The Future for Halbig

    08/29/14

    By Hadley Heath Manning

    An appellate court victory this summer significantly raised the profile of Halbig v. Burwell, one of several cases challenging the authority of the IRS to disburse subsidies through the federal exchange. This case has the potential to impact ObamaCare significantly. 

    So where is this case going?  After the law's challengers won in the U.S. Court of Appeals in Washington, D.C., the government (in this instance, the losers) reacted just as expected: they filed for an en banc hearing, or a re-deciding of the case by more judges at the same (appellate) level. They hope to reverse the decision and align the ruling with a similar one at the Fourth Circuit Court of Appeals (King v. Burwell). 

    In the Wall Street Journal, attorney Adam White explains why an en banc hearing is not necessary or appropriate in this case:

    But if the D.C. Circuit rehears the case en banc, it would be a sharp break from history. The D.C. Circuit rehears virtually none of its cases. Each year the court's three-judge panels make roughly 500 rulings, but the court averages roughly one en banc rehearing. This year has produced a bumper crop: two. The previous year: zero.

    The low numbers are thanks to the court's high standard, found in the Federal Rules of Appellate Procedure: En banc rehearing "is not favored and ordinarily will not be ordered" unless the case satisfies one of two standards. First, an en banc rehearing may be needed to "secure or maintain uniformity of the court's decisions." A three-judge panel is not allowed to overrule old precedents, even when precedents are in conflict; only the full court can do so, en banc.

    Second, en banc rehearing is appropriate for what the federal appellate rules call cases of "exceptional importance." For the D.C. Circuit, this standard has been met almost exclusively by cases raising serious constitutional issues. Over the past decade seven of the nine cases reheard en banc raised difficult questions of constitutional law, such as the rights of Guantanamo detainees or of terminally ill patients.

    Cases that will substantially affect the court's own workings also can be deemed of "exceptional importance." In 2011, the court sat en banc to decide whether taxpayers could file lawsuits challenging IRS procedures for obtaining tax refunds.

    Halbig checks none of these boxes. It is a straightforward statutory interpretation case. The administration's supporters seem to believe that Halbig has "exceptional importance" because the Affordable Care Act is exceptionally important to them and the panel's decision was, in their eyes, wrong. But that is a dangerous interpretation of the standard, for reasons best stated by Judge Harry Edwards —the very D.C. Circuit judge who dissented from the panel decision in Halbig.

    The entire piece is online here

    Instead of an en banc hearing, the law's challengers would like to see the Supreme Court take up the issue. If the Court did so, it would hear the case(s) in spring of 2015 and decide in summer 2015. But a lot can happen before then: Open enrollment for ObamaCare plans for 2015 coverage starts on November 15, 2014, just after the 2014 midterm elections. 

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    Challengers in King Case File Cert Petition

    07/31/14

    By Hadley Heath Manning

    Today, petitioners in the case King v. Burwell filed for certiorari with the Supreme Court.  

    Not ten days ago, David King, Douglas Hurst, Brenda Levy and Rose Luck found out that the Fourth Circuit Court of Appeals sided against them 2-1, and ruled that the Obama Administration did not overstep its authority when it made federal subsidies available through the federal ObamaCare exchange. 

    This case is among a handful that all allege the same thing: The Affordable Care Act or ObamaCare was written to provide federal subsidies to exchanges established by states.  But 36 states chose not to establish exchanges of their own, and thereby default to a federally-operated exchange. The challengers in the King case (and other similar cases) argue that the letter of the law does not provide for subsidies to be disbursed in non-establishing states. They believe the executive branch - through an IRS regulatory rule - overstepped its bounds by changing this part of the law's structure after the fact. 

    Just as the appellants in King found out they'd lost at the appellate level, challengers in an another lawsuit, Halbig v. Burwell, found out that they had won. Halbig's 2-1 ruling went exactly the opposite way at the Court of Appeals for the D.C. Circuit. Court watchers expect the government to ask for an en banc hearing in Halbig, but petitioners in the King case have asked for the Highest Court to take up their case this term.

    From their petition:

    This is a challenge to the most consequential regulation promulgated under the Patient Protection and Affordable Care Act (“ACA”). Two Courts of Appeals have squarely divided over its facial validity. The resulting uncertainty over this major plank of ACA implementation means that millions of people have no idea if they may rely on the IRS’s promise to subsidize their health coverage, or if that money will be clawed back. Employers in 36 states have no idea if they will be penalized under the ACA’s employer mandate, or are effectively exempt from it. Insurers have no idea if their customers will pay for health coverage in which they enrolled, or if large numbers will default. And the Treasury has no idea if billions of dollars being spent each month were authorized by Congress, or if these expenditures are illegal. Only this Court can definitively resolve the matter; it is imperative that the Court do so as soon as possible.

    As I wrote for Doublethink Magazine this week, these cases are already creating bad press for the Obama Administration, and undermine the concept of government-run health care. 

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    House Votes 225-201 to Sue President Obama

    07/30/14

    By Hadley Heath Manning

    Today the House of Representatives voted to proceed with a lawsuit challenging the President's executive overreach, specifically his executive action to delay the implementation of the employer mandate in the Affordable Care Act or ObamaCare.

    Here is House Majority Whip Kevin McCarthy's statement on today's vote:

    "Today, we face a real and increasing threat to our liberty. Time and again, the President has exceeded his Constitutional authority by unilaterally rewriting, ignoring, or suspending the laws duly enacted by Congress and, in many cases, signed by this President himself.

    “The time-tested wisdom of our Constitutional architecture is being corrupted by the consolidation of all three forms of government authority— executive, judicial, and legislative— in one place.

    “This is not about politics; this is about restoring the checks and balances of our Constitution. Today’s vote signaled that we in Congress will act to assert our core constitutional responsibility to write and amend the laws. In so doing, we hope to reestablish that balance between and among the three branches that has been ignored by the President these past five and a half years.”

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    King Case Goes the Other Way on Federal Exchange Subsidies

    07/22/14

    By Hadley Heath Manning

    A split circuit, all in one day!

    Today, while the Court of Appeals in D.C. ruled against the government, the Fourth Circuit Court of Appeals ruled in favor of the government on the same issue.

    The ruling in D.C. was in Halbig v. Burwell, and the ruling in the Fourth Circuit was in King. v. Burwell. These two cases have similar arguments. Here is the ruling in King V. Burwell.

    Read more about the challenges to the IRS rule here

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    Halbig Victory at Appeals Court

    07/22/14

    By Hadley Heath Manning

    Today the federal U.S. Court of Appeals in D.C. ruled against the government in Halbig v. Burwell. The three-judge panel sided with the law's challengers, who argued that the IRS does not have the authority to extend ObamaCare's subsidies to states that did not establish an ObamaCare exchange. In other words, the Court ruled to uphold ObamaCare as written. The text of the law specifies that only state-established exchanges (as opposed to federally-established exchanges) can disburse subsidies and tax-credits to certain middle- and low-income customers.

    Perhaps even more significant, this case could ultimately disrupt not only ObamaCare's subsidies, but the enforcement of the law's individual mandate and employer mandate. This case has the potential to undo major portions of ObamaCare in 36 states - the states that did not opt to establish their own ObamaCare exchange. Needless to say, this case poses a serious threat to ObamaCare.

    Halbig has been widely debated from the beginning, with supporters such as The Cato's Institute's Michael Cannon and Case Western professor Jonathan Adler and many naysayers including Washington and Lee's Timothy Jost.

    In today's ruling, federal Judges Thomas B. Griffith and A. Raymond Randolph ruled with the plaintiffs, and Judge Harry T. Edwards dissented. The next step will almost undoubtedly be an appeal from the government to the full circuit, meaning other judges who sit in the federal Court of Appeals in D.C.  would cast a vote in the case. From there, the case would head to the Supreme Court. Today's ruling at the appellate level is a huge blow to ObamaCare. 

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