By Thomas P. Miller

Playing The Family Glitch Feud mostly comes down to whether you
are going to believe your clear legal eyes and statutory history memories, or
follow your bleeding hearts. Was it ever thus?

Today’s Part II deals with the counterarguments still attempted by
legal apologists for twisting these rules into something else by manufacturing
unrelated ambiguity. It then explains how they represent part of a much larger
problem in law and regulation overall.

Renewed fans of Top Gun countermeasures for aerial combat will
recall the use of chaff and flares to divert attackers. Smokescreens worked for
naval ships of earlier eras. In the latest Family Glitch revival of our
countless Affordable Care Act (ACA) legal wars, radical rule change advocates resorted
to the distractions of an older, flawed IRS interpretation in 2013, which tried
to link its Family Glitch analysis to other regulatory language involving
penalties under the ACA’s now-largely-repealed individual coverage mandate. Although
leaving the crumbs of one’s regulatory interpretation mistake behind on the
table might be seen as a parting gift for future regulatory revisionists, the
two are unrelated here. The statute is clear where it matters on subsidy
eligibility for employee dependents—it’s the affordability of employee-only
coverage offered by an employer that controls all, particularly for premium tax
credit eligibility, as well as whether softly enforced employer mandate penalties
even apply. Dragging in unrelated definitions for affordable coverage under the
dearly departed individual mandate also overlooks the broader preexisting regulatory
discretion of the Health and Human Services Secretary to invent and provide all
sorts of affordability exemptions from its toothless, vestigial exhortations
(see, for example, the aftermath of the Healthcare.gov screen freeze in the ACA’s
2013 rollout period).  

However, focusing just on these technical skirmishes within the
lax bend points of modern administrative practices and procedures can miss the
broader battlefield of politics through law.

On one hand, there sits a statute that Congress actually managed
to pass in March 2010 (please avert your eyes). Its language concerning the
purported Family Glitch was deliberate, if not deliberative. It never was
amended, despite multiple attempts to do so since then. These points are not
ambiguous. The effects may not have been generous, or fair, or whatever others
in the operational minority might have preferred. But until they manage to
succeed legislatively, the less-accountable hands of IRS and HHS administrators
should remain bound by what the law still requires.

On the other hand, it’s just so hard to assemble new legislative majorities to hand out even more subsidies for health care coverage. You can’t count on a pandemic to trigger a tsunami of new federal spending every single year! Meanwhile, a rising tide of more red ink might miss a few unsubsidized boats. Even the one-time strategy of loading up temporarily bloated ACA insurance subsidies and then daring anyone not to extend them later is looking more today like a late-stage game of political Russian roulette before this November’s elections, with the gun in the hands of Democrats and most of the empty chambers already fired.

The lure grows stronger for a regulatory bypass route around all
of these woes for an administration that promised far more than it could deliver
and now sees its popularity ratings sinking, too.

Hence, another quick fix to post something, somehow, somewhere on
the health policy board by whatever regulatory means will do for now.

What’s the harm in exploiting the slightest ambiguity in congressional statutes to create more opportunities to dispense federal funding in the name of fairness and equity? Well, twisting the occasional acts of Congress into mere suggestions for unchecked executive branch spending discretion could even be used to try to … build a border wall! Or sell arms for hostages, and fund covert insurgencies on the side. Choose your ox to gore.

Can the Glitch as a Gift be stopped in court? The fix is more or
less in at the rulemaking stage, despite the cosmetic process ahead of
reviewing the latest round of regulatory comments. High hurdles for subsequent
legal challenges to the latest IRS rule rewrite include enlisting plaintiffs
with patience, funding, and most of all legal standing. Depending on the court
forum in which one shops, that’s no easy task. State government injuries
through increased Medicaid spending can be dismissed as too uncertain and
contingent on the decisions of others, as well as offset by other revenue
gains. Most private-sector health care interests already are co-opted.
Individual plaintiffs would have to argue that they risk seeing the quality, if
not the affordability, of their coverage choices reduced under the new rule. On
balance, it’s not impossible to do this and prevail ultimately through a “major
question” judicial override of manufactured Chevron and Auer ambiguity
caselaw, but “Very Difficult” left the courthouse with a weak stomach a while
ago.

The Capraesque “Why We Fight” movies of WWII have been retitled today as “How We Weasel Our Way Through ACA Administration and Interpretation.” There oughta be a law, but it now takes two other branches besides the executive one to ensure that it’s faithfully executed. Meanwhile, larger problems grow in the rule of law and political accountability.

The post The Family Glitch, Part II: Will a Reconstructive Gift Keep on Giving? appeared first on American Enterprise Institute – AEI.