s subsidy at a fixed dollar amount.
  • Roughly 70 percent of states require retirees to contribute more than a nominal premium, which is all NC now asks.
  • Only seven other states offer to pay 90 percent or more of retiree’s health insurance premiums – even after a maximum qualifying number of years of service.
  • North Carolina is one of only ten states that offer retirees a significant health insurance premium subsidy after only 20 years of service

The unfunded liability for state retiree benefits is massive and has been growing rapidly. North Carolina's practice of offering both heavily subsidized health insurance for current workers and fully subsidized coverage to qualified retirees is far more generous than most large private companies and most other state governments.

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