Thursday, June 25, 2015


So the Supreme Court, by 6-3, with Chief Justice Roberts himself writing for the majority, has told us that exchanges "established by the state" really meant "established by the state or the federal government."

We didn't foresee this outcome.  Roberts has doubled down on his amazing 2012 Obamacare decision in which he proclaimed the federal penalty assessed on those who failed to register for Obamacare was a (constitutional) tax, not a(n unconstitutional) fine, even though the federal government had argued the opposite.

In 2012, Roberts also went with a different majority in the same decision to rule that the federal government could not force the states to expand Medicaid by threatening to withhold Medicaid funding unless the states followed federal orders.  Obamacare was, as we earlier wrote, supposed to employ a "carrot and stick" approach to push states into running Obamacare at the state exchange level.  Medicaid subsidies would be withheld from state programs that failed to expand health coverage.  And individual subsidies, the "carrots," would go only to state exchanges, meaning residents of states that didn't sign up would lose out entirely on the subsidies.

Roberts screwed up the 2012 plan by 1) preserving Obamacare, but 2) denying the federal government the power to force states to expand Medicaid.  Most states, no longer concerned about losing Medicaid funding, decided not to bother with Obamacare, and specifically with creating state exchanges.  So by this year, 6.3 million people -- those living in states with no exchanges partly because Roberts in 2012 had taken away the federal power to force Medicaid expansion -- faced losing their subsidies entirely.

Now Roberts has doubled down on his 2012 decision by saving Obamacare once again.  He did so, in part because 1) his saving the program in 2012 led to those 6.3 million people gaining federal subsidies, and 2) his taking away the federal power to cut off Medicaid funding to states that didn't expand Medicaid had led to states not creating their own exchanges, when the original legislation had envisioned the states would, since they would have had to expand Medicaid anyway.

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