Wednesday, March 11, 2015

King v. Burwell Post-Mortem, Cont'd

by Michael Dorf

In my latest Verdict column I explain the pros and cons of the three main ways in which the SCOTUS could rule for the government in King v. Burwell, even if the Court finds that the relevant statutory language is unclear. As I noted in my last post on the case, one possibility is that the Court could give Chevron deference to the IRS, and a second is that the Court could invoke the clear statement rule of South Dakota v. Dole applicable to conditional spending. The column expands on these and also considers the idea--suggested in amicus briefs and picked up at oral argument--that the principle of constitutional avoidance could be invoked to prevent the necessity of addressing the question of whether it would be unconstitutional for Congress to use the threat of disastrous conditional preemption to coerce states into passing laws that Congress could not simply mandate, given the anti-commandeering doctrine.

To my mind, this third possibility points to a very powerful argument. At the risk of tooting my own horn, it seems to me to be a variant of an argument I laid out in a different context: In an article in the 2007 Columbia Law Review, I raised the possibility of Congress passing a law of dubious constitutionality coupled with a punitive "fallback" provision to be activated in the event that a court found the law unconstitutional. My example there was "a fallback law eliminating funding for parachutes for members of the Air Force in the event that a court struck down the exclusion of homosexual service members from the military" then in force. Although my article acknowledged that fallback laws are generally permissible, I said that a punitive fallback law would not be, because it would be an attempt by Congress to coerce courts into taking measures that Congress has no legitimate power to require them to take.

Likewise here, as I explain in the column in elaborating a point made in one of the excellent amicus briefs in King, although conditional preemption is generally permissible, Congress may not enact a law that punishes the states (rather than failing to reward them or taking over regulating on their behalf) in the event that the states do not do what Congress has no legitimate power to require of them. Thus, while much of the post-oral-argument discussion in the blawgosphere has centered on whether the plaintiffs' reading of 26 § 36B(c)(2)(A)(i) would make it more coercive than, less coercive than, or equally as coercive as the Medicaid expansion conditions invalidated in NFIB v. Sebelius, that framing misses the fact that long before the enactment of the ACA, the Court had said that conditional preemption is generally permissible, while leaving open the question of what the limits on conditional preemption are. That seems like the most natural way to understand the question posed by death spirals as a threat: If that's permissible, then there are no limits on conditional preemption, an outcome that ought to worry the ordinarily federalism-loving enemies of Obamacare.

Meanwhile, my column is also styled in part as a response to opinion pieces by Oklahoma AG Scott Pruitt and Georgetown Law Professor Randy Barnett--each of whom offers arguments against the federalism/avoidance approach in King. Both AG Pruitt and Professor Barnett, I note, say that federalism and avoidance do not give the SCOTUS reason to "rewrite" the ACA, and in that they're undoubtedly correct, but if the relevant provision, in context, is at all unclear, then avoidance is perfectly appropriate. Their arguments against "rewriting" are directed at a straw man.

As an aside, Professor Barnett also objects that "neither party in [King] has ever raised the constitutional [federalism] concern, so we lack adversarial briefing on this issue." But this concern is misplaced. The constitutioanl issues were raised in amicus briefs filed in support of the respondent. In addition to the brief linked above, a brief on behalf of 22 states and the District of Columbia made the point that the ACA did not provide the clear notice required by conditional spending provisions, citing, inter alia, a perceptive column by my Verdict colleague, Professor Vik Amar. Yet another amicus brief, on behalf of my former colleagues Professors Tom Merrill and Gillian Metzger, as well as Professors Abbe Gluck and Nicholas Bagley, made a variety of federalism arguments in the interest of constitutional avoidance. All of these briefs were filed, per the Court rules, three weeks before the plaintiffs' reply brief was due--and that brief in fact did respond to one of their federalism arguments.

I think I nonetheless might agree with Professor Barnett on the general point that, other things being equal, the Court ought not invalidate a law on the basis of a legal theory that has not been fully litigated--but of course, that's not what's on offer here. The federalism arguments presented to the Court are offered for the purpose of construing the statute so as to avoid having to strike it down. Even if the federalism issues had been aired substantially less fully than they have been in this case, it would be completely appropriate for the Court to invoke principles of constitutional avoidance and the other relevant federalism principles in support of the government's reading of the ACA.

Professor Barnett, by contrast, invokes what we might regard as the opposite of constitutional avoidance. He says that if there is a problem of coercion of the states, the Court should nonetheless construe the ACA to disallow subsidies on federally established exchanges, and if death spirals result and the states sue, at that point the Court can respond by invalidating the core of the ACA--the guaranteed coverage and community rating provisions.

At this point in the blog post I was going to explain in measured tones what's wrong with this claim. I might have pointed out that the Supreme Court has made clear that federalism protects states for the benefit of individuals, so that courts should be attuned to issues of federalism regardless of whether the states themselves raise federalism objections. Accordingly, there is little to Professor Barnett's further claim that there's no federalism problem here because Obamacare-hating Republican state executive officials would rather see thousands of citizens in their respective states lose their health insurance than to see the ACA succeed. I might have gone on in that way, but why bother? Instead, I would simply ask readers to re-read the previous paragraph, bearing in mind that Professor Barnett is widely regarded as the leading academic architect of the constitutional campaign against the ACA that nearly succeeded in 2012. And perhaps also to recall the 1968 statement made by a U.S. major to reporter Peter Arnett in explaining why the military had targeted the Vietnamese town of Bến Tre for bombing and shelling, despite the presence of many civilians: "It became necessary to destroy the town to save it."

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Postscript for Linguists: I have occasionally been called to task for using "vague" and "ambiguous" as synonyms for each other, and in the foregoing post I use "unclear" to encompass both ideas.  I am aware that in some technical sense there is a difference between ambiguity and vagueness: an "ambiguous" term points to one of two or more possible meanings, whereas a vague term is merely unclear as to its extension. I understand the distinction and that it can be important in some contexts, but I don't think anything turns on it here. If I had to come down on one side or the other, I guess I'd say that we have here a case of (possible) ambiguity rather than vagueness: either "established by the state" means "established by the state and not the federal government" or it means "established by the state or by the federal government standing in the shoes of the state."

13 comments:

Shag from Brookline said...

How about substituting with "vaguely ambiguous" (or vice-versa)?

Joe said...

Prof. Barnett has by now repeatedly shown he has unclean hands on this law and lectures from him should not really be taken at face value. But, since it's hard to convince people of such things, it's useful Prof. Dorf refutes his argument.

Hashim said...

Ad hominem responses are always much easier than substantive ones. Notably, what you were going to say substantively to pruitt and barnett is facially deficient.

Of course federalism protects states for benefit of individuals. But pruitt's point is that the challengers' reading of the ACA *does* benefit individuals -- the citizens of his states who are freed from the individual mandate, and the employers of his state who are freed from the employer mandate. While other individuals who lose subsidies are harmed, that just makes the condition a cost-benefit calculus for the States, not a coercive penalty. And it's a perfectly rational choice for a State to decide in favor of its citizens who want to avoid govt regulation rather than those who want a govt handout. Indeed, one might think that's what federalism is all about.

Likewise, if the alleged coercion is from the alleged death spirals that would result, then that coercion could be eliminated either by eliminating insurance reforms or by expanding subsidies, since, as you yourself note, the insurance reforms are what cause the death spiral absent subsidies. And eliminating the reforms is the far more appropriate remedy than expanding subsidies, since it doesn't involve allowing billions of dollars of federal spending that congress never authorized, contrary to the constitution. To use your trilemma framework, it's "less" unconstitutional.

Finally, the avoidance canon isn't the interesting/difficult aspect of the federalism issue, which is why pruitt/barnett aren't focused on it. The real question is what Kennedy's going to do if he thinks the statute is unambiguous (as he suggested several times) but also thinks it poses constitutional problems.

Unknown said...

While I have not yet read the post, just looking at the headline, and I apologize if I am excessively pedantic but shouldn't this really be a pre-post-mortem? A prost-mortem? (Is there such a thing?)

PS: I find it ironic on some level, with the Professor and I being Vegans, the captcha which came up had Me select all the pizzas from a set of pictures.

Michael C. Dorf said...

In response to one of the points Hash makes: Professor Barnett says in the piece I link "8 States filed amicus briefs in support of petitioners, saying they don’t want exchanges OR subsidies — so obviously those States aren’t being 'coerced.' " That is what I was responding to in saying that federalism protects states for the sake of individuals, not just states.

I would also note that my pointing out Prof. Barnett's druthers is ad hominem in one sense but not in the classic sense: That is, I was not attacking his character; I respect him and we are friendly. I was simply saying that it's not surprising that he would want the core of the ACA invalidated as a remedy for coercion because he wants the ACA invalidated for other reasons as well--and that perhaps that larger desire is coloring his analysis. So yes, the argument is ad hominem in the sense that I wouldn't offer it if I were responding to the same claim made by someone who doesn't think the ACA is generally unconstitutional. But it is not as though I'm saying "Don't believe anything X says because X is a convicted perjurer."

Joe said...

I think "post-mortem" might refer to the oral argument.

There is a "I'm not a robot" box, but am not required to "x" it. Either that, or maybe I am a robot.

Asher said...

I don't understand your response to Hashim's invocation of Pruitt, or Barnett. Federalism protects states for the benefit of individuals - yes. So the coercion doctrine must too. (That said, the benefits the federalists on the Court think individuals reap from the coercion doctrine have absolutely nothing to do with their getting federal money, unfettered by disruptive conditions - actually, quite the opposite. Rather, it seems to be all about knowing who to hold accountable for various social welfare programs, and freeing states to experiment with not enacting same.)

But whatever your account of the benefits that flow from the anti-commandeering/coercion doctrine, you still need real-world coercion for coercion doctrine to have anything to say here. No coercion means no coercion-related harms, and nothing for coercion doctrine to protect individuals from. An incentive that encourages states to do something, but that still leaves them with a meaningful choice, isn't impermissible under existing doctrine. You seem to accept this in your column and argue the states' choice, on plaintiffs' interpretation, would be illusory. Barnett and Pruitt and Hashim, however, say that's not true. Apparently, there are some diehard states out there, with strange assessments of the costs and benefits of setting up an exchange under plaintiffs' interpretation, that in fact wouldn't set up an exchange because they think they're saving some people from a mandate to buy health insurance by protecting them from refundable tax credits, or some such nonsense. This is crazy, but if it's true, the choice isn't so illusory after all; it's only illusory given an assumption that states would make sane, non-nihilistic, non-zanily-libertarian choices. And that assumption doesn't really hold water in this political climate.

Now, you could get around this problem by shifting coercion doctrine away from its current focus on whether an inducement's very likely to successfully coerce, to focusing on the purpose of the inducement. Something which you may be getting at in this post when you suggest that "attempts to coerce" and "punishments" aren't okay, and which Rick Hills (citing articles by Mitch Berman and Einer Eilhauge) calls for here in more detail:

http://prawfsblawg.blogs.com/prawfsblawg/2015/03/fair-weather-friends-of-federalism-and-nationalism-in-king-v-burwell.html

It strikes me, though, that banning any attempt to coerce, or as Hills puts it, any "condition on a federal grant based on Congress’ beliefs about state officials’ need or desire for that money," or as Eilhauge would have it, any condition that Congress wouldn't carry out if it was unable to communicate the condition to the states, would blow up conditional spending as we know it. Because that's just about every condition. When Congress tells states they lose Medicare money if they don't reimburse at certain rates, it's because it wants to make them reimburse at those rates, not because it's really opposed on principle to giving a dollar of Medicare funds to states that deviate from federal reimbursemeent rates. Actually, Congress would much rather have underreimbursed Medicare in a state than no Medicare. When Congress tells states they'll lose all their federal funds for state universities if they don't equalize numbers of men's and women's sports teams, it's just to make them equalize numbers of men's and women's sports teams, not because Congress has some legitimate non-coercive reason to not fund schools that don't so equalize. Were the threat not communicated, Congress would never carry it out. Small wonder, then, that even the most conservative members of the Court have never propounded this purposive theory of coercion, because it would blow everything up.

Unknown said...

My problem is the law, as written, is not at all unclear on this point: it specifies exchanges established by the state (with a capital 'S' which typically means one of the 50 states and/or DC, as opposed to 's' which often means 'a government') and specifies those established under a specific section; not a specific section or an alternative section.

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