Many winners if court rules against Obamacare


In less than two weeks, the Supreme Court will hear arguments in King v. Burwell, the most important challenge to Obamacare since the court upheld the constitutionality of the individual mandate in 2012.

No matter how the Court rules, it will not “strike down” the Affordable Care Act. The case concerns one provision of the law, subsidies provided through the exchanges and whether those subsidies can be offered through federally run exchanges as well as through exchanges “established by a state.”

Because Obamacare outlawed many affordable policies and drove up premiums generally, its operation is extremely dependent on shifting much of that cost to taxpayers through subsidies.

Therefore, if some of those subsidies are ruled illegal, there will be Americans who will have difficulty paying their premiums.

What about those who genuinely cannot afford insurance without the subsidies? Congress almost certainly will step in and find a way to preserve their coverage.

More worrisome would be the possibility that those who received subsidies that they shouldn’t have might have to repay them.

However, historically, the IRS has been lenient about demanding repayment from those who, in good faith, relied on IRS advice that later turned out to be incorrect.

This case is not about who gets one more federal welfare payment. It’s not even about the technical interpretation of statutory language.

Rather, the question before the court is whether a president has the power to unilaterally rewrite a law, simply because he doesn’t like the way it actually passed Congress. The Obama administration is, in effect, asserting that it can spend money that was not appropriated by Congress.

And in this case, because the employer-mandate penalties are triggered by subsidy eligibility, the administration is claiming the power to impose taxes without congressional approval.

Of course every court case has winners and losers. The losers in this case will be those Americans who might have to pay for the full honest cost of their insurance — though, as I say, Congress can step in to help those most in need.

The winners will include taxpayers, who will no longer have to bear as much of the cost of Obamacare’s subsidies. Businesses, especially small businesses, also will be winners, since they might be able to escape the employer mandate. That means workers will be winners too, since employers will find it easier to hire and offer higher wages.

And, if a court ruling finally forces Obama to the bargaining table, we could all be winners with a new health care law that undoes the damage Obamacare is doing to our health care system.

Michael Tanner is a senior fellow at the Cato Institute. Send comments to [email protected].

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