Obama Care’s Mortal Threat

Last week, we learned that the Affordable Care Act of the United States faces a new, and potentially mortal, threat for the first time.

And what is the source of the threat? Believe it or not, its threat is itself. More specifically, it is a single phrase that lies buried within its thousands of pages of legal jargon.

You see, the Act provides citizens with financial subsidies to purchase health insurance on each state’s online web site. The subsidy levels are based on each citizen’s annual income level; without those subsidies, health care coverage would probably be unaffordable for all but the wealthiest Americans.

So what is this threat? Well, according to the legal text, each of the fifty states can choose to either develop its own customized web site, or to utilize the federal government’s “built for every one” web site. And if a state chooses to develop its own site, it can either operate its site with public employees, or it can subcontract the function to private organizations.

Thus, a diverse array of options has emerged during the past year. Although more than two thirds of the states have opted for the federal government’s site, the remaining states are selecting from a wide range of choices.

Some are designing their own sites to integrate seamlessly with other state benefit systems. Others are contracting with for-profit heath insurance corporations to design freestanding sites. And some states are even acquiring software that is already in use in other states.

It appears that a healthy, competitive free market is now emerging to serve the needs of the states regarding the Affordable Care Act, doesn’t it? So what is the Act’s mortal threat?

Apparently, opponents to the Act are focusing on a single vague phrase in the original law. The language in Section 1401 states that subsidies are available to citizens covered by health plans “which were enrolled in through an Exchange established by the State.”

So if a state decides to adopt the federal government’s Exchange site, is it utilizing a site “established by the State,” or is it using a site established by the federal government?

Opponents to the Act claim that the latter is true, and that more than two thirds of the states have thus opted for a choice that deprives its citizens of the very subsidies that make health care coverage affordable to all. Supporters of the Act, conversely, claim that the former is true, and that citizens of all states can receive subsidies.

Last week, a federal court in Washington DC decided that the Act’s opponents are interpreting this ambiguous phrase correctly. It thus declared that citizens in more than two thirds of all states are not eligible for subsidies.

But just hours later, a different federal court in Virginia decided that the Act’s opponents are wrong. That court declared that the writers of the federal law could not have possibly intended to deny subsidies to citizens of states that choose to use the federal Exchange site.

It will undoubtedly take months, or even years, for the dispute to work its way through the federal court system. Nevertheless, the case represents a disturbing illustration of America’s dysfunctional political and legal systems.

After all, an opponent of any lengthy and complex law will always be able to find a vaguely written phrase that can be interpreted in a counter-productive manner. By allowing opponents to tie up such laws for years of legal challenges, the American judicial system makes it less likely that such transformative legislation will be drafted, debated, and passed into law at all.

And if there is one fact that Americans across the ideological spectrum can agree upon, it is that many of the nation’s economic and social sectors are in desperate need of transformation. Thus, the Affordable Care Act’s ambiguous phrase is more than just a mortal threat to the Obama Care program.

It may well represent a mortal threat to the nation’s ability to address any of the underlying causes of its troubling economic and social malaise.

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