I blogged earlier today about Paul Ryan’s pointed questions to Sylvia Burwell about the government’s plan B. Here is some post-reactions.
“If the court makes that decision, we’re going to do everything we can,” Burwell told the House of Representatives Ways and Means Committee, after she was asked in a hearing how the Obama administration would react if the court rules against it later this month in the case known as King v. Burwell.
But she added, “The critical decisions will sit with the Congress and states and governors to determine if those subsidies are available.”
“They refuse to acknowledge that they even are thinking about a backup plan,” House Ways and Means Chairman Paul Ryan, a Republican, said after the hearing.
Rep. Kevin Brady (R., Texas) asked Ms. Burwell whether President Barack Obama would make concessions if presented with a Republican bill to extend the tax credits as part of an effort to “work towards a long-term solution.”
“The president has said he will not sign something that repeals the act” or its core elements, Ms. Burwell said.
Burwell’s comments came on the heels of an interview she gave last week to The Wall Street Journal, where she pointed to states like Nevada that rely on the federal IT system for their exchanges already.
Should the high court rule against the law, one option for the administration would be partnerships between the federal government and states that set up their own exchange to keep subsidies flowing to their residents.
HHS spokesman Kevin Griffis said Wednesday that HHS has already been in touch with Pennsylvania and Delaware, two states that have signaled they will seek to set up their own exchanges, while still partially relying on the federal government’s capabilities, if the court strikes down the federal subsidies.
Griffis said HHS is in contact with states “all the time” and is also preparing to communicate with consumers about the effects of a ruling once it is announced.
The high court case is likely to set off a pitched political battle in Washington, should the justices strike a blow to the law.
Sen. John Barrasso (R-Wyo.), who leads the Senate Republican planning effort for the decision, immediately ruled out that option, calling it a “fake fix.”
The option of states working with the administration on a joint exchange also faces a hurdle in Republican-run states. Some Republican governors have already ruled out action on their end, and others have not made clear how willing they would be to work with the administration on an exchange.
“My hunch is if a state wants to play ball, at least as a stopgag, that HHS may find a way to make it happen,” said Mike Adelberg, who was a senior official in the administration’s Centers for Medicare and Medicaid Services until three months ago, and is now a consultant at FaegreBD. “If a state doesn’t want to play ball, then there’s probably very little that can be done for the consumers in that state.” …
Caroline Pearson, vice president at Avalere Health, a consulting firm, said that the states working with the Obama administration on an exchange is “probably operationally the only scenario that allows subsidies to continue without disruption.”
But it is unclear whether the court’s ruling will address how much the federal government can help before the exchange would no longer be considered a state-based exchange.
“Legally whether that’s permissible is going to depend on the specificity of the ruling,” Pearson said.
The last point is an important one. If the Court weighs in on what constitutes a state-based exchange, then HHS will not be able to wave its magic wand.