Rule of Law

Carvin’s Cornhusker Quandary in King

On Wednesday, as part of a brief filed by my organization, Constitutional Accountability Center, in King v. Burwell on behalf of state and federal legislators — including Senate Democratic Leader Harry Reid and House Democratic Leader Nancy Pelosi — we dropped a bit of a bombshell. In their Supreme Court briefs (as well as in their arguments to lower courts), the petitioners in King, represented by conservative superlawyer Michael Carvin, have asserted that Congress intentionally agreed to withhold tax subsidies from otherwise eligible citizens living in states that refused to set up a state-run health-insurance exchange. According to petitioners, Congress did this — despite the Affordable Care Act’s clearly stated goal of making health insurance affordable for all Americans — because of politics. Particularly, they say, the ACA would not have passed without the vote of moderate (and now former) Democratic Sen. Ben Nelson, and Nelson, they claim, insisted that tax subsidies be withheld in states refusing to set up their own exchanges. Here’s the key passage from pages 3 and 4 of the petitioners’ brief:


These inducements for states to establish their own Exchanges were compelled by political realities. The House of Representatives initially enacted a bill under which the federal government would create a national Exchange, though individual states could affirmatively choose to establish their own instead. H.R. 3962, § 308, 111th Cong. (2009). That scheme, however, was unacceptable to the Senate. Halbig v. Sebelius, No. 13-623, 2014 U.S. Dist. LEXIS 4853, at *61 (D.D.C. Jan. 15, 2014) (“[T]hese proposals proved politically untenable and doomed to failure in the Senate ….”). Senator Ben Nelson of Nebraska, whose vote was critical to passage, called a national Exchange a “dealbreaker,” expressing concern that such federal involvement would “start us down the road of … a single-payer plan.” Carrie Budoff Brown, Nelson: National Exchange a Dealbreaker, POLITICO, Jan. 25, 2010. For Nelson and some other Senators, it was important to keep the federal government out of the process, and thus insufficient to merely allow states the option to establish Exchanges, as the House bill did. Rather, states had to take the lead role, which, given the constitutional bar on compulsion, required serious incentives to induce such state participation.


Other briefs filed before the Court, one by senators led by John Cornyn, and another by two of the principal architects of the King lawsuit, Jonathan Adler and Michael Cannon, say essentially the same thing on pages 12-13 and 30 and 31 of their briefs, respectively.


So here’s the bombshell: In an exchange of letters cited in our brief and published here, Sen. Nelson rejects that assertion unequivocally, stating, “I always believed that tax credits should be available in all 50 states regardless of who built the exchange, and the final law also reflects that belief as well.” In other words, one of the key assertions made by the central Supreme Court advocates for King has been called false by the very senator relied upon by these advocates.


Not easily deterred, Mr. Adler responded to Sen. Nelson’s letter in a tweet on Thursday morning, dismissing the letter as “post hoc” commentary that the Supreme Court should feel free to ignore.


Adler is right, of course, that post-enactment assertions by legislators about the meaning of legislation are given less weight than contemporaneous ones, but his tweet is nonetheless ridiculous for the following reason: The petitioners’ assertion that Sen. Nelson insisted on conditional tax subsidies is itself pure speculation without a shred of support in the record. Look carefully at the briefs filed by the petitioners as well as by Adler and Cannon and the Republican senators, and look at the citations in them. These briefs assert that Sen. Nelson demanded that tax credits not be available on federal exchanges in order to “induce … state participation,” but the press reports they cite support only the far more limited propositions that Sen. Nelson did not want a single federal exchange and wanted states to be able to create their own insurance marketplaces. Petitioners offer no support whatsoever for the proposition they advance in this lawsuit: that Congress intentionally withheld tax subsidies in states that chose to have the federal government operate the exchange in their state.


Thus, while Sen. Nelson’s letter is indeed a post-enactment account of his understanding of the law and motivations, it is the only piece of evidence in the record or elsewhere that indicates his particular view on a central allegation in this case, which, according to the former senator, has been completely mischaracterized by King and his supporters. It would be surprising if any member of the Supreme Court would take the petitioners’ wholly unsubstantiated assertions about Sen. Nelson’s critical role in the passage of the ACA at face value, particularly in light of his direct and explicit contradiction of those assertions.


In argument before the D.C. Circuit, the petitioners’ lawyer Carvin effectively admitted that the King case “comes down to Sen. Nelson.” If that’s the case, petitioners should lose King 9-0.