WSJ Recycles Debunked Myths To Call On The Supreme Court To Strike Down Affordable Care Act Tax Credits

The Wall Street Journal is once again promoting a right-wing challenge to the Affordable Care Act (ACA) by repeating misinformation about the case, calling on the Supreme Court to strike down some health care subsidies while falsely claiming the law's “plain text” renders them illegal.

On March 4, the Supreme Court will hear oral arguments in King v. Burwell, a case that could block the availability of federal health care subsidies. The plaintiffs in King argue that because a subclause of the ACA states that subsidies are available “through Exchanges established by the State,” consumers who buy insurance over the federal exchange aren't eligible to receive tax credits from the IRS to offset the cost. Without subsidies, people who live in one of the 37 states that don't operate their own health care exchange would be unable to afford insurance.

Despite the case's potential to make health care unaffordable for millions, the Journal has been particularly receptive to the challengers' strained reading of the ACA.

In a March 2 editorial, the Journal made its final pitch before oral arguments, calling the challenge an opportunity for “the Justices to vindicate the law's plain text.” The editorial, like the challengers in King, ignored the context of the ACA as a whole and claimed that the decision to strike down the subsidies should be an easy call for the Supreme Court because the “English language is clear” and the law is unambiguous:

In King, the High Court will scrutinize this IRS decree using the traditional canons of statutory construction. The English language is clear: Congress wrote that subsidies would be available on state exchanges only, so Washington cannot deputize itself as the 51st state -- especially when the black-letter law is as consistent, tightly worded and cross-referenced as the Affordable Care Act.

To take one example, the Secretary of Health and Human Services was empowered to grant unlimited sums of money to states to establish exchanges. But the law appropriated not a penny for the federal exchanges, and HHS raided internal slush funds to build them. If there is no legal difference between the federal and state exchanges, why did HHS need this budget ruse?


ObamaCare's history shows Democrats made a deliberate choice. As they tried to assemble 60 votes in the Senate, holdouts like then Nebraska Senator Ben Nelson intensely desired state partners. Because the federal government couldn't commandeer the sovereign states by mandating participation, the subsidy bait was Congress's constitutional option to encourage buy-in.

The Journal's attempt to make the plaintiffs' case by arguing that the subsidies are illegal because the Department of Health and Human Services had to rely on a “budget ruse” to build the federal exchanges ignores the facts. According to a report from The Washington Post, the Republican-controlled Congress “repeatedly rejected the Obama administration's requests for additional funds” to implement the ACA, including those exchanges Republican-controlled states refused to set up.

The editorial also points to “holdouts” like Nelson as proof that Congress intended to deny subsidies to consumers in states without health care exchanges, but Nelson himself has explicitly said otherwise. As the Huffington Post reported, Nelson sent Sen. Bob Casey (D-PA) a letter in which “Nelson state[d] unequivocally that he never intended to penalize states that opted not to create their own exchanges.” In the letter, Nelson wrote that he "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."

The Journal editorial doesn't mention it, but “traditional canons of statutory construction” generally do not include overturning an entire law based on seven words buried in a subclause. In reality, the courts interpret laws by reading them in context -- in his amicus brief filed in the King case, former Solicitor General Charles Fried explained that the challengers' “crabbed reading does not hold up when” the subsidies clause at issue “is read -- as it must be -- in its statutory context.” As Fried pointed out, there are numerous references throughout the law to the federally created exchange, including several provisions that define the federal exchange as “established by the State,” or “otherwise presume that federal tax credits are available” over the federal exchange.

Moreover, there is the fact that the Journal's account of the choices of the “law's Democratic drafters” is an utter fabrication. As has been extensively reported, the idea that Congress “condition[ed]” the tax credits on the acceptance of a state exchange has been rejected by those who would know. Steven Brill, health care journalist and author of a comprehensive book on the ACA and its passage, called this alternative narrative a "fiction. Provable fiction":

Congress knew exactly what it wanted to do when it passed the Affordable Care Act in 2010, and contrary to the plaintiffs' claim, that included wanting subsidies for buying health insurance on the Obamacare exchanges to be available to all citizens, even those residing in the 36 states that did not set up their own exchanges, instead relying on the exchange set up by the federal government.

I'm a reporter. I hate to take sides. And I certainly didn't in what has been widely reviewed as my even-handed treatment of the merits and demerits of Obamacare in my recently published book about the broken American healthcare system and how Obamacare was conceived and implemented to fix it. But this is one of those issues where reporters err if they write an “on the one hand, on the other hand” story that creates patently false equivalency.


I know what the legislators intended because in researching my book, I interviewed pretty much everyone involved in the conception and writing of the law. Moreover, I did that long before King v. Burwell had become the Obamacare opponents' favorite new weapon, which means that those opponents had no reason to spin the fairytale that Congress did not intend for those subsidies to go to the millions of Americans signing up on the federally run exchange. At the time, no one had a dog in a fight over congressional intent, because there was no fight.

I also reviewed reams of internal emails and memos generated by congressional staffers working for both Democrats and Republicans. In no document from start to finish, in a legislative process that spanned more than two years, is there even a hint of anything but the unambiguous assumption that the law, whose first section is titled “Quality, Affordable Health Care for All Americans,” would indeed provide these insurance subsidies for all Americans who needed them.

Photo via Flickr/Wally Gobetz under a Creative Commons License.