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CCHF Health Freedom eNews

July 16, 2014


Will "Halbig" Be Obamacare’s Undoing?

What if Obamacare subsidies disappear? This week a critical decision is expected on Halbig vs. Burwell, formerly titled Halbig vs. Sebelius. The case challenges the IRS for providing millions of dollars in Obamacare subsidies to people in 36 states through the federal exchange,  Waiting in the wings is Pruitt vs. Burwell, a case filed by the Oklahoma Attorney General that also challenges the subsidies. One or both cases could end up in the Supreme Court.


Halbig plaintiffs say the law allows subsidies only through a state exchange. And because the mandate and its penalties are hinged on the existence of Obamacare premium subsidies, actually called Advanced Premium Tax Credits (APTC), Halbig claims harm done. Without subsidies, there's no mandate and no penalties. (see our press release below)


The authors of Obamacare thought they were being clever -- twice. First, they established the state health insurance exchanges with language making it appear as a mandate (Section 1311). Then because the U.S. Constitution prohibits the federal government from "commandeering" a state through such a mandate, they created the federal exchange as a fallback position in a separate section of the law (Section 1321).


They hoped states would accept the mandate, never see Section 1321, and forget the Constitutional prohibition on commandeering. They never intended to build a federal exchange (now called and they gave themselves no money to do so. Thus, as they testified, 30-40% of it is not even built.


(Why are Californians Kvetching? See "News to Know" below)


Second, the authors said federal Obamacare subsidies could only be issued by state-established exchanges. This was a bribe: If governors and state legislators agree to build an exchange with federal dollars and then maintain it with hundreds of millions of state dollars and fees on users, the federal government would agree to give their constituents money to pay the higher cost of Obamacare coverage.


But 36 states saw the trap and refused to build a state exchange. They didn't want to cede state control over health care -- state exchanges are state exchanges in name only. HHS controls everything about them -- and they didn't want to be on the hook for the tens to hundreds of millions of dollars it would take to run the website.


So Obama's IRS took matters into their own hands. They declared an interpretation of the law that was not the plain language of the law. Their final rule made subsidies available from any exchange including "a State Exchange, regional Exchange, subsidiary Exchange, and Federally-facilitated Exchange." As the May 23, 2012 final IRS rule notes:


"Commentators disagreed on whether the language in section 36B(b)(2)(A) limits the availability of the premium tax credit only to taxpayers who enroll in qualified health plans on State Exchanges.

"The statutory language of section 36B and other provisions of the Affordable Care Act support the interpretation that credits are available to taxpayers who obtain coverage through a State Exchange, regional Exchange, subsidiary Exchange, and the Federally-facilitated Exchange. Moreover, the relevant legislative history does not demonstrate that Congress intended to limit the premium tax credit to State Exchanges."  [emphasis added]


Law is not about arbitrary interpretations of language or history. Law is black words on a white page. The court should rule for Halbig plaintiffs using the plain language of the law. They could even acknowledge the Faustian bargain Congress and the administration hoped states would make when Congress limited subsidies to State Exchanges.


Look for sparks to fly no matter how the court rules. The Obama administration has been caught in a clever scheme. This lawsuit could shut down the scheme -- and the law.


Working to make Obamacare a tiny footnote in American history,


Twila Brase, R.N., PHN

President and Co-founder




News to Know:

Will Your Doctor Quit? 

On his blog, Dick Morris recounts a statement made by a physician in the novel Ayn Rand. Americans should consider it today: "I quit when medicine was placed under State control some years ago.  Do you know what it takes to perform a brain operation?  Do you know the kind of skill it demands, and the years of passionate, merciless, excruciating devotion that go to acquire that skill?  That was what I would not place at the disposal of men whose sole qualification to rule me..."

The Vaccine Failure Problem

Despite the drumbeat for childhood vaccines, there's a problem. If you only read the mainstream media you probably don't know about vaccine failures. Health Impact's news editor writes about a shocking case of an 18-month old child who caught pertussis (whooping cough) from a Sacramento hospital employee who was vaccinated for pertussis. He warns that the outbreak of pertussis is becoming a public health crisis: "Clearly, the evidence proves this is a vaccine failure, and not a failure to vaccinate."

Desperate in D.C.

Hundreds of health insurers have sued the District of Columbia over a broad 1% tax imposed to help fund the D.C. Obamacare exchange, calling it  "illegal taking" under the Fifth Amendment. There are several other constitutional challenges to D.C.'s attempt to tax services not sold on the exchange. Because there are not enough paying customers signing up for Obamacare, the city needs more revenue. D.C. has the nation's second highest exchange cost per enrollee at $12,500.

Medicaid Expansion Mess

Daily Signal writer Amy Payne warns that Medicaid needs real reform, not expansion. State Medicaid expansion plans under Obamacare are bad for needy patients and will bust state budgets. She cites Heritage Foundation health expert Nina Owcharenko who also cautions states in a detailed report that they can't be sure that the costs will be as estimated, that promised federal funding will be certain, or that the feds will give them the flexibility needed to customize their programs.

Employees Don't Want Obamacare

The Supreme Court's Hobby Lobby ruling has focused attention on employer-sponsored coverage. Although job-based insurance has been a common practice, that could change. Obamacare requires companies with more than 50 employees to offer more expensive Obamacare-compliant insurance or pay a penalty, which could cost less than paying for coverage. A Morning Consult poll finds most workers are worried that their employers will stop offering insurance and move them to Obamacare exchanges.

Millions Of Baby DNA Stored In Indiana

Indiana is revising its newborn DNA storage policy after a local TV news investigation. Without the knowledge or consent of parents, the state Department of Health has warehoused more than 2.2 million newborn blood samples since 1991 for possible genetic research. Health officials will let the DNA be used for research, unless a parent or a young adult whose DNA is stored objects in writing, putting the onus on the violated to learn about and stop the violation.

BigMouth for Big Data

Open wide! The largest searchable dental database known as BigMouth was created in 2012 with the partially deidentified electronic health records of 1.1 million patients - but without patient consent, as allowed by the HIPAA no-privacy rule. The Journal of the American Medical Informatics Association reports that database includes patients seen at dental school clinics affiliated Harvard University, Tufts University, U of TX- Houston, and UC-San Francisco. All four belong to the Consortium of Oral Health Research and Informatics.

Last Frontier For Employee Benefits?

Large employers see private health insurance exchanges as a future model for employee benefits and as a way to help them avoid the so-called 40% " Cadillac tax," writes Steve Davis of AIS Health. Smaller employers that don't offer health benefits see private exchanges as a way to provide low cost coverage that avoids penalties tied to the employer mandate. A Washington, D.C. restaurant association recently launched its own private exchange geared to restaurant operators.

Can't Afford to Keep Data Safe

Most information technology industry leaders at utilities and other businesses critical to society are not concerned about compliance with cyber security standards that may help defy hackers and other threats to their operations systems. The Ponemon Institute report showed that about a third of company executives are very familiar with the standards, most of which are voluntary, but only a quarter said their organization has sufficient resources to achieve compliance with government and industry standards.

Slashing Costs = Rationing?

A UnitedHealth Group study found a 34% reduction in costs when cancer doctors were paid a lump sum to treat each patient rather than paid for each drug or service separately, Chemotherapy costs actually increased ($21 million rather than the predicted $7.5 million) while other costs like hospitalization went down. UHG wanted to test the theory that when doctors make much of their income from marking up the price of chemo, they use more expensive treatments.

Coverage Versus Care

Three different studies show that at least 8 million people nationwide who were previously uninsured are signed up and now covered under Obamacare, according to the LA Times. Young adults under age 35 accounted for the sharpest increase in coverage. More than half think they are better off with their new coverage. But have they tried to use it? (see next story).  At least 30 million people are expected to be uninsured with Obamacare fully implemented.

"Kvetching" Works

There is little-known loophole in Obamacare that angry Californians recently discovered. Many Covered California exchange enrollees were told they could keep their doctor only to find their doctor is not included in their narrow network of providers. The "qualifying life event" loophole allows people to enroll in health insurance outside of open enrollment for significant life changes. It also allows a change in health plan for "misconduct or misinformation," which thousands of angry Californians have now successfully claimed.

Quote of the Week:

"[Nurses] witness first-hand the serious problems and unanticipated risks that patients are subjected to as electronic health records and computerized decision support systems are rolled out in our hospitals with too little training, testing or safeguards and even less thought to the potentially catastrophic consequences for patients of system errors and outright failures." - RoseAnn DeMoro, Executive Director of National Nurses United in a letter addressing FDA's health IT regulation framework, July 8, 2014.  




Stat of the Week:

$10.58 - monthly premium after federal subsidies for Teresa Mashburn, a 51-year-old from Goldston, N.C. who was uninsured for 10 years. (Politico Pro, July 14, 2014)


News Release of the Week:

Impending Court Decision Could Dismantle Obamacare

ST. PAUL, Minn. - Another landmark court decision in a case that challenges the Affordable Care Act (ACA) is expected anytime, and the outcome could have far-reaching effects for those receiving Obamacare subsidies for their government health care coverage.

The U.S. Court of Appeals for the D.C. Circuit is expected to rule any day in Halbig vs. Burwell, formerly Halbig vs. Sebelius, which calls on the carpet a May 2012 Internal Revenue Service rule that allows subsidies to be offered through the federal exchange. 
Continue reading


Featured Health Freedom Minute:

Are Doctors or Data Profiteers Right on EHRs?

Congress, the FDA, industry groups and researchers agree that
computerized medical records need little federal regulation. But public
comments from physician and nursing groups say there are serious
patient safety issues that need to be addressed.

Continue reading

Twila Brase broadcasts a daily, 60-second radio feature, Health Freedom Minute, which brings health care issues to light for the American public. Health Freedom Minute airs on the entire American Family Radio Network, with more than 150 stations nationwide in addition to Bott Radio Network with over 80 stations nationwide.

Click here to listen to this week's features.


Citizens' Council for Health Freedom
161 St. Anthony Avenue, Ste 923
St. Paul, MN 55103
Phone: 651.646.8935 • Fax: 651.646.0100

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