July 29, 2014

WaPo’s Sargent Cites ‘Bombshell’ ACA Legislative History Which Really Helps Halbig Plaintiffs

At the Washington Post’s Plum Line blog this afternoon, Greg Sargent argued that the legislative history of Obamacare supports the argument that Congress intended that participants in federal exchanges be entitled to premium subsidies (alternatively referred to in some quarters as “tax credits”), and that the history should doom the Halbig suit, which contends that tax subsidies cannot be disbursed to Obamacare participants who purchased their coverage through the federal exchange.

Unfortunately for Sargent, the history really makes the opposite legal argument, significantly strengthening the Halbig side’s hand. First we’ll look at what Sargent wrote. Then we’ll see how a RedState diarist nuked his argument within two hours.

Here is Sargent earlier today (bolds are mine throughout this post):

ItDoesNotMeanWhatYouThink

Senate documents and interviews undercut ‘bombshell’ lawsuit against Obamacare

But documents from the Senate committees that worked on versions of the bill in 2009 — combined with a close look at the history of the phrase itself, and interviews with staffers directly involved in the drafting of the statutes — strongly undercut the argument that the law did not intend or provide subsidies to those on the federal exchange.

A reconstruction of the process by which that contested phrase got into the law demonstrates two key facts (italics are his; bolds are mine):

1) The first Senate version of the health law to be passed in 2009 — by the Health, Education, Labor and Pensions Committee — explicitly stated that subsides would go to people on the federally-established exchange. A committee memo describing the bill circulated at the time spelled this out with total clarity.

2) The disputed language about the exchanges being “established by the state” appears in the early version of the law that passed the Senate Finance Committee in the fall of 2009. But that version did not even contain a federally-operated exchange, and in fact required the creation of what the Finance Committee described as “state exchanges.” Therefore, there’s no clear logical way the Senate Finance bill could plausibly have been intended to deny subsidies to those on a federally-operated exchange, since no such federally-operated exchange was envisioned under that bill’s structure.

The disputed language ended up in the final bill because the two versions — both of which intended subsidies in all 50 states, albeit by varying structures — were merged.

Sargent then goes through the various versions of the bill coming out of two different Senate Committees, Finance and “HELP” (Health, Education, Labor & Pensions).

The WaPo writer acknowledges that “the resulting (merged) Senate bill … contains repeated examples of the ‘exchange established by the state’ language that is now threatening the law.”

But he claims that really doesn’t matter:

Yvette Fontenot, a lead Finance staffer (said that) “During the merger of the two bills, we layered the HELP Committee language that established a federal fallback on top of the Finance Committee language that included ‘exchange established by the state.’”

Sargent then cites Fontenot and two other current and former Senate staffers as saying all of this proves what “everyone” intended, and wraps it all up in a neat little bow by quoting Larry Levitt, a senior vice president at the Kaiser Family Foundation, who claims:

The merger of these two (different committees’) approaches may have produced a sloppy end result in terms of legislative language, but the paper trail helps to show what was originally intended.”

One can see how Obamacare rooter Sargent might be so convinced that the history and the testimonials he obtained “strongly undercut the argument” of Halbig’s proponents.

However, legal reality differs. It took not much more than an hour for Leon H. Wolf at RedState to blow up Sargent’s “reasoning.” That’s because language which disappears from earlier drafts of legislation, no mattter how allegedly “sloppy” everyone was, is prima facie evidence of intent not to include it in the final version which became law (links are in original):

Greg Sargent Inadvertently Proves the Halbig Plaintiffs’ Case

… The gist of Sargent’s point is that an earlier version of the Obamacare bill had language that explicitly provided for subsidies for beneficiaries on Federal exchanges, even though the final version of the bill did not include such language …

… Unfortunately for Greg Sargent, anyone who is either a lawyer or a reasonable person will tell you that his evidence proves the exact opposite of what he contends. Since Sargent is neither a lawyer nor a reasonable person, he concludes that this proves that Congressional Intent (insofar as it matters) was to provide subsidies for those on federal exchanges; everyone else understands that this proves the exact opposite.

This is not really a close call or a matter of reasonable dispute. Even for people who take legislative history as a thing that ought to be given great weight, the fact that Congress included a clause in an earlier version of the bill but then changed or removed it in the final version is considered to be conclusive evidence that Congress specifically desired the change in question, not that they intended the earlier version. Let’s say hypothetically that you had a bill that said when it came out of committee, “Congress hereby appropriates $10 million for the funding of studies the mating habits of pink salmon and $5 million for the funding of studies of the mating of silver salmon,” but the final version of the bill merely said “$1o million for the funding of studies of the mating habits of pink salmon,” courts (like reasonable people) come to the inescapable conclusion that the clause about the silver salmon was removed per the deliberate intent of Congress otherwise it would have remained in the bill.

Likewise if a bill comes out of committee that says “The Federal Government and the Several States shall have concurrent jurisdiction over the enforcement of this mandate” but the final bill that gets passed says “The Federal Government shall have jurisdiction over the enforcement of this mandate,” that is considered conclusive, case-ending evidence of Congressional intent to remove State jurisdiction over the enforcement of the mandate in question.

Don’t take my word for it. My colleague Dan McLaughlin has compiled a list of Supreme Court precedents repeatedly making this exact point – see here, here, and here for just a few examples.

Make no mistake; Greg Sargent has made a powerful and compelling point about the Halbig decision. The problem for Sargent is that his point is much, much more likely to be cited by the Halbig Plaintiffs on appeal than by the defendants.

This result is so delicious that you have to wonder if Sargent wasn’t punked by a tipster who deliberately misled him while sending current and former Democratic legislative staffers on a golden goose chase — only to deliver a turkey disguised as a goose.

Now let’s see if the establishment press acknowledges the impact of the dropped language — and if they do, whether they swallow Sargent’s hollow line or note the correct legal argument.

Well, then-House Speaker Nancy Pelosi said that they would have to pass it so people could find out what’s in it. Too bad they’re also stuck with what’s not in it.

Cross-posted at Newsbusters.org.

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