Maine Takes Sides in Obamacare Supreme Court Case

February 19, 2015 Posted by Patrick Marvin - No Comments

Maine seems to have taken a side in the U.S. Supreme Court case regarding Obamacare subsidies – but it’s not the side you might expect.

The case, King v. Burwell, will likely be decided this June, and represents perhaps the greatest opportunity (and the most useful bargaining chip) to dismantle or reform President Obama’s signature health care achievement.

Although this case does not question the legality or constitutionality of Obamacare, it nonetheless could strike a serious blow to the program by eliminating subsidies for approximately six million Americans.

The case is based on the fact that Obamacare never intended to rely on a federal exchange – as shown by the clear language in the law – but instead sought to have states create and administer their own health insurance exchanges.

Obamacare, as written and passed by Congress, incentivizes states to create their own exchanges by offering to provide subsidies for those who purchase health insurance through state exchanges. While the law does allow for the creation of a federal exchange as a backup plan, it clearly does not authorize subsidies to flow to individuals who utilize this exchange.

Offering funds as a reward for states creating programs or changing statutes is a common tactic used by the federal government. But while the feds usually withholds funds if a state chooses not to take the preferred course of action, something different happened with Obamacare.

The Obama Administration, recognizing that the majority of states would not shoulder the burden of creating their own exchanges, simply ignored the text of its own law, and authorized subsidies to go to those who signed up through the federal exchange.

In this sense, King v. Burwell is actually a case defending Obamacare, and fighting for the law to be carried out and implemented exactly the way it was written by Congress and signed by the President.

While supporters of Obamacare are crying foul and proclaiming that eliminating federal subsidies would cause a financial nightmare for millions across the country, others are explaining that these scare tactics only tell half the story.

The Supreme Court may well rule against the Obama Administration, but given the enormous impact of this type of a ruling, it is highly unlikely that Americans would be without subsidies for long, if at all. Congress would immediately be under tremendous pressure from not only the President, but more importantly the American people, to act quickly and prevent any financial fallout. There would be an almost instantaneous push to amend Obamacare, permit federal subsidies, and seemingly stop the financial apocalypse. Even the most hardened Obamacare opponents in Congress would feel compelled to act on this issue, if they desired to have any political future.

But it is at this point that King v. Burwell really becomes a bargaining chip.

Obamacare opponents would likely support a bill amending Obamacare, but you can also count on them wanting something from the President in return. With Republicans controlling both chambers of Congress, President Obama will undoubtedly have to sacrifice some portions of his health care law if he wants ensure the program remains financially feasible.

Some have suggested trading a repeal of the individual mandate for the subsidies, while others have floated the idea of eliminating the employer mandate, or returning the full-time work week to 40 hours. Regardless of what type of a tradeoff Republicans in Congress pursue, they will for the first time have a significant advantage over the President in deciding the future of health care in the U.S.

But not everyone would like to see King v. Burwell turn out this way.

Several states, including Maine, have come out in support of the Obama Administration and their handling of federal subsidies.

In a recent “friend of the court” brief filed on behalf of Maine, Attorney General Janet Mills urged the Supreme Court to essentially ignore the plain text of the Obamacare law and preserve the federal subsidies. Using the same, tired scare tactics, Mills asserted that ruling against the Obama Administration would spell disaster for needy Americans and their families.

While there is no word on whether or not Governor LePage is in agreement with Mills, we can reasonably assume the governor does not share her viewpoint. LePage has long been a vocal critic of Obamacare, and has instead supported consumer friendly and economically responsible health care initiatives.

We can only hope that the Supreme Court ignores Mills’ support for Obamacare subsidies, holds the Obama Administration accountable, and allows the U.S. to move towards improving and reforming our health care system.