William Playfair, Inventer of Charts
Ladies and gentlemen, I present to you history’s first bar chart, as invented and published in 1786 by Mr. William Playfair of Scotland. Obviously it’s hard to make out the details here, but it shows Scottish imports and exports for the year 1781.
Playfair also invented the line graph and the pie chart. That’s a pretty impressive resumè of contributions to humanity for which Mr. Playfair, it seems to me, has been seriously under-appreciated by history. Nor indeed was he recognized with proper gratitude while living, if this (totally unverified) clip from his 1824 obituary is accurate:
In private life Mr. Playfair was inoffensive and amiable; not prepossessing in his appearance and address, but with a strong and decided physiognomy, like that of his late brother. With a thoughtlessness that is too frequently allied to genius, he neglected to secure that provision for his family, which, from his talents, they were justified to expect; and although he laboured ardently and abundantly for his country, yet he found it ungrateful, and was left in age and infirmity to regret that he had neglected his own interests to promote those of the public.
The obit further explains that “Unhappily, however, for his own interests, he had the ambition to become an author.” He wrote a lot, mostly about politics and political economy. Nowadays we have a word for people like William Playfair, people who like to write, especially about politics and policy, often without compensation, and who love charts: bloggers.
Conspirators and Windmills
Eric Posner responds to comments from readers of the Volokh Conspiracy:
If nothing else, I want to convince you that arguing that we should return to the original Madisonian design is tilting at windmills—and will enjoy no more success than arguments that we should live in a night watchman state, return to the gold standard, create an agrarian republic, abolish private property, or set up a benevolent world government. All of these arguments are on the fringes—not because they violate the rules of logic but because they have no constituency—and that is where the Madisonian argument belongs as well.
I don’t know what to say to people who continue to insist that because executive primacy violates the (original) Constitution, something must be done about it. Arguing that our current system of government is unconstitutional is like arguing that the original Constitution was unconstitutional because it violated the amendment procedures of the Articles of Confederation. It is a logical argument that makes no difference in the real world because ultimately what matters is popular sentiment, and popular sentiment has acquiesced in constitutional change without regard to the rules established to control it.
Well put. The point there is about executive primacy but clearly also applies to constitutional originalism in other contexts. In the Commerce Clause arena, the major legal context around the individual mandate debate, I think you see a little more pull towards originalist thinking precisely because there is a constituency for opposing federal regulation of big business—namely, big business.
And I think it’s mostly a good thing that there is real power behind the constitutional abstractions that limit the scope of the government’s power. One side effect, though, is that people may take the dressed-up theoretical justifications for those limits a little too seriously. Originalism is, logically, a very powerful theory of constitutional meaning. But practically, it is mostly a fig leaf.
Compromise Is Not Impossible
It occurs to me that portions of my last post could be construed to mean that political compromise is not possible. Clearly, a statement to that effect would be false. Which presents me with an opportunity to say something I’ve always wanted to say, mimicking a classic maneuver occasionally pulled by the Supreme Court:
Though we (I) do not believe that such a construction represents the best and most faithful interpretation of our (my) previous statements, to the extent that they may be so construed, they are hereby expressly overruled.
The ACA Turns One
The good news is that it’s the Affordable Care Act’s first birthday. The bad news is that the ACA is sick and unloved, and its long-term prognosis is grim.
Nobody ever thought the ACA was perfect, and health reformers have by and large defended it on the grounds that it was a good start towards tackling the real problems in our healthcare system. Once the political storm surrounding the legislation subsided, the thinking went, we would be able to get down to the real, technocratic work of crafting evidence-based reforms that addressed the underlying crisis of escalating costs. As Don Taylor has written, we were “obviously wrong about that, and politically, the ACA remains toxic.”
Taylor has thought hard about how we might forge a compromise between the parties: by trading the individual mandate for universal catastrophic coverage, reforming medical malpractice, ending the preferential tax treatment for employer-provided insurance, and so forth. It’s an interesting package, worthy of discussion.
The problem, as I see it, is that the political goal posts aren’t fixed, and can’t be. By the next time a majority party is seriously ready to embark on major reforms, it will have galvanized support for an agenda, however vague. And when it moves to enact that agenda, even if based on terms to which the minority would have been amenable in previous years, the new minority won’t be amenable to those terms. Because those terms will be the ones they now define themselves against. Nor will a new compromise be forthcoming, because the new majority (or a considerable portion of the new majority) will have defined failure in the very terms that would constitute that compromise.
Maybe a different dynamic will emerge if Obama wins a second term alongside big GOP majorities in Congress. That might create a window more favorable to compromise. Maybe. But in the meantime? And afterwards? In my view it is becoming increasingly necessary to pursue structural political reforms that reduce the importance of compromise—or, rather, reforms that reward policy performance over compromise for its own sake. Compromise is desirable, but only when it is the result of two parties with definite interests negotiating their way to a mutually acceptable middle ground. If you make compromise a goal in itself, and you negotiate on the shifting sands of politics, you have a recipe for failure.
There are lots of hard problems in health policy. There’s information asymmetry, perverse incentives, overutilization/underutilization, and so on. In spite of all that, I would be optimistic about our prospects over the long haul, were it not for structural defects in our political system. Perhaps the most noteworthy of these defects is the filibuster—i.e., the 60-vote supermajority requirement for action in the U.S. Senate. The filibuster is not the only structural problem in American politics, nor perhaps even the worst. But it is one of the most egregious. In theory the filibuster’s supermajoritarian regime promotes consensus, ensuring all voices are heard and anchoring public policy in the political center. But in practice, in the new era of party discipline, it gives the partisan political minority the weapons it needs to hold fast to its own policy preferences and refuse cooperative engagement with the majority.
Electoral politics is zero sum, so it’s often going to be in the political minority’s rational self-interest to thwart consensus rather than compromise on big-ticket items. And there’s nothing wrong with that, except that as long as our central governing institution is so thoroughly constrained by the consent of the political minority, there is little chance for major, bipartisan legislative action on polarizing issues like health care. So it’s not “wrong,” it’s just a crippling cancer at the heart of the republic.
It might seem that supermajority rules make the ACA safer since it’s that much harder to repeal. And in a narrow sense that’s obviously true. But in a broader sense, as I mentioned up top, the ACA itself is just the groundwork for a larger project of health reform. If further legislative action is foreclosed because conservatives continue to reject the framework altogether, we’re sunk. Without Republican buy-in, the larger project of health reform is doomed.
So happy birthday, ACA. You might not survive to see many more of them.
Dual Eligibles, with Charts
Lester Feder, out from behind the curtain of Politico Pro, commits a blatant act of policy journalism in a piece about what may or may not be wishful thinking by the Administration, which is hoping to find ways to reduce the costs of caring for Medicare-Medicaid dual eligibles through better coordination of care and financing.
They are among the patients with the severest need for care and the fewest resources to get it. [...]
Caring for these individuals is complicated by the fact that Medicare and Medicaid don’t always interact well with one another. Medicare — the federally funded program for seniors and some younger people with disabilities — is the primary insurer for dual eligibles. Medicaid — the joint federal/state program that covers many low-income Americans with disabilities — fills in its gaps in coverage.
And the gaps in Medicare coverage for dual eligibles are big. So big that the costs of Medicaid’s gap-filling coverage are greater than the costs of the Medicare coverage itself:
Feder again:
The two programs, said Barbara Lyons, director of the Kaiser Commission for Medicaid and the Uninsured, “have different policies, and those policies don’t line up very well.”
To illustrate her point, she suggested imagining you’re a patient with multiple chronic conditions who lands in the hospital. Medicare will pick up the tab once you’re admitted. But after you’re discharged, neither program covers the intensive follow-up care required to keep you healthy. So you deteriorate, and after another Medicare-financed hospital stay, you wind up in a nursing home, which is covered for a limited period by Medicare and then indefinitely by Medicaid.
This fractured financing is obviously a tragedy for the beneficiary’s health. Gaps in care can result in an individual who could have had many more years at home being confined to an institution for life. But it also is a disaster for the health care financing system. Public programs are paying for an extra hospitalization plus nursing home care that could have been avoided through better care after the initial discharge.
“If you could better coordinate care,” Lyons said, “you could decrease some unnecessary hospitalization and potentially some long-term-care costs.”
I don’t have any valuable analysis to add, but here’s another chart from KFF that illustrates the most dramatic fact about Medicaid spending on its highest cost enrollees: that 5% of enrollees account for about 54% of program spending:
Some but not all of that 5% are dual eligibles. The dual eligibles themselves make up about 15% of Medicaid enrollees and account for about 40% of costs, as shown in the first chart above.
Read the rest of Lester’s piece. H/t Austin Frakt.
The Not-So-Long Road to October
Federal Courts of Appeals have begun scheduling hearings on the various ACA lawsuits, and the schedules they’re adopting are pretty aggressive. Brad Joondeph writes that the Supreme Court is likely to hear the case in its October 2011 term, which means we could have a decision well in advance of the 2012 election.
Of course, it’s also possible that things will drag on. There are a number of ways the Court could delay matters, if it were so inclined.
My First Stata Lesson
- The blue dots represent meaningless blue dots from my first Stata lesson.
- The red line represents the places on the graph where those meaningless blue dots should be and where they would be if they would only behave like proper meaningless blue dots should behave.
- Conclusion: this is going to be awesome when I understand what all those little letters and things mean.
Legislative History on the Tax Issue, A Compilation of Selected Sources
In my last post I discussed the role of legislative history in the legal argument over whether the penalty for failure to comply with the ACA’s individual mandate is a tax. I’ve been doing some digging, and I’ve compiled excerpts from some of the relevant materials here, in three categories: (A) early drafts and committee bills, (B) the Senate Finance Committee debate transcripts, and (C) floor debate from the Congressional Record.
The basic story these sources tell is this: Early drafts of health-reform legislation plainly and directly called the penalty a tax. The Senate HELP bill was the only exception. Lawmakers on both sides openly discussed the penalty as a tax, with a few instances of Democrats being a little cagey. Then Harry Reid unveiled his merged Senate bill, the Patient Protection and Affordable Care Act (pdf, as passed), which dropped the “tax” label entirely even as it preserved all the functional mechanics of the earlier bills’ mandates. The change of label does not seem to have registered in the public debate or affected the politics or rhetoric very much on either side, if at all. (My research has not been exhaustive.)
A. Early Drafts and Committee Bills
- H.R. 3200 (pdf), Early House bill (introduced July 14, 2009)
Sec. 401, “Tax on Individuals without Acceptable Health Care Coverage” would have amended Internal Revenue Code (IRC) with a new Sec. 59B:
(a) TAX IMPOSED.—In the case of any individual who does not meet the requirements of subsection (d) at any time during the taxable year, there is hereby imposed a tax equal to 2.5 percent of the excess of—
- H.R. 3962 (pdf), House bill (introduced Oct. 29, 2009, passed Nov. 7, 2009)
Sec. 501, “Tax on Individuals without Acceptable Health Care Coverage” (same as § 401 of H.R. 3200) would have amended IRC with new Sec. 59B:
(a) TAX IMPOSED.—In the case of any individual who does not meet the requirements of subsection (d) at any time during the taxable year, there is hereby imposed a tax equal to 2.5 percent of the excess of—
- S.1679 (pdf), Senate HELP bill (introduced Sept. 17, 2009)
Sec. 161 institutes “shared responsibility payments.” For individuals without qualifying coverage, “there is hereby imposed for the taxable year…an amount” to be specified by HHS. Not a penalty or a tax, but “an amount.” The HELP bill is the least forthright of all the pre-PPACA bills on this question. However, it goes on to specify that “The amount imposed by this section shall not be treated as a tax” for certain purposes, but “shall be treated as if it were a tax” for certain other purposes. One might quibble with the “as if it were a tax,” but this is consistent with an understanding that the payments would be a proper exercise of the taxing power. If Congress expressed its intent that something be a tax for at least one purpose, any argument that it did not intend to exercise its taxing power is foreclosed.
- Senate Finance Chairman’s Mark (pdf), Baucus draft (introduced Sept. 22, 2009)
Excise Tax. The consequence for not maintaining insurance would be an excise tax. If a taxpayer’s MAGI is between 100-300 percent of FPL, the excise tax for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or an individual claimed as a dependent) is $750 per year. However, the maximum penalty for the taxpayer unit is $1,500. If a taxpayer’s MAGI is above 300 percent of FPL the penalty for failing to obtain coverage for an individual in a taxpayer unit (either as a taxpayer or as an individual claimed as a dependent) is $950 year. However, the maximum penalty amount a family above 300 percent of FPL would pay is $3,800.
- S.1796 (pdf), Baucus bill (introduced Nov. 19, 2009)
Sec. 1301. EXCISE TAX ON INDIVIDUALS WITHOUT ESSENTIAL HEALTH BENEFITS COVERAGE
[...]
(b) IMPOSITION OF TAX.— ‘‘(1) IN GENERAL.—If an applicable individual fails to meet the requirement of subsection (a) for 1 or more months during any calendar year beginning after 2013, then, except as provided in subsection (d), there is hereby imposed a tax with respect to the individual in the amount determined under subsection (c).
Both H.R. 3200 and H.R. 3962 specified that the mandate penalty would not be treated as a tax for certain purposes (namely, calculating tax credits). The fair implication of this proviso—following a canon of statutory construction known by the Latin Expressio Unius—is that the penalty would be treated as a tax for other purposes.
B. Senate Finance Committee Debate
On Sept. 22, 2009 the Senate Finance Committee began a series of executive sessions on health reform for the purpose of debating and marking up Sen. Max Baucus’s “Chairman’s Mark,” an outline of what would later become “the Baucus bill,” S.1796 (pdf). Here, with my notes, are relevant excerpts from the transcript of that day’s session. In [brackets] are page numbers to the pdf of the transcript.
[32] Sen. Hatch says mandate penalties raise $20 billion in new taxes, are “a new tax on middle-class families.”
[57] Sen. Bunning mocks the President’s and other Democrats’ attempts to finesse their way around calling the mandate penalty a “tax”:
And I was stunned when I heard the President say this past weekend that the individual mandate, which is an amendment to the Tax Code and is specifically called an excise tax in the Chairman’s mark, is not really a tax. Perhaps we should change the name of the Tax Code to “A Shared Responsibility Code” so we are not really imposing taxes on the American people.
[72] Sen. Crapo remarks that “it is pretty clear . . . that the consequences for not maintaining insurance would be an excise tax.”
I noted that this weekend there was quite a bit of talk in the news shows about whether or not this proposal even contains a tax or not. I think that it is pretty clear–the proposal itself states that the consequences for not maintaining insurance would be an excise tax and makes it clear that the excise tax would be assessed through the Tax Code and apply it [sic] as an additional amount of Federal tax owed. Yet the President is saying that there is no new tax in the bill, that his pledge to avoid increasing taxes for those who make under $250,000 is honored. Yet last year, in September, he indicated that under his plan no family making less than $250,000 a year will see any form of a tax increase, not your income tax, not your payroll tax, not your capital gains taxes, not any of your taxes. And yet we see this major new proposal for more taxes before us now.
[196-97] Sen. Grassley has an exchange with Mr. Barthold, Chief of Staff of the Joint Committee on Taxation:
Senator Grassley. [. . .] So Mr. Barthold, is the penalty here not an excise tax, and will it not affect people making under $250,000 a year?
Mr. Barthold. Senator Grassley, the penalty proposed in the Chairman’s mark is, as you observed,structured as a penalty excise tax. We have other penalty excise taxes in the Internal Revenue Code. We have not separately analyzed. We have worked in conjunction with Dr. Elmendorf and his colleagues at the Congressional Budget Office in terms of the overall effects of what sort of people might purchase insurance through the exchange who would not have insurance provided by their employer, and where the individual mandate or the employer free rider penalty would arise.
We have not done a combined distribution analysis across income to specifically answer your question, but to the extent that, yes, we think that some people would be subject to the penalty excise tax when everything shakes out, we would expect that some would have incomes less than $200,000.
[197-98] Sen. Baucus then jumps in and tries to distinguish the penalty from a tax, saying that IRS collection is only incidental, and that HHS or some other agency could collect the mandate penalty.
Let me just say on that point, it is an interesting question. This is really a penalty that is being collected by the Internal Revenue Service. It could be collected by another body, another entity,another agency, perhaps HHS.
The modification, too, will reduce the penalty significantly, will cut it in half, so it is much smaller than it otherwise was. But somebody is going to have to collect it to the degree that there is one, and it is this committee’s determination–at least it is my determination so far–that the better, more efficient is for the IRS, which is set up to collect these kinds of penalties. So it is really a penalty that we are talking about here, just the IRS, not HHS, is collecting the penalty.
Sen. Baucus’s remark there is the only clear instance I’ve found of a Congressional Democrat denying (or flirting with denying) that the mandate penalty is a tax. But of course, Baucus’s Chairman’s Mark and subsequent bill (see S.1796 [pdf]) are unmistakably clear that the penalty is a tax. (See the excerpts from those draft bills above.)
[303-] Sen. Hatch in another exchange with Mr. Barthold and Mr. Reeder, Senior Benefits Counsel on the Democratic Senate Finance Committee staff:
Senator Hatch. Let us go further. While we are on the topic of upholding the Constitution, the -– legislation would require all U.S. citizens and legal residents to purchase a certain level of health insurance coverage.
They must record qualified coverage on the federal income tax return. Failure to do so would result in an excise tax of $750 on individuals applied as an additional amount of federal tax owed. Would that be a direct tax?
Mr. Barthold. If we applied an excise tax on all individuals –-
Senator Hatch. But you are not. I am told that this would be the first time in our history that Americans would be faced with the situation where they were ordered to do some specific act by the federal government which if they refuse to do it they would be subject to a tax. Is that correct?
Mr. Barthold. I do not know, Senator.
Senator Hatch. I think it is.
Mr. Reeder. If I could jump in here and just add that the code, the Internal Revenue code is replete with excise taxes that are applied as penalties. [typos in transcription, corrected here –JH]
Senator Hatch. Well, this is on a person, not a service or product.
Mr. Reeder. There are lots of excised taxes that are applied to an individual.
Senator Hatch. I guess I’m asking do you believe this individual mandate raises possible Constitutional issues as I have been told? It sure seems like it to me.
Mr. Barthold. Senator, it is just not something that I am qualified to answer. An excise tax applied on activities by all individuals would not seem to be beyond the flush of the Constitution’s authority for the Congress to assess a tax. But I am not the right person to engage in a Constitutional discussion. I’m sorry.
Senator Hatch. It would be a tax on a person for doing absolutely nothing. I mean, can anyone on the panel say whether the mandate of excise tax would be constitutional? Anybody?
The Chairman. Well, I will. This is an equally applied penalty for all persons meeting a certain category. I think it is a stretch to say this is unconstitutional. I will take that argument any day that it is not constitutional. It is constitutional.
Mr. Reeder. We did refer this to CRS and we got guidance from them that it is.
Senator Hatch. To be honest with you, I do not think it is at all. Let me move on. [...] According to the Chairman’s mark, the individuals who failed to maintain health insurance are subject to an excise tax, right?
Mr. Barthold. It is the penalty, excise tax penalty.
Senator Hatch. The penalty for excise tax. The excise tax would be assessed with a tax code and applied as an additional amount of federal tax owed. However, there are various rules protecting those who are uninsured for less than three months or to the extent that the cost of the health insurance premium exceeds 10 percent of adjusted gross income. Are there any excise taxes in the current tax system that are treated this way? And are there any other excise taxes that vary based on the taxpayer’s income? Are there any other taxes at all in our current tax system that are furthered by the failure of the taxpayer to take some action?
Mr. Barthold. Well, as Mr. Reeder noted, there are some penalty excise taxes that apply to individuals for either actions that they take or in some instances for not having taken an appropriate action.
We have penalty excise taxes on excess distributions or premature distributions from qualified retirement plans. There is excise taxes in the tax exempt organization area for, I guess for lack of a better term, for inappropriate activities or decisions made by management of the tax exempt order.Senator Hatch. But are they based on the taxpayer’s income?
Mr. Barthold. None of those are based on taxpayer’s income. The excise taxes on the distribution indirectly are based on income in the penalty taxes for early withdrawals for example key off of the size of the withdrawal.
Sen. Hatch then confuses the mandate penalty “excise tax” with the mark’s other excise tax, the “Cadillac tax” on high-cost plans.
[329] And later:
Senator Hatch. I have a few [questions] now. The CRS report concludes the government can require individuals to obtain health insurance and penalize you if you do not. However, the penalty must be something the government has already given you and can take away, such as the right to a deduction. Now, this is an excise tax imposed on you, regardless of if you have a tax liability or not. I think the CRS has not analyzed the Chairman’s proposal.
And at [352], Hatch refers to his amendment to strike “the new individual mandate tax proposed in this bill.”
Other relevant discussions occurred on subsequent days of the Committee markup. Democrats more or less dodged the debate, and Republicans showed no sign of straying from their normal m.o. in which things that are bad and things that are taxes are conceptually indistinguishable, more or less.
On October 1, Sen. Hatch presents a much more polished constitutional argument and directly challenges the proposition that the penalty qualifies as an “excise tax” as it was described in the Chairman’s Mark. If it is a tax at all, Hatch contends, it must be a “direct tax”:
The second constitutional problem with the individual mandate arises because the penalty for failing to purchase health insurance is, in fact, not the excise tax that the Chairman’s mark calls it. An excise tax is a tax on the manufacturer and sales of goods or services. The gasoline tax would be a good example. The tax imposed upon people who failed to purchase health insurance, however, is the exact opposite. It occurs not when there has been the sale of something, but when there has been no sale of anything at all.
This actually works more like a fine, but the Chairman’s mark said it is an excise tax to be assessed through the Tax Code and collected by the IRS. If this is a tax at all, it is certainly not an excise tax. Instead, it is a direct tax. And while the Constitution requires that excise taxes must be uniform throughout the United States, it requires that direct taxes must be apportioned among the States by population.
Now, just as the excise tax on high-premium plans is not uniform, this direct tax on individuals who do not purchase health insurance is not apportioned. In an analysis just published in the well-respected B&A Daily Tax Report, they looked at this question. I would ask, Mr. Chairman, consent that this be placed in the record at this point.
Sen. Hatch had by this point developed the argument into a fairly sophisticated analysis. It’s just not clear that any other Senators were on board with that analysis. I haven’t found any instances of other Senators picking up the argument, or responding to it specifically. But, as shown below, it is clear that Democrats did not abandon the taxing-power justification of the mandate, and they continued to cite that authority right through the passage and enactment of PPACA.
C. Congressional Record, Floor Speeches
- Rep. George Miller (D-Cal.), 156 Cong. Rec. H1854, H1882 [pdf] (Mar. 21, 2010):
The bill contains an individual mandate to either obtain health insurance or pay a penalty. This provision is grounded in Congress’s taxing power but is also necessary and proper—indeed, a critical linchpin—to the overall effort to reform the health care market and bring associated costs under control throughout interstate commerce.
- Sen. Ensign (R-Nev.), 155 Cong. Rec. S13830 (Dec. 23, 2009):
In this case, if you choose to not do something — in other words, if you do not choose health insurance — this bill will actually tax you. It will act as an onerous tax.
Via Ezra Klein. I discussed the significance of this episode here.
- Sen. Leahy (D-Vt.), 155 Cong. Rec. S13751, S13753 [pdf] (Dec. 22, 2009):Sen. Leahy argues in favor of PPACA, remarks on constitutionality under both commerce power and tax power, citing noted constitutional law scholar Erwin Chemerinsky’s op-ed in the L.A. Times (from Oct. 6, 2009). Note that Chemerinsky’s piece was written and published long before Sen. Reid’s merged bill appeared, so it wouldn’t be properly taken as an opinion about the constitutionality of the actual language of PPACA. But Leahy’s reference counts as another instance of how the Reid bill’s removal of the tax label had no discernible effect on Congressional debate or Members’ talking points.
- Sen. Max Baucus (D-Mont.) 155 Cong. Rec. S13558, S13581-82 [pdf] (Dec. 20, 2009):Sen. Baucus stated his belief that there is “ample authority for Congress to enact such a provision under the Commerce Clause, and also under the congressional authority to tax and spend for the general welfare provided for in the Constitution,” and he submitted an article by Mark Hall, law professor at Wake Forest Univ, for the record.
Conclusion
If you were one of the litigators challenging the individual mandate in court, you would want to find instances of Democrats arguing, in an official forum, that the mandate/penalty is not a tax. I’m not aware that any exist. There’s President Obama’s noted Sept. 20, 2009 interview with George Stephanapoulos, which Judge Vinson cites in his October ruling (pdf). What the President meant by his statement that “the responsibility to get health insurance is absolutely not a tax increase” is arguable. I tend to think he meant the mandate itself is not a tax—not that the penalty isn’t. But then again, I doubt he was really drawing that distinction, so I concede that the other interpretation is fair. In any case, it would be exceedingly strange if an interview with George Stephanopoulos were regarded as a proper source of legislative history.
Other than that, there’s Sen. Baucus’s cagey remark from the Sept. 22 transcript (above). And that’s all I’ve found so far. I’ll update this post if I come across anything worthy of note.
The Uses of Legislative History
Ezra Klein revisits the Senate’s Dec. 23, 2009 vote on a constitutional point of order raised by Sen. John Ensign (R-Nev.) against the ACA’s individual mandate. The point of order was defeated by a party-line vote of 60-39, but the interesting thing about it, says Ezra, is that every Senate Republican (minus one absentee) implicitly endorsed Ensign’s description of the individual mandate as a tax, “an onerous tax,” on those who choose not to get health insurance. That’s interesting because a key argument of the mandate’s constitutional challengers is that the penalty for failing to maintain minimum coverage is not a tax—that is, not an exercise of the taxing power of Article I, Section 8 and the 16th Amendment. Notably, 32 of the very same Republican Senators who voted for the Ensign point of order later filed an amicus brief (pdf) against the constitutionality of the individual mandate (though, to their credit, they did not explicitly argue that the penalty is not a tax).
Now, as Ezra recognizes, this episode is not going to dispose of the issue in court. For one thing, its significance is not unambiguous. The purpose of the vote was to declare the mandate unconstitutional, not to declare it a tax. And if the purpose had been to declare it a tax, the whole basis of the constitutional point of order would have been transparently self-defeating. But also, if you take the 39 Republican votes as an endorsement of the proposition that the penalty is a tax, shouldn’t you then count the 60 Democrats’ votes as a rejection of that proposition?
Legislative history is tricky terrain, and the notion that there is something called the “intent of Congress” that may be reconstructed from legislative history is dubious at best. Trolling through the Congressional Record is not going to tell us definitively whether Congress intended to exercise its taxing authority or not.
But there are uses for legislative history. It can give us—or a judge—a sense of the range of fair readings of statutory language; not whether a certain interpretation is right or wrong, but whether it is fair. It can give us a sense of whether the meaning of a given provision was widely agreed upon or in dispute, or whether it was contemplated at all. In other words, legislative history can serve as a source of second-order facts about how legislators understood the legislation in question. And those second-order facts can be useful, not because they reveal the true intent of Congress, but because they can help us measure the relative strength of competing inferences about legislative intent.
In rejecting the Administration’s contention that the penalty is an exercise of the taxing power, Judge Vinson’s October ruling (pdf) in the Florida case emphasized that the ACA in its final form refers to penalties, not taxes, in describing the monetary assessments imposed for failure to comply with the individual mandate, whereas the House bill and various Committee bills referred to those assessments as taxes. For Judge Vinson, the change of label from “tax” to “penalty” marked a clean break between the ACA’s mandate provisions and the mandate provisions of earlier bills, making it “manifestly clear” that Congress intended not to exercise its tax power. And by that description, the legislative history does seem to offer compelling support for the inference that Congress did not intend to act under its taxing power.
But measured against evidence like Sen. Ensign’s remarks on Dec. 23 and the floor speeches of Democratic Senators who continued to justify the mandate as an exercise of the taxing power, that inference does not look as strong. And by contrast, when you note the fact that the basic mechanism of the penalty—assessed and collected by the IRS through income-tax forms—did not change or vary significantly among the many health-reform bills considered in the run-up to PPACA’s enactment, and that lawmakers consistently referred to the penalty as a tax throughout the process, the inference of intent to exercise the taxing power looks comparatively strong.
And so, the way I see it, even if episodes like the one Ezra dug up can’t establish that the penalty is a tax, they can blunt the force of inferences to the contrary. Maybe Senate Democrats should take up that argument in an amicus brief of their own.
Make Medicaid Better
I am by no means equipped to referee Avik Roy’s challenge to the methodology behind the studies Austin Frakt reviewed in his series, Medicaid-IV. Basically the studies compare health outcomes for people with public insurance (Medicare or Medicaid), private insurance, or no insurance at all. The findings, Austin concludes, generally support the non-shocking proposition that Medicaid improves health—it is better for your health than being uninsured, though not as good for your health as being privately insured.
Roy takes issue with the IV studies (“IV” stands for “instrumental variables.” See here.) on various grounds and dismisses their results, pointing to a University of Virginia study that purportedly contradicts them. I think everyone agrees that the UVa study Roy cites shows dismayingly poor outcomes for Medicaid patients, outcomes even worse than those for the uninsured. But Roy wants to parlay these results into an argument that Medicaid is actually harmful—that Medicaid actually causes harm and makes people sicker than they’d be without any insurance at all.
But that conclusion is not merited if the data is tainted by selection bias. Austin writes:
Medicaid enrollment or being uninsured is not random. Worse, some of the factors that affect self-selection into Medicaid or uninsured status also affect (health and non-health) outcomes. This is a source of selection bias. For example, if sicker individuals are more motivated to enroll in Medicaid we will find that Medicaid is correlated with worse health outcomes. But that’s a selection effect, not an effect of Medicaid.
And because you can’t (ethically) randomize who enrolls in Medicaid and who remains uninsured, you must resort to clever techniques like instrumental variables, which effectively achieve retroactive randomization.
I don’t fully understand all the technical issues here, but I understand even less the conclusions Roy would have us draw. Roy complains that “very few people on the Left were willing to take on the challenging task of exploring why Medicaid patients fare worse than the uninsured, and how we might make Medicaid better.” But his own solution doesn’t seem aimed at making Medicaid better so much as dismantling it and replacing it with direct cash or vouchers.
Those are not unreasonable ideas to advocate for, and I can appreciate that Roy would like everyone to achieve the improved health outcomes associated with private insurance coverage. But it does strike me as unreasonable to think that voucherizing Medicaid is necessarily the right solution, whatever the problem. Roy says, “It’s Medicaid that restricts access to the best hospitals and the best doctors and the best treatments.” But that could just as well be an argument for raising Medicaid’s reimbursement rates to private-insurance (or Medicare) levels. He also thinks that “welfare dependency” and “social disrepair” are part of the problem. But if those things are factors in poor health outcomes in Medicaid, why shouldn’t we expect them to have a similar effect on outcomes in Voucher-caid?
So, even if all the relevant studies showed what Roy thinks they show, that Medicaid is more harmful than helpful, it would not be obvious whether the explanation should be sought on the provider side or the patient side or both. But surely it would be irresponsible in any case to set about dismantling Medicaid without identifying to a reasonable degree of confidence why its outcomes are bad. The responsible thing to do would be to take obvious action likely to improve the program—say, increasing provider reimbursements to Medicare levels—and to make a dedicated effort to study Medicaid quality issues more closely. Conscientious policymakers would pursue those objectives in any case, because they are prudent things to do.
Interestingly enough, if one scrolls through one’s PDF of the Patient Protection and Affordable Care Act, one finds: § 1202, which raises Medicaid payments to primary care physicians to Medicare levels, at least in 2013-2014;1 § 2701, which establishes a Medicaid Quality Measurement program for adults (one already exists for children), and § 2801, which enhances the quality assessment capabilities of MACPAC (the Medicaid and CHIP Payment and Access Commission).
Maybe those measures will be ineffectual. But surely the thing to do is to try to make current policy better, even as we study and debate how to make future policy best.
- The provision is codified at 42 U.S.C. §1396a(a)(13)(C). The amended portion of the Social Security Act is here: § 1902(a)(13)(C). I don’t know why it only raises reimbursement for those 2 years. [↩]
The Unbuttered Slide to Broccoli Mandates
When Austin Frakt comes to a slippery slope, he levels it:
[T]he slippery slope has relevance only in instances for which it isn’t necessary. The government isn’t holding back from mandating broccoli consumption because there is no legislative precedent regulating an “inactivity.” It’s held back because there’s simply no incentive to mandate broccoli eating. If there were, Congress would have already considered it, or ought to. In that case, one need not appeal to a slippery slope, though one certainly could. That is, it’s superfluous.
If passage of broccoli and insurance mandates did relate, the relationship would not be a causal one.
It’s always good to work these things out, and it’s better to know why a particular form of argument is fallacious than just to know that it is fallacious. But I’d just like to make this plain: the slippery slope is an argument fallacy. You should avoid it.
I don’t think Austin’s takedown of the slippery slope is specifically directed at the legal arguments against the individual mandate, but he cites this Andrew Koppelman article, which definitely does attack the legal arguments on those grounds, and with gusto. (Koppelman also posted the slippery-slope portion of his paper at Balkinization.) Koppelman’s point, and Austin’s, boils down to this: Congress won’t mandate broccoli consumption because there’s no need to, and if there were a need, it wouldn’t be the result of the need for the individual mandate. The individual mandate does not in fact make a broccoli mandate more likely, so: no slippery slope.
But I don’t think this is the best way to understand the legal argument the mandate’s challengers are making by raising the hypothetical broccoli mandate. That argument isn’t really a slippery-slope argument at all, although it obviously resembles one (especially when deployed as political rhetoric). The giveaway is captured by Austin’s own observation that “the relationship would not be a causal one.” The heart of the slippery slope is an unsupported prediction that decision A will cause an increase in the likelihood of event B. But the challengers aren’t literally arguing that a broccoli mandate or any other purchase mandate will be made more likely if Congress is allowed to regulate “inactivity.” They are trying to illustrate through hypotheticals what they believe would be flaws in Commerce Clause doctrine were it interpreted to allow the mandate. In other words, they are testing the logical implications of doctrine through the use of analogy.
Argument by analogy is probably the most common form of legal reasoning, though it most often proceeds by analogy to established precedents than by analogy to hypothetical future acts of Congress. In his book, Legal Reasoning and Political Conflict, Cass Sunstein writes: ”American constitutional law is often constructed from analogies—not from text or history, not from moral theory, and not from existing social consensus. Constitutional law is a form of casuistry.” (By “casuistry,” Sunstein means case-by-case decision-making.) But where caselaw does not supply the analogies needed to explore the key issues in a case, they must be explored in hypotheticals. Hence, as Yglesias dubbed it, the dread broccoli mandate.
The real danger here is closer to the criticism Andrew Sabl has made—that the broccoli argument begs the question by assuming a broccoli mandate would be unconstitutional. Consider:
- If the individual mandate is constitutional, then a broccoli mandate is constitutional.
- A broccoli mandate is unconstitutional.
- Therefore, the individual mandate is unconstitutional.
In a sense, a lot of the commentary about slippery slopes amounts to an objection to the first premise here. That’s what all the “healthcare is different/unique” talk is about. If healthcare is different enough, the circumstances may be such as to justify an individual mandate for health insurance but not to justify a mandate to buy or consume broccoli. Then again, maybe circumstances could justify a broccoli mandate, too—if you’re creative enough, you can always construct a hypothetical scenario to fit the bill. In that case, you might grant Premise (1), but why should you grant Premise (2)? The mandate’s challengers want you to think a broccoli mandate would be absurd, because it would be absurd if it were passed today. But if a comet grazes the earth and causes mysterious mass plant extinctions, leaving only broccoli, and the WTO has adopted strict rules forbidding all agricultural subsidies…?
In fairness, the mandate’s challengers don’t really need to prove that a hypothetical mandate to buy broccoli or whatever would actually be unconstitutional. For their purposes it could suffice just to draw attention to the need for “logical limitation” on the scope of the commerce power. However, they should at least have to explain why factual limitations that exist won’t do. There may be a way to do that, but it would require a vegetable far more absurd than broccoli to convince me with this argument.
The Non-Paradox of Waste and Underspending
We dump immense sums of money into the healthcare system for treatments and procedures that don’t improve our health or that we don’t need in the first place. At the same time, we’re not getting a lot of care we actually need. The first problem is that we’re wasting resources, and a rational solution to that problem should mean spending less. The second problem is that we need more prevention, and a rational solution to that problem should mean spending more. Well, which is it then? Spend less, or spend more?
The answer is both, says Aaron Carroll:
So we’re confronted with a set of [USPSTF] screening recommendations with excellent evidence that aren’t paid for, and a list of screening tests that are recommended against that are paid for. That’s how you wind up with a system that (1) costs too much and (2) has sub-optimal quality. You pay for stuff that doesn’t clearly work and don’t pay for stuff that does.
Overspending in some areas, underspending in others. Not a paradox.
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