What’s next after Obamacare’s defeat in Halbig v. Burwell? [updated]

As Steve has noted, the U.S. Court of Appeals for the District Columbia today invalidated the IRS regulation that provides for insurance subsidies to millions of lower-income Americans using the federal Obamacare exchanges. The ruling means that in 36 states, Obamacare subsidies will not be available, making its insurance coverage unaffordable to many Americans and potentially crashing the system.

The Court’s ruling, by a vote of 2-1, is clearly correct. The statute expressly limits federal subsidies to health insurance exchanges “established by the State.” A federal exchange is manifestly not an exchange established by the State.

It is not the proper role of courts to rewrite statutes to make them better comport with how Congress may have intended them to operate. That’s the self-appointed job of administrative agencies, and it’s not a proper role for them either.

As an old-time Maryland judge once wrote, if the legislature didn’t intend for a statute to mean what it says, it should have said so.

Nancy Pelosi didn’t say so. Instead, she said Congress needs to pass Obamacare to find out what’s in it. Congress passed the law, we found out what’s in it, and the contents do not include subsidies for those using the federal exchange.

Pelosi may get the next laugh, however. There’s a decent chance the decision will be reviewed en banc — i.e. by the full D.C. Circuit. That court was recently “packed” when Harry Reid changed the age-old rules for confirming judges below the Supreme Court level to effectively preclude filibusters.

The result is three new left-wing judges on the D.C. Circuit. They are prepared, presumably, to rubber-stamp almost anything Obama desires, and certainly to ignore the plain language of Obamacare in order to sustain the president’s signature legislation. Their votes could prove decisive in overturning today’s 2-1 ruling.

Will the Supreme Court become involved? Probably not until a Court of Appeals rules definitively as the D.C. Circuit ruled today — in other words, only if today’s ruling avoids or survives en banc review or another appeals court reaches the same result and it avoids or survives such review.

Absent a court of appeals ruling disturbing the status quo, the Supreme Court is not likely to inject itself into this dispute. Indeed, the Supreme Court might act even more cautiously and wait for a split among the Circuits.

What can we expect from the Supreme Court if it reaches the subsidy issue? My guess is that Obamacare is already sufficiently entrenched (and will be even more so when/if the Supreme Court rules) that a Supreme Court majority willing massively to disturb the operation of the Act will be hard to come by.

That, at least, is how things seem to me at first blush.

UPDATE: How does en banc review work in the D.C. Circuit? The standard for obtaining such review requires either a lack of uniformity in panel decisions (which isn’t present here) or a question of exceptional importance. It’s easy to argue that Halbig presents such a question. Thus, although en banc review is rare in this Court (as in most), the standard won’t be a hurdle for judges who desire en banc review.

Only the “active” judges of the D.C. Circuit decide whether to hear a case en banc. And only the active judges, plus any senior judges who were on the original panel, are eligible to hear a case en banc. This is unfortunate because this particular court is full of excellent conservative senior judges.

Among the non-senior judges, though, the majority is now decidedly liberal, thanks to Harry Reid’s court packing. Of the 11, only Judges Henderson, Brown, Griffith, and Kavanaugh were appointed by a Republican president.

Two of the judges on the panel that decided Halbig are senior. Of the two, Ray Randolph was in the majority and Harry Edwards dissented. So in the event of en banc review, they will cancel each other out, leaving the liberal majority of active judges in control of the outcome.


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