One of the favorite claims of ACA troofers — a means of straddling the “card says Moops!” and “the Moops invaded Spain” versions — is an assertion that every member of Congress assumed that every state would set up its own exchange by the deadline. This argument is, first of all, ludicrously implausible on its face — if you never considered the possibility that a state would fail to set up an exchange, why would you establish a federal backstop that was designed to fail rather than just not establish a federal backstop at all? The “evidence” for this claim doesn’t even rise to the level of being threadbare — a single bare assertion that was obviously an unfounded assumption (unless you think Robert Pear contemporaneously interviewed every member of Congress and asked whether or not they expected all 50 states to establish a workable exchange by 2014 but didn’t bother to include any quotes after going through all that work.)* It is also, as we know, demonstrably false — legislators were aware that red states were likely to obstruct the operation of the law.
Additional evidence is superfluous at this point, but it’s worth citing anyway. Jon Cohn’s January 2010 email interview with a key adviser to Ted Kennedy and the HELP committee makes it additionally clear that Congress was well aware that some states would refuse to set up exchanges, and established the federal backstop in response:
Confronted with arguments that Congress would never have passed a statute that might undermine itself, Cannon and other supporters of the King lawsuit have argued that the exchange provision was supposed to work just like the law’s Medicaid provision. In other words, the exchange tax credits would be like something out of “The Godfather“: an offer that states simply couldn’t refuse. In this telling, Obamacare’s authors supposedly never anticipated that states would turn down the tax credits.
“Congress did try to coerce states with the loss of billions of dollars of federal Medicaid grants,” Cannon and his frequent collaborator, Case Western University law Professor Jonathan Adler, wrote at the website of the journal Health Affairs in 2012. “It stands to reason that the same Congress would do the same thing with regard to tax credits and Exchanges.” Cannon and Adler made a similar argument in a 2013 paper they wrote for the journal Health Matrix: “Having created an enormous incentive for states to establish Exchanges, it likely never occurred to some of the Act’s authors that states would refuse.”
But it did occur to McDonough, from the look of things. In the email copied above, he draws an explicit contrast between Medicaid (which, he thinks, states would never realistically turn down) and the exchanges (which, he concedes, they might).
To Nicholas Bagley, a University of Michigan law professor who worked on two amicus briefs opposing the lawsuit, that contrast is telling. “[McDonough] knew full well Congress couldn’t force the states to participate in Medicaid,” Bagley told me. “What he meant was that the stakes were too high for that to be a realistic option. But the very next thing he says is that opting out of the exchanges was a realistic option. On the plaintiffs’ theory, how could that possibly be? Just as no state could have been expected to opt out of Medicaid, so too no state could have been expected to opt out of the exchanges if billions of dollars were on the line.”
“If the plaintiffs were right,” Bagley went on, “McDonough would’ve said ‘no’ to both questions. The fact that he didn’t is powerful evidence that Congress never meant to threaten the states into establishing exchanges.”
So the email actually further disproves two totems of troofer dogma — that no legislator considered the possibility that states would fail to establish exchanges, and that Congress wanted the backstop to work like the Medicaid expansion (even though it’s blindingly obvious from the text of the statute that it did not.)
In conclusion, if the Supreme Court sides with the troofers Charles is being unfair to Roger Taney here.
*One of the many, many risible elements of bad faith in troofer arguments is their highly selective nihilism about the possibility of making reasonable judgments about what Congress is trying to accomplish. Congress uses a common technique of cooperative federalism and establishes a federal backstop to protect citizens against a failure by a state government to cooperate with a regulatory program? We can’t possibly have the slightest idea of what Congress was trying to do! A reporter makes an assertion, plainly inconsistent with the statutory scheme, that he knows the subjective expectations of each and every member of Congress? This can clearly be accepted as gospel truth without a hint of skepticism!