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Message to Senate Democrats on Obamacare Federal Subsidies: It's Not How You Feel, It's What You Wrote


The Senate blended Obamacare bills and never provided amendments to "fix" missing subsidies for federal exchanges. This was not an unfortunate mishap.

AP Photo

Isn’t this rich? Those brilliant folks who took over one-sixth of the economy with government health care find themselves in court saying, “Yes, we wrote those words, but we just don’t feel that is what we really meant.”

You simply cannot draw a better line between liberals and conservatives than that. Liberals view the world through their feelings; totally subjective and changing with the vagaries of time.

Conservatives couldn’t care less what you feel. They are interested in what you know. In the current legal dispute over premium subsidies in federal exchanges under Obamacare, what you feel is irrelevant.

Photo credit: Shutterstock.com Photo credit: Shutterstock.com 

This we know: Obamacare originated in the Senate. There was a version from the Finance Committee and another version from the Committee on Health, Education, Pensions and Labor.

The chairman of the HELP committee was Sen. Ted Kennedy (D-Mass.). His version was everything the liberals wanted, including subsidies for both state and federal exchanges.

While the HELP bill made the liberals feel good, the Finance Committee bill was drafted to get 60 votes. It did not include subsidies for those in federal exchanges.

Sen. Ben Nelson (D-Neb.) was a very reluctant Democrat vote. He was concerned about a federal “takeover” of health insurance and was antagonistic to a large federal role. His vote was contingent on the states running the program. His vote was also necessary to get the bill on the floor

The final Senate version was a blending of the HELP and Finance Committee bills. It did not include the federal subsidies evincing the fact that the Senate considered them and decided against it.

AP Photo. AP Photo. 

The decision to not allow subsidies in the federal plans was designed to force state leaders to participate. Since their constituents were paying the costs, surely they would not deny them the benefits.

To add additional encouragement to the states, grants were made available to offset much of the cost of building their exchanges.

Finally, the decision was made to punish states that did not participate by reducing the federal portion of their Medicaid costs.

The Senate passed the bill on Christmas Eve. Everyone went home for the holidays and planned to return in the new year to convene a conference committee to reach the final agreement between the Senate and the House.

The vicissitudes of Massachusetts politics changed the schedule.

On Feb 4, 2010 Scott Brown won the special election for the senate seat in Massachusetts that was vacated by the death of Kennedy. Brown promised not to provide the 60th vote for Obamacare. His election effectively ended Senate activity so the House was forced to accept the Senate version without amendment.

A Senate aide delivers a stack of documents bound in red tape described as the federal regulations dealing with "Obamacare." (Photo: AP) A Senate aide delivers a stack of documents bound in red tape described as the federal regulations dealing with "Obamacare." (Photo: AP) 

The House then immediately passed a budget reconciliation bill which included 153-pages of amendments to fix all of the problems they had with the Senate bill. Reconciliation bills do not require 60 votes in the Senate and it was quickly agreed to. If the intention had always been to include subsidies in federal exchanges this is where they would have corrected it. They did not.

President Barack Obama signed the bill on March 23, 2010.

Section 1401 of the bill establishes a new section 36B to the Internal Revenue Code authorizing subsidies for individuals enrolled in state exchanges.

The Congressional Research Service concluded in April of 2010 that subsidies could only be applied to those enrolled in state exchanges.

It quickly became clear that many states were not going to participate so the administration pushed the Internal Revenue Service to promulgate a rule to do what their law failed to do – provide subsidies for all.

AP Photo AP Photo

Kim Strassel of the Wall Street Journal wrote a detailed explanation how the IRS arrived at its position. The working group of career IRS and Treasury employees met to develop regulations around Obamacare subsidies. They agreed that the subsidies were only for those in state exchanges.

Then they received a memo from the IRS chief counsel, a political appointee, instructing them to include federal exchanges. They changed their position, though email exchanges between Treasury employees showed that they did not believe they had the statutory authority to do so.

The General Accountability Office arrived at the same conclusion. The subsidies are available for those who qualify and are enrolled in a state exchange.

Jonathan Gruber of Massachusetts Institute of Technology was paid over $400,000 in fees as one of the prime architects of Obamacare. In January of 2010 Gruber said in a town hall setting that the subsidies were for those in state exchanges.

When that video was discovered he quickly backtracked and said it was a “speak-o.” Much like a type-o. However, another video appeared from a few days earlier in which he said the same thing.

Dozens of court challenges to Obamacare were filed. In the first Supreme Court action, the Roberts decision threw out the Medicaid penalty directed at non-complying states. It did not address the subsidy penalty.

The Supreme Court will ultimately have to sort this out. Being unburdened by any legal training, I can say that the burden of proof lies with those arguing that the words they wrote don’t count. What counts is how they feel about what they really meant.

During his confirmation hearing Chief Justice John Roberts insisted that the Court is a referee not a player. They get to call balls and strikes. They don't get to swing the bat.

Since the language is unambiguous, the Court must not put itself in the position of divining what the Democrats feel they meant and then rewriting it for them. The law must be sent back to Congress so legislators, who actually are empowered to write laws, can rewrite the words more in consonance with their feelings.

John Linder served in Congress for 18 years from Georgia. He and his wife, Lynne, have retired to a farm in Northeast Mississippi.

TheBlaze contributor channel supports an open discourse on a range of views. The opinions expressed in this channel are solely those of each individual author.

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