Latest Attack on Halbig Shows Evidence of Congressional Intent is Murky

The New Republic‘s Brian Beutler doesn’t like the argument being made by law professor Jonathan Adler and health policy wonk Michael Cannon. From the moment a 3-judge-panel of the D.C. Circuit Court ruled in their favor, Beutler has been writing derisively about “Halbig truthers.” Here’s his description of their argument from about two weeks ago:

some right-wing activists have spent the last several months fabricating a rival narrative—a
ludicrous theory of intent, in which leading Democrats meant to
condition the subsidies, but decided to keep the inducement a secret
from reporters, back bench members, governors, budget analysts, and
health care reform advocates. This kind of deceptive argumentation is
perhaps to be expected from activists. What’s become incredibly
frustrating to me about the Halbig brouhaha in the last few
days is watching the conservative health care writers who were in the
same trenches watching the same debate unfold—attempting, from a very skeptical vantage point, to explain the bill correctly—suddenly turn around and vouchsafe the Halbig Truthers.

This is Beutler’s version of the “we would have known” claim, i.e. if there had been something this big and significant in the bill he and his fellow wonks would have reported on it at the time. Nearly everyone on the left who has written about Halbig has made some version of this argument. There are two problems with it.

First, there’s the trust issue with regard to reporting on Obamacare by progressive wonks. As has now been established beyond any doubt, Obamacare contained a feature, the public option, which was intended as a way to move the country toward single-payer over time. Progressive wonks and congressional representatives all knew this at the time, but good luck finding any articles in which they reported on it. There was a vast silence on this issue by the people who knew. So the idea that a significant aspect of the law might be kept quiet isn’t crazy. It happened.

But second, even if you put all of that aside, there is no proof of Beutler’s main contention, i.e someone would have known. As we’ve seen since he wrote that piece, even the people who should have known about this did not have a clear understanding of exactly how the law worked at the time.

There’s another reason to think this might have been overlooked. The so-called HELP bill, one of the two bills coming out of the Senate which were eventually merged to become Obamacare, explicitly cut subsidies from states that didn’t adopt reforms. The language is very clear, “the residents of such State shall not be eligible for credits under section 3111.” So was this reported at the time?

Again, good luck finding a report on this aspect. I’ve gone back and looked through dozens of reports about the HELP bill’s features. Most of them mention exchanges and subsidies. None of them, that I’ve seen, mention that some states might not get subsidies for a period of four years and could lose them thereafter at the discretion of the HHS Secretary. There may still be one or two out there but it certainly was nowhere near the forefront of anyone’s mind at the time.

In his latest piece on the topic, Beutler interviews a former CBO staffer who scored the bill. The basic argument here is a variation on the “we would have known” argument, i.e. if subsidies had been conditional then this staffer would have had conversations about how many states would create an exchange. He didn’t have those conversations, therefore he assumed everyone would get subsidies.

Beutler grants that counter-factuals posed today don’t really tell us what people were thinking 5 years ago. And, to his credit, he adds a nota bene which explains he was actually hoping for something a bit more definitive:

I set about reporting this story hoping to find something more
conclusive. When I requested an interview with White, it was to ask him
about how CBO modeled the administrative and start-up costs of state and
federal exchanges. Since establishing state and federal exchanges
ultimately entailed different costs, I thought CBO might’ve made
specific assumptions about how many states would set up their own
exchanges, and how many would rely on the federal fallback, in its cost
estimates. If CBO both assumed that some states would use the fallback, and that residents of those states would be eligible for tax credits, it would’ve spoken pretty clearly to congressional intent.

As
it turns out, this distinction didn’t require CBO to make any
assumptions at all, because for CBO’s purposes the costs would’ve been
identical regardless.

He looked for a fatal flaw and didn’t find it. To be fair to Beutler, not finding a smoking gun at the CBO doesn’t mean he’s wrong. But it does demonstrate, once again, that congressional intent on this issue is murky. The wonks didn’t know what it was or had it wrong. If the best argument is that the CBO didn’t discuss it and thinks maybe it would have, we’re not exactly dealing in certainties.