Minnesota’s Border Battles: COVID-19 edition
Last year, we released a report titled ‘Minnesota’s Border Battles‘ in which we compared the economic outcomes in Minnesota counties bordering other states with the outcomes in the border counties…
The Star Tribune reports that Minnesota’s Attorney General, Lori Swanson, will join several other states in suing to try to force the Trump administration to resume making “cost-sharing reduction” payments to health insurance companies. Trump announced yesterday that such payments would cease.
Completely absent from the Strib’s reporting is the reason why the Trump administration is suspending CSR payments: they are illegal, because Congress has not appropriated money to fund them. In fact, a federal court has already ruled that the CSR payments that were made by the Obama administration were unconstitutional.
Last May, in U.S. House of Representatives v. Burwell, Judge Rosemary Collyer of the U.S. District Court for the District of Columbia ruled that it was unconstitutional for the executive branch to make these insurer subsidy payments without Congressional authorization. She wrote:
The question is whether Congress appropriated the billions of dollars that the Secretaries have spent since January 2014 on Section 1402 reimbursements. The Secretaries rely on 31 U.S.C. § 1324, which expressly appropriates money for Section 1401 premium tax credits. In order to explain their paying Section 1402 reimbursements out of a permanent appropriation for IRS refunds, the Secretaries posit that Sections 1401 and 1402 are economically and programmatically integrated. A contrary reading of the amended appropriations statute, they contend, would yield absurd economic, fiscal, and healthcare-policy results.
The only result of the ACA, however, is that the Section 1402 reimbursements must be funded annually. Far from absurd, that is a perfectly valid means of appropriation. The results predicted by the Secretaries flow not from the ACA, but from Congress’ subsequent refusal to appropriate money. Such an appropriation cannot be inferred, no matter how programmatically aligned the Secretaries may view Sections 1401 and 1402. See 31 U.S.C.
§ 1301(d) (“A law may be construed to make an appropriation out of the Treasury . . . only if the law specifically states that an appropriation is made”). “This principle is even more important in the case of a permanent appropriation.” Remission to Guam & Virgin Islands of Estimates of Moneys to be Collected, B-114808, 1979 WL 12213, at *3 (Comp. Gen. Aug. 7, 1979).
Paying out Section 1402 reimbursements without an appropriation thus violates the Constitution. Congress authorized reduced cost sharing but did not appropriate monies for it, in the FY 2014 budget or since. Congress is the only source for such an appropriation, and no public money can be spent without one. See U.S. Constitution, Art. I, § 9, cl. 7 (“No Money shall be drawn from the Treasury, but in Consequence of Appropriations made by Law . . . .”).
Judge Collyer ordered an end to the illegal federal payments, but stayed her order pending appeal. The current Department of Justice, having reviewed the legal issues, now has concluded that Judge Collyer was correct, and that the subsidies that the Obama administration paid were unconstitutional. Therefore, the president has now elected to follow the law, and has ended the improper payments.
The Strib reporters, Christopher Snowbeck and Glenn Howatt, note that in the case of one insurer, “Our premiums for 2018 anticipated this action and were increased previously to account for it,” while “[m]ost insurers and regulators figured the administration would suspend the payments and have done what they can to plan for it.” But they never explain why the administration’s action was expected: a federal court has ruled that they payments are unconstitutional. Which means that Lori Swanson is trying to force the Trump administration to carry out an illegal act.
This is shamefully dishonest reporting of a shameful act by Minnesota’s Attorney General.