Since my initial post about President Trump’s executive order on Obamacare, my reaction has been a mix of irony and schadenfreude. Irony, in that all of the precedents set by Secretary Sebelius to salvage the ACA will allow Secretary Price to unravel the ACA. Schadenfreude, in that the cadre of Obamacare acolytes who steadfastly defended Secretary Sebelius’s unfettered discretion, will now be forced to steadfastly attack Secretary Price’s unfettered discretion. (Note to reporters: if your expert have suddenly reversed their position on the scope of the Secretary’s powers after January 20, you should stop calling them).
Yesterday, I spoke at some length with Politico reporter Dan Diamond, who characterized my sentiments quite well in this piece:
Conservatives who railed against Barack Obama’s vast powers to build up the Affordable Care Act declared vindication Saturday with President Donald Trump’s executive order to tear it apart.
“For me, it’s a mix of irony and schadenfreude,” says Josh Blackman, a law professor who’s written two books that criticized the Obama administration’s implementation of the law. “I’ve warned for years that, with a new president in the White House, the exact same powers could be used for different purposes. That’s what we’re seeing now, to a T.”
The core purpose of the executive order was to shift the prioritization of the administration. President Obama’s priority was to encourage as many people as possible to enroll on the exchanges. (Many of his actions, which were designed for short-term enrollment gains, had the long-term effect of sabotaging the marketplace.). Now, the priority has shifted to minimize the burdens imposed by Obamacare. As I’ve been warning for years, what comes around goes around.
Nick Bagley, whom I’ve had the good fortunate to interact with throughout this Obamacare fight, agrees that precedents set by the Obama administration can now serve as sources of authority for the Trump Administration. (Kudos to Bagley for maintaining a consistent position on the scope of the Secretary’s powers–he is one of the few).
That could be devastating to Obamacare because the administration relied on its executive authority to set up the law.
“Its implementation depended critically — and depends critically — on rules and guidance that HHS and other agencies have put out,” says Nicholas Bagley, a University of Michigan law professor who supports the ACA. “There are literally thousands of decisions that had to be made” by the administration — and “any decision that the Obama administration had the discretion to make, in principle, the Trump administration can revisit.”
For example, the Obama administration twice delayed the employer mandate. The first go-round, the rationale was that the IRS was not ready to have the forms to process the employer mandate, so they needed more time. At the time, I called bullshit, but whatever, government moves slow. But a few months later, the mandate was delayed and modified, such that certain smaller employers were subject to a different mandate. None of that was in the statute. With this history in place, the Trump Administration can issue even more delays, such that it may never go fully into effect. Bagley largely agrees:
The vast, and at times, legally questionable decisions undertaken by the Obama administration may also set precedent for the Trump administration to do the exact same thing. Both Blackman and Bagley agree the administration’s 2013 decision to delay Obamacare’s employer mandate was unlawful; House Republicans even sued, although their challenge was thrown out in court. Trump could now cite that delay as precedent for declining to enforce provisions that he dislikes.
A second precedent was the so-called “hardship exemptions.” Secretary Sebelius deemed it a hardship if anyone had difficulty affording insurance under the ACA, permitting a waiver of the individual mandate. As Ezra Klein famously put it, “Obamacare itself is the hardship”. (This proposal was first sketched out by Austin Frakt and Nick Bagley–see Update 2). Trump’s order follows a similar pattern.
A third relevant precedent was the so-called “administrative fix.” As the ACA was designed, states were asked to modify their insurance markets to prohibit the sale of such policies. If a state declined to regulate the marketplace (they could not be required to), the Secretary of HHS “shall” do it in their place. Of course, under the “administrative fix,” Secretary Sebelius told states that if they declined to enforce the mandates, she would do nothing. Technically, she said she would never make the determination that states were noncompliant, thus her duty to backfill was never triggered. This argument was specious (see this letter from WV AG Morrisey) but it now allows Secretary Price to do the same–he could simply never determine if states are complying, thus the mandates will not be enforced in the state.
One curious note. As I noted on January 12, the Supreme Court called for a response to West Virginia’s petition for a writ of cetiorari. Their suit challenges the legality of the administrative fix. D.D.C. and CADC dumped the case on standing grounds, but all issues are squarely teed up for the Court. The Trump DOJ will have to file a reply by February 10 (though that date will likely be pushed forward).
One caveat–the Politico article conflates the “hardship exemptions” and the “administrative fix” but gets the sentiments correct. (Bagley thinks the “administrative fix” is unlawful, but helped propose the “hardship exemption” approach). Whatever Obama did to increase enrollment now sets the stage for Trump to do the opposite to relieve burdens.
The Trump administration could also issue a slew of waivers to exempt Americans from the ACA’s individual mandate – although the Obama administration already broadened those exemptions in 2013, after the political outcry from Americans whose plans were canceled because they didn’t meet Obamacare criteria.
The “‘like it, keep it’ fiasco” set a precedent for Trump too, says Bagley.
At the time, the administration said it would give hardship waivers to Americans who had difficulties paying for coverage under the ACA. But “if you define the hardship as that, then every American is facing higher premiums because of the ACA, one way or another,” says Blackman. “Obamacare is itself the hardship.”
As I explain to my students every semester, most decisions about the scope of the executive’s powers are made not by the courts, but by the executive branch. Past practice, though not dispositive of the legal question, can serve as a “gloss” on the President’s lawful authority. Courts, by and large, respect long-standing precedents. Noel Canning, perhaps more than any other decision, articulates this view. Alas, a few blog posts and letters from Secretary Sebelius hardly satisfy as the sort of long-standing precedent that is entitled to weight.
I would relish in a judicial decision, bolstered by fair-weathered separation of powers fans, that cabin the executives unfettered discretion.