Halbig v. Sebelius is a misfire, not a silver bullet

Two important cases challenging different pieces of Obamacare had oral arguments last week. The Hobby Lobby challenge to Obamacare’s contraception mandate before the Supreme Court received most of the attention, but another case with far more significance for the law’s fate was also argued before the D.C. Circuit Court of Appeals. This case – Halbig v. Sebelius – threatens to unravel the law – to render key components of it inoperable in a majority of states.

Halbig’s attack on Obamacare’s subsidies poses existential threat to the law – but I believe it to be an empty existential threat. While the oral arguments in the case left many spectators concerned for the future of federal exchange subsidies, this is because the government and the law’s supporters are failing to make a crucial argument that could deflate the challengers’ central theory.

In short, the implications of the Obamacare challengers’ theory of the law means that Congress attempted to incentivize states not just with subsidy losses but also with sweeping collateral damage to their insurance industries. Such a move may very well be unconstitutionally coercive on the states, so constitutional avoidance doctrine should guide courts away from this interpretation of the statute and toward the government’s argument that the text of the statute is imperfect but does indeed make subsidies available on all exchanges.

1. The Supreme Court’s decision in NFIB v. Sebelius

To understand why Halbig is a misconceived challenge, it is important to recall what happened in the first wave of lawsuits challenging Obamacare. In 2012, opponents of President Obama’s health care reform brought legal challenges against two key pieces of the law: the individual mandate and the Medicaid expansion. The individual mandate requires most Americans to carry health insurance or else pay a fine. In NFIB v. Sebelius, a majority of justices agreed that this mandate exceeds Congress’s power to regulate commerce. However, Chief Justice Roberts cast the decisive fifth vote to save the individual mandate, determining that if Congress couldn’t impose it under its commerce power, it could do so under its power to tax. The individual mandate, therefore, was constitutional.

The other, less discussed part of the law challenged in NFIB was the Medicaid expansion. One way that Obamacare sought to expand health insurance coverage was by expanding the number of people eligible for Medicaid. Specifically, Obamacare sought to make all people earning below 133% of the federal poverty line eligible for health care coverage through Medicaid. Because Medicaid is run jointly by the state and federal governments, the Obama administration could not just order the states to expand their Medicaid programs – the Constitution prohibits the federal government from “commandeering” the states to enact policies. Rather, Obamacare – through an old provision of the Social Security Act, which governs Medicaid – made expanding Medicaid a required condition for any Medicaid funding: that is, if states didn’t expand Medicaid, they could lose all federal Medicaid funding.

The Supreme Court said that this was unconstitutional coercion on the states. Because they heavily rely on federal money to support their Medicaid programs, states could not afford to refuse to expand their Medicaid program. Rejecting the expansion and losing federal funding would decimate state Medicaid programs and wreck state budgets. The Court decided that this wasn’t a real choice – it was akin to being asked to choose with a gun to your head. The upshot of this decision was that the Medicaid expansion became wholly optional with no threat of lost funding.

2. The Arguments in Halbig

So Obamacare opponents won on the Medicaid issue and narrowly lost on the individual mandate. Undeterred, they came up with a new challenge attacking the law’s tax credits that make it easier for lower- and middle-income people to buy health insurance on the individual market. Led by lawyers from the conservative Cato Institute, Obamacare opponents argued that the text of the law itself denies health insurance subsidies to the millions of Americans who have purchased their insurance on exchanges run by the federal government.

This is their argument in a nutshell: A central part of Obamacare was creating health exchanges in each state where people could directly buy health insurance if they couldn’t get it through their employer. These exchanges were meant to be a simple way for people to purchase insurance and to promote greater competition among insurers, leading to lower premiums. Obamacare gave states the option of opening and running their own exchanges. If they chose not to do so, then the federal government would run an exchange in that state for them.

The Obamacare opponents argue that the text of the law only gives tax credit subsidies to people who buy insurance on an exchange run by a state. If this interpretation is correct, it will take away subsidies from people in states that refused to create an exchange – that is, those who bought their insurance on federal health exchanges (the embattled Healthcare.gov). These people would then likely be unable to afford the insurance that they have purchased. Moreover, without subsidies, the law’s individual and employer mandates would be weakened to the point of irrelevance. Each mandate is tied to the availability of affordable health coverage, defined as about 8 percent of income. Without subsidies, health coverage becomes a lot less affordable for many people, leaving them exempt from the individual mandate.

Why would the law do this? Obamacare opponents theorize that Congress wanted to create an incentive for states to run their own exchanges. According to them, Congress used the exclusivity of health insurance subsidies as a carrot to entice states to choose to operate health exchanges. Having more states run their own exchanges would, of course, reduce costs for the federal government. According to Obamacare opponents, Congress miscalculated the incentive power of these subsidies, as 34 states have refused to run their own health exchanges.

The law’s supporters, however, resist this interpretation of the law. They acknowledge that the text of the statute is messy, convoluted, and ambiguous in places, but maintain that it can certainly be read to give out subsidies on both types of exchanges. For example, Section 1563 of the statute appears to (counter-intuitively) define a federal exchange as a state exchange. Other parts of the law demand disclosure reports from both state and federal exchanges on the amount of subsidies being issued and otherwise imply that buyers on both types of exchanges are eligible for subsidies. All of which makes it less clear that issuing subsidies on federal exchanges raises any problem at all.

Moreover, the fundamental purpose of the law was to expand health insurance access. Depriving insurance subsidies from federal exchange consumers undermines this goal. Under this reading, Congress merely gave states an option to control their own health exchanges as an act of federal-state cooperation. If states chose not to run their own exchanges, the federal government would step in to do so – subsidies and all.

The goal of Obamacare opponents is to get their case to the Supreme Court and have the federal exchange subsidies struck down. The individual and employer mandates would go down with the subsidies, unraveling the core of the law in 34 states. Obamacare opponents have brought cases in multiple appellate circuits across the country. If two or more circuits disagree about the legality of the federal exchange subsidies, the Supreme Court is almost guaranteed to take the case.

3. Halbig’s Fundamental Flaw

There is one significant flaw in the argument against Obamacare’s subsidies: their theory of what Congress did might not be constitutional. In the opponents’ view, Congress used insurance subsidies to pressure the states to create health exchanges. Beyond this, however, the structure of Obamacare threatened to inflict even graver harm on the states. The law bans insurance companies from excluding people with preexisting conditions or price discriminating against them through medical underwriting. Without an effective individual mandate, people could wait until they got sick to purchase insurance. This would cause massive adverse selection, culminating in what’s known as an insurance death spiral – a phenomenon where insurance pools become increasingly and disproportionately comprised of expensive sick people until the insurance market collapses. Without subsidies, more and more people would be exempt from the individual mandate as the cost of insurance escalated, resulting in a death spiral.

Because Obamacare’s individual mandate is only effective if subsidies are available, the opponents’ theory essentially means that Congress threatened states not just with a loss of subsidies, but with an insurance market meltdown if they failed to create a health exchange. After the Supreme Court’s decision on the Medicaid expansion in NFIB, we must seriously wonder whether it would be constitutional for Congress to do such a thing.

Remember, in NFIB the Supreme Court said that it was unconstitutionally coercive for Congress to tell the states that they would lose all Medicaid funding if they failed to expand their Medicaid programs. The federal demand in that case was that states expand Medicaid to cover more of the poor and near-poor. The coercive “gun to the head” was cutting all funding for traditional Medicaid and wrecking state budgets.

Similar coercive tactics are embedded in the Obamacare opponents’ theory in Halbig. (Indeed, Obamacare opponents have partially argued coercion in court.) The federal demand is that states create health exchanges. The coercive gun to the head is a death spiral on state insurance markets imposed by federal regulation. Without subsidies, the individual and employer mandates are essentially inactive, but the bans on preexisting conditions and underwriting restrictions are active. This regulatory environment would devastate the insurance markets in states that opted out of creating health exchanges.

Such behavior by Congress would seem to raise serious constitutional problems after NFIB. Therefore, in a potential Halbig Supreme Court case, the Court would have to choose between two competing theories of the statute: either that it is a coercive incentive scheme, or that it might be an inartfully drafted statute that meant to make subsidies available on all exchanges. The first theory raises constitutional problems, while the latter does not.

Which gets us to the heart of the matter: this is the same exact choice that Chief Justice Roberts faced with the individual mandate in NFIB. In that case, Chief Justice Roberts analyzed the individual mandate and determined that it would be unconstitutional under a commerce clause theory, but would be constitutional under a taxing power theory. The Chief Justice therefore upheld the mandate as an execution of Congress’s taxing power.

This was not a charitable moment of fleeting liberalism by the Chief. Importantly, the decision that his reasoning led to was compelled by a long-held doctrine of statutory interpretation. When courts are presented with two competing interpretations of a law, one that raises constitutional problems and one that does not, courts must adopt the vision of the law that raises no constitutional problems. Chief Justice Roberts relied on this exact canon – known as constitutional avoidance – in upholding the mandate in NFIB. “[E]very reasonable construction must be resorted to, in order to save a statute from unconstitutionality,” he reiterated.

Therefore, in Halbig, constitutional avoidance would require courts to reject the Obamacare opponents’ theory of the law because it might be unconstitutionally coercive on the states under NFIB. Courts should choose the equally plausible interpretation of the law presented by the government and Obamacare supporters: that although its text may seem ambiguous, it can reasonably be read to offer subsidies on federal exchanges while giving states the option to control their own insurance marketplaces.

4. Other considerations

Some might resist the above analysis on the grounds that the coercion on the states in Halbig is less severe than in NFIB. States declining to create an exchange could impose their own individual mandates to prevent an insurance death spiral, or take other measures to shore up their insurance markets. However, similar arguments could have been made about Medicaid in NFIB. States declining to expand Medicaid could have taken measures to fund their traditional Medicaid program, such as reallocating budget priorities, raising additional tax revenue, or even repealing balanced budget amendments so as to run budget deficits. Therefore, the existence of alternative state actions does not seem to make a coercive federal program any less coercive.

If anything, constitutional avoidance is easier to invoke in Halbig than it was in NFIB. In reading the individual mandate as imposing a tax in NFIB, Chief Justice Roberts had to go against both the explicit text of the statute and public statements of President Obama and other key policymakers claiming that the individual mandate imposed a penalty and not a tax. On the other hand, Halbig deals with a section of Obamacare that is highly ambiguous and open to numerous plausible interpretations. Invoking constitutional avoidance in Halbig does less violence to the text than doing so in NFIB.

Moreover, striking down key components of Obamacare has, if anything, become more politically difficult for the Court now than it was in the heated summer of 2012 when the Court decided NFIB. Commentators praised Chief Justice Roberts’s opinion as a politically savvy masterstroke, simultaneously advancing conservative goals of reining in the federal commerce power while protecting the Court from charges of ignoble politicization. Still, it would have been far easier for Chief Justice Roberts to gut Obamacare in 2012 – when the law’s benefits had not yet fully “gone live” – than in 2014, when millions of Americans have relied upon subsidies to gain coverage through federal exchanges. As the curator of the Court’s legitimacy, the Chief Justice would be acutely aware of the mounting political and social costs of invalidating a now-active health care reform.

As in NFIB, a potential Halbig decision presents the Chief Justice with an opportunity to both advance conservative goals while upholding President Obama’s signature domestic achievement. Invoking constitutional avoidance, and explaining why the Obamacare opponents’ incentive theory raises serious constitutional problems, further fleshes out the Court’s nascent coercion doctrine and protects federalism and states’ rights. Doing so is precisely what compels the Court to interpret Obamacare in line with its supporters’ theory of the law – an interpretation that raises no constitutional violation and leaves the law intact.

Certainly, there are other significant holes in the Obamacare opponents’ theory of the law. If Congress committed a political miscalculation in believing that exchange subsidies would entice states to run their own exchanges, then certainly the states too committed a gross miscalculation. Refusing to create an exchange as an act of protest against the president may have been a politically beneficial move for some governors and state legislators. But would it have been worth a self-inflicted insurance market death spiral? There appears to be no evidence that anyone – policymakers or otherwise – at the state level debated or even anticipated that the loss of subsidies or the ensuing insurance market calamity would be a consequence of declining to establish an exchange. If the subsidies were a carrot for the states, then the law’s supporters certainly did an incompetent job of communicating this.

All of which is to say that Obamacare should be safe from a Halbig-style challenge before the Supreme Court. Constitutional avoidance doctrine, coupled with the full coercive implications of the Halbig litigants’ arguments, should guide the Court away from the position of the law’s opponents. Obamacare, then, will live to fight another day.

The battle to game the electorate

The New York Times has a sobering look today at the effort by Republicans in key swing states to limit early voting and convenient registration. It is a worthy reminder that the battle for political power across the United States is increasingly being waged over what electorate actually makes it to the polls.

The partisan impact of these laws is no secret: they make it harder to vote for groups like the working poor, minorities and students that overwhelmingly vote Democratic. Republicans have relied on preventing voter fraud as a pretext for these laws. This, however, is an extremely flimsy pretext – in-person voting fraud is virtually nonexistent, but this has not stopped Republicans from legislating against it. In Texas, attorney general and gubernatorial candidate Greg Abbott has warned of an “epidemic” of voter fraud and backed Texas’s strict voter ID law. However, when pushed to give instances of this “epidemic,” Abbott was able to cite exactly 2 cases of in-person voting fraud during his 13 years in office.

Moreover, the broader package of Republican voting reforms bears little relation to preventing voter fraud. As the New York Times explains:

“North Carolina passed the country’s most sweeping restrictions on voting. The law did away with same-day voter registration and a popular program to preregister high school students to vote. It cut early voting to 10 days from 17, mandated a strict photo identification requirement that excluded student and state worker IDs and ended straight-ticket party voting, all of them measures that are expected to hurt Democrats, election law analysts said.”

The arbitrary policy choices bear little relation to preventing fraud (why would student preregistration be any more susceptible to fraud than any other registration drive?). The acceptable forms of identification are also unabashedly correlated with partisan assumptions: in North Carolina, IDs given to liberal-leaning students and government employees won’t cut it, while in Texas, a license to carry a concealed handgun most certainly will.

Recognizing that the voter fraud rationale isn’t fooling anyone, Republicans have begun to trot out a new reason to support voting restrictions: “uniformity.” This argument takes two forms. First, some Republican lawmakers argue that there should be uniformity across all counties within a state as to voting rules. This, however, doesn’t explain why voting rules must be uniformly restrictive rather than uniformly permissive – there’s no reason why all counties can’t have uniformly long windows of early voting, for example.

The second uniformity argument is about uniformity in the electorate’s deliberation – that is, ensuring that voters go to the polls at the same time with roughly the same information. George Will lamented early voting as watering down our (small r) republican ethic: “Instead of a community deliberation culminating in a shared day of decision, an election [with widespread early voting] is diffuse and inferior.”

As election law expert Rick Hasen pointed out, the credibility of this conservative objection to early voting is dubious given that it applies equally to absentee voting, yet is seldom used to critique that (traditionally Republican-leaning) method of early voting. Moreover, if Election Day were truly a day of communal decision-making and republican deliberation, then it ought to be a national work-free holiday to encourage both full reflection and participation. Instead, it’s a day where most of us with the economic security to work a single eight-hour job squeeze in a trip to the polls on our way to or from work.

All of which is to say that the uniformity pretext has little more substantive value to it than the trivial anti-fraud one. The truth is that the Republican push for restrictive voting laws is about simple political electorate shaping. Observers from Nate Silver to President Obama recognize the power that the composition of the electorate plays in dictating election outcomes. The last several midterm electorates have been relatively older and whiter, and therefore more conservative-leaning, while presidential electorates have been younger and more diverse, and therefore more liberal-leaning. The goal of these voting laws, then, is to shape the electorate so that all elections are more likely to look like midterms than presidential contests.

This project has become significantly easier in the wake of the Supreme Court’s Shelby County decision last year, which freed states from federal supervision over potentially discriminatory changes to voting laws. Yet as our politics grow more racially polarized, it becomes harder to disentangle race from party as the motive behind attempts to depress the vote – particularly as Republicans openly debate doubling down on trying to win elections as a predominantly white party.

The truth is that our parties have vastly different incentives when it comes to who should vote. Democratic incentives favor more voting, while Republican incentives favor less voting. As Slate‘s Dave Weigel summed up the Wisconsin voting restriction effort: “Cursed With Nation’s Second-Highest Turnout Rate, Wisconsin Restricts Early Voting.” Voting shouldn’t be treated as a game to be manipulated, and we shouldn’t buy the phony conservative policy justifications for crass political electorate shaping.

The Common Core Dilemma

On Monday, Indiana became the first state to withdraw from the Common Core national standards for reading and math.  These standards have been adopted by 45 states over the past several years, spurred by federal grant money that was dangled as part of the Race to the Top competition.  Designed by the National Governors’ Association, they were meant to provide uniformly high standards for students across all states.

Recently, however, Common Core has stoked the ire of conservatives who (inaccurately) view the standards as a Washington-imposed national curriculum.  Conservatives have long resisted federal education initiatives that are thought to impede upon local school control, and see Common Core as the latest egregious attempt at a federal takeover of our schools.

While conservatives in Indiana and other states may contemplate a noisy exit from Common Core, this may be more sound than actual fury – they might be leaving the Common Core in name only.  As the Huffington Post reports:

[A]ny program [Indiana] adopts as an alternative is unlikely to be much different [from Common Core]. Retired University of Arkansas professor Sandra Stotsky, a Common Core opponent whom Pence asked to review a draft of new Indiana standards up for a final State Board of Education vote April 28, called the proposed changes a “warmed-over version of Common Core’s standards” for English, the Indianapolis Star reported Monday.

The original author of the measure removing Indiana from the national standards, state Sen. Scott Schneider, R-Carmel, pulled his name from the bill at the last minute this month after learning that other lawmakers had altered the measure to require the state to still meet national education standards so it won’t lose federal funding.

It will be extremely difficult for individual states to actually leave the substance of the Common Core standards behind, if not the formality of the name.  States face not just federal funding losses, but also a competitive disadvantage for their students: if all other states have higher education standards, then a state like Indiana would hurt its students’ chances in the national workforce by doing anything that is seen as weakening their standards.

In essence, Common Core has created a collective action prisoner’s dilemma among conservative state governors.  And this was wholly by design in the Race to the Top competition.  Race to the Top was a brilliant initiative embedded in President Obama’s 2009 economic stimulus package.  The federal government hosted a competitive grant among the states, offering money to the states that enacted the most education reforms.  The administration awarded points to each state based on factors like its willingness to expand charter schools and whether it had adopted Common Core.  The states with the most points then won federal grant money.

Race to the Top allowed the administration to leverage substantial state reform with no actual federal intervention for a relatively small amount of grant money (only about $4 billion out of the $787 billion stimulus act).  The hope of winning this money to shore up their education budgets in the midst of a crushing recession led states to move quickly in adopting education reforms like Common Core.  Race to the Top essentially inverted the traditional collective action problem faced by states – it made states hesitant to be inactive on education reform.

Common Core proliferated rapidly across the country, which makes it highly sticky – states will find it difficult to truly abandon these standards.  And with Common Core now being woven into the revamped SAT and ACT, states will find it even harder to truly depart from its standards without leaving their students unprepared for college admissions tests.

So for now, talk about states abandoning Common Core amounts to little more than conservative huffing and puffing.  According to the Washington Post, Indiana’s approach is “similar to the approach several other states are taking: Pass standards nearly identical to Common Core, but under a different name.”  That is, do just enough to capitalize on political uproar, without making any actual substantive policy change.

The move by some states to withdraw from the Common Core standards is just political posturing as of now.  The proliferation and entrenchment of Common Core in our educational institutions makes using its standards in one way or another just about inevitable.

Welcome

Starting up this space to stretch out my writing muscles when the inspiration strikes me.  Likely to feature a lot of legal and policy nerdery – hopefully written accessibly with something interesting to say – along with other random interests like thought pieces on the rockhopper penguin and the significance of Pearl Jam’s No Code.

Hobby Lobby, Corporate Power, and Employer-Sponsored Health Insurance

On Tuesday, the Supreme Court heard oral arguments in a pair of cases challenging Obamacare’s rule requiring most employers to offer contraceptive coverage in their employee health insurance plans. While these cases have contraception and women’s rights at their center, they also raise significant issues about corporate influence and changes in our health care system.

Just to review how we got here: Part of President Obama’s 2010 health care reform law requires employers to offer their employees health care that covers contraceptives. The law exempts religious institutions – like churches and synagogues – from this mandate, and accommodates religious non-profits – like universities and hospitals – by letting insurers offer separate contraception coverage directly to their employees. It does not, however, offer any exemption for religious for-profit organizations. The mandate then breaks down like this:

Class of Employer Contraception rule under ACA:
Religious institutions (churches, synagogues, etc.) Not required to provide
Religious non-profits (universities, hospitals, etc.) Not required to provide, but direct provision from insurer to employee
Religious for-profits (Hobby Lobby, other businesses w/ observant ownership) Required to provide

Enter Hobby Lobby and Conestoga Wood, the two companies challenging the contraception rule before the Supreme Court. These companies are not exempt from providing contraceptive coverage to their employees, but they maintain that doing so violates their owners’ closely held religious beliefs. They rely on a 1993 law called the Religious Freedom Restoration Act (or “RFRA”), which forbids the government from substantially burdening a person’s religious beliefs unless it has a compelling reason for doing so.

Therefore, these cases hinge on: (1) whether corporations like Hobby Lobby and Conestoga Wood are “persons” that can assert protected religious beliefs under RFRA; (2) whether the contraception mandate is a substantial burden on the companies’ religious beliefs; and if so, (3) whether the government has a compelling interest in promoting contraceptive coverage, and whether imposing a mandate on employers is the least-intrusive way of promoting this interest.

The core legal arguments over religious freedom and contraceptive rights have been thoroughly dissected elsewhere, so I’d like to focus on other issues underlying these cases: namely, the power of business interests, and the structure of our post-Obamacare health care system.

Corporate Power & Health Care Autonomy

Much of what animates our arguments about these cases is disagreement over how much power corporations ought to have. Mandate opponents draw on the legal doctrine that treats corporations as if they are individual persons to argue that corporations can exercise religious and conscience rights. Corporate personhood doctrine has generally distinguished between the corporation and its owners, and has not (yet) recognized corporate religious beliefs, so the mandate opponents seek to doubly extend rights for businesses.

Mandate supporters resist this notion of corporate rights and freedoms. Many are sensitive to the expansion of corporate rights in the wake of the Supreme Court’s decision in Citizens United, which validated free speech rights for corporations engaged in political spending. To some, the idea that corporations can exercise rights just like natural persons upends the traditional understanding of the corporate form as a neutral vehicle through which employees and employers contract to conduct business. These rights, moreover, come at the expense of corporations having obligations in society by allowing them to opt out of generally applicable legal duties.

Businesses are not wrong to argue that the Supreme Court opened the door for these cases when it reaffirmed corporate speech rights in Citizens United. However, workers are understandably fearful of the outgrowth of corporate power. In an environment of stark economic inequality, where 1% of earners holds over 40% of the country’s wealth, and a marginalized labor movement, employees understandably feel dominated by business interests. Leaving workers at the mercy of ownership’s moral and spiritual beliefs would add one more dimension to this domination.

Decoupling Jobs from Insurance

Are workers right to fear that corporate rights come at the expense of their health care autonomy? Supporters of the contraception mandate argue that employer conscience-based decisions will infringe on their freedom to direct their own health outcomes and lend protection to discriminatory practices by employers. Such a fear is understandable given how long our health care system has been dependent on employer-provided insurance. Employers occupy a quasi-governmental role as health insurance providers of first resort. If corporations have discretion in how they provide health insurance, then workers’ health freedom is implicated.

The companies opposing the mandate, however, argue that there are other ways for their employees to obtain contraceptive insurance. One obvious way is through the centerpiece of Obamacare: the state and federal health insurance marketplaces.

This tension – over whether corporate religious choices impede employees’ freedom of health – is a product of the unique state of our health care system. Obamacare represents the first significant nudge away from employer-sponsored insurance.  The law’s tax credits and marketplaces have breathed life into inoperative individual health insurance markets, meaning employer-sponsored insurance is not “do or die” anymore.  Even Obamacare’s (twice delayed) employer mandate arguably replaces a traditional norm of obligation for employers to provide health insurance with a new ethic where employers can buy out this obligation by paying a fee.

Complete decoupling – as severing the link between our jobs and our health insurance is called – is widely considered to be a great thing, supported by economists and policymakers on both the left and the right. It would create a more dynamic workforce by freeing people to leave jobs without the fear of losing their health insurance. It would also reduce administrative costs from employers, liberated from having to manage costly and time-consuming health plans.

This transformation away from employer-sponsored insurance, however, is new and uncertain, along with being highly incomplete. Because a functioning individual health insurance market is a new phenomenon for most of us, many aren’t yet comfortable completely trusting it; it’s fundamentally different from the employer-based health insurance system they’ve always known. Despite forecasts to the contrary, this shift is also far from complete. Our health insurance system still favors employer-sponsored insurance, most notably by excluding health insurance benefits from taxation. For many, the value of this tax exclusion exceeds the value of Obamacare’s health exchange subsidies, which are means-tested based on an individual’s income. So on net, our system certainly still favors employer-based health insurance.

All of which is to say that the anxiety felt by contraception advocates is real and defensible, flowing from reliance on our traditional employer-based insurance system. But the long-term solution presented by mandate opponents – obtaining health coverage outside the employer’s auspices – is both realistic and desirable.  Realistic because the seeds have been planted by Obamacare, and desirable because it would relieve employers of not just contraceptive coverage decisions, but all health care decisions. This, of course, would (mercifully) render our arguments about contraception and employers’ religious beliefs moot.

The specter of employers empowered to pick and choose which medical treatments comport with their moral code haunts many concerned observers of Hobby Lobby. We can truly solve this problem by reorganizing our health insurance system around something besides our jobs – whether that’s government-provided health insurance, competitive individual marketplaces, or something in between.

 

For more on the Hobby Lobby case, see the DIane Rehm Show’s fantastic panel discussion, and this comprehensive preview from the Washington Post.