We begin by clarifying the role the ACA’s legislative
history might play in our analysis. Legislative history is a
means to an end, to be consulted for evidence of
congressional intent. See, e.g., Sierra Club, 551 F.3d at 1027.
But legislative history is not the sole, or even the primary,
source of such evidence. Rather, “[t]he most reliable guide to
congressional intent is the legislation the Congress enacted.”
Sierra Club, 294 F.3d at 161; see also Cal. Indep. Sys.
Operator Corp. v. FERC, 372 F.3d 395, 400 (D.C. Cir. 2004)
(“[W]e assume ‘that the legislative purpose is expressed by
the ordinary meaning of the words used.’” (quoting Sec.
Indus. Ass’n v. Bd. of Governors of Fed. Reserve Sys., 468
U.S. 137, 149 (1984))); Engine Mfrs. Ass’n, 88 F.3d at 1088
(noting that the “most traditional tool” for “determin[ing]
Congressional intent” is “to read the text”). Where used,
legislative history plays a distinctly secondary role. Its
purpose is not to confirm already clear text; clear text speaks
for itself and requires no “amen” in the historical record. See,
e.g., Harrison v. PPG Indus., Inc., 446 U.S. 578, 592 (1980)
32
(“
t would be a strange canon of statutory construction that
would require Congress to state in committee reports or
elsewhere in its deliberations that which is obvious on the
face of a statute.”). Instead, only when “apparently plain
language compels an ‘odd result’” might we look to
legislative history to ensure that the “‘literal application of a
statute will [not] produce a result demonstrably at odds with
the intentions of its drafters.’” Engine Mfrs. Ass’n, 88 F.3d at
1088 (quoting Public Citizen, 491 U.S. at 454, and United
States v. Ron Pair Enters., Inc., 489 U.S. 235, 242 (1989)).
Thus, accepting for the sake of argument the government’s
contention that the results of appellants’ construction of
section 36B are odd, our inquiry into the ACA’s legislative
history is quite narrow. In the face of the statute’s plain
meaning—a federal Exchange is not an “Exchange
established by the State”—we ask only whether the legislative
history provides evidence that this literal meaning is
“demonstrably at odds with the intentions” of the ACA’s
drafters. Unless evidence in the legislative record establishes
that it is, we must hew to the statute’s plain meaning, even if
it compels an odd result. See id. (“[T]here must be evidence
that Congress meant something other than what it literally
said before a court can depart from plain meaning.”); accord
Garcia v. United States, 469 U.S. 70, 75 (1984) (noting that
“only the most extraordinary showing of contrary intentions
. . . would justify a limitation on the ‘plain meaning’ of the
statutory language”); Bldg. & Constr. Trades Dep’t, AFL-CIO
v. U.S. Dep’t of Labor Wage Appeals Bd., 932 F.2d 985, 990
(D.C. Cir. 1991).
Here, the scant legislative history sheds little light on the
precise question of the availability of subsidies on federal
Exchanges. The government points, for example, to a
Congressional Budget Office report from November 2009,
before the ACA’s adoption, that calculated the cost of
33
subsidies based on the assumption that they would be
available in all states. But that assumption is as consistent
with an expectation that all states would cooperate (i.e.,
establish their own Exchanges) as with an understanding that
subsidies would be available on federal Exchanges as well.
Cf. Robert Pear, U.S. Officials Brace for Huge Task of
Operating Health Exchanges, N.Y. TIMES, at A17 (Aug. 5,
2012) (“When Congress passed legislation to expand
coverage two years ago, Mr. Obama and lawmakers assumed
that every state would set up its own exchange . . . .”). Equally
unilluminating are floor statements by Senate sponsors of the
ACA touting the availability and benefits of premium tax
credits in general, but not addressing the precise issue of
whether they would be available on federal Exchanges.
The government and its amici are thus left to urge the
court to infer meaning from silence, arguing that “during the
debates over the ACA, no one suggested, let alone explicitly
stated, that a State’s citizens would lose access to the tax
credits if the State failed to establish its own Exchange.” Br.
of Amici Members of Congress and State Legislatures 8. The
historical record, however, belies this claim. The Senate
Committee on Health, Education, Labor, and Pensions
(HELP) proposed a bill that specifically contemplated
penalizing states that refused to participate in establishing
“American Health Benefit Gateways,” the equivalent of
Exchanges, by denying credits to such states’ residents for
four years. See Affordable Health Choices Act, S. 1679, 111th
Cong. § 3104(a), (d)(2) (2009). This is not to say that section
36B necessarily incorporated this thinking; we agree that
inferences from unenacted legislation are too uncertain to be a
helpful guide to the intent behind a specific provision. See
Village of Barrington v. Surface Transp. Bd., 636 F.3d 650,
666 (D.C. Cir. 2011). But the HELP Committee’s bill
certainly demonstrates that members of Congress at least
34
considered the notion of using subsidies as an incentive to
gain states’ cooperation.
In any case, even if the historical record were silent, that
silence is unhelpful to the government. For the court to depart
from the ACA’s plain meaning, which favors appellants,
“there must be evidence that Congress meant something other
than what it literally said,” from which the court can conclude
that applying the statute literally would be “‘demonstrably at
odds with the intentions of [the ACA’s] drafters.’” Engine
Mfrs. Ass’n, 88 F.3d at 1088 (quoting Ron Pair Enters., 489
U.S. at 242) (emphases added). As Chief Justice Marshall
wrote, “it is incumbent on those who oppose” a statute’s plain
meaning “to shew an intent varying from that which the
words import.” United States v. Fisher, 6 U.S. (2 Cranch)
358, 386 (1805). Nothing the government or its amici cite
demonstrates what that precise intent was. And “n the
absence of such evidence, the court cannot ignore the text by
assuming that if the statute seems odd to us, i.e., the statute is
not as we would have predicted beforehand that Congress
would write it, it could be the product only of oversight,
imprecision, or drafting error.” Engine Mfrs. Ass’n, 88 F.3d at
1088-89; see also id. at 1091 (“With such a meager record of
what happened in conference, the court is unable to
reconstruct the legislative compromises that were made. Even
if the final product might strike us as unexpected . . . the court
could not make the leap from such an impression to the
certainty that such a result was unintentional.”).
The government, together with the dissent, also leans
heavily on a more abstract form of legislative history—
Congress’s broad purpose in passing the ACA—urging the
court to view section 36B through the lens of the ACA’s
economic theory and ultimate aims. They emphasize that to
achieve the goals of “near universal coverage” and
35
“lower[ing] health insurance premiums,” 42 U.S.C.
§ 18091(2)(D), (F), the ACA relies on three interrelated
policies: insurance market reforms prohibiting insurers from
denying coverage or charging higher premiums based on an
individual’s health status, see, e.g., id. § 300gg (community
rating requirement); id. § 300gg-1 (guaranteed issue
requirement); the individual mandate, see 26 U.S.C. § 5000A;
and subsidies to individuals purchasing insurance in the
individual market, see id. § 36B. These policies, the
government and dissent explain, are like the legs of a threelegged
stool; remove any one, and the ACA will collapse. The
insurance market reforms are necessary to expand the
availability of insurance. The individual mandate is necessary
to avoid the adverse selection that would result if people
could exploit the insurance market reforms to wait to
purchase insurance until they were sick. And subsidies are
necessary both to make the mandated insurance affordable
and, in so doing, to expand the reach of the individual
mandate by reducing the cost of insurance below the
threshold—eight percent of household income—at which
taxpayers are exempt from the mandate’s penalty. See 26
U.S.C. § 5000A(e)(1)(A)-(B). Given this structure, the
government and dissent argue that it is “inconceivable” to
think Congress would have risked the ACA’s stability by
making subsidies conditional on states establishing
Exchanges.11 Dissenting Op. at 2.
11 Appellants do not challenge the government’s account of the
economic theory behind the ACA, but they contend that the theory
must be understood through the lens of political reality. In their
telling, section 36B is the product of legislative compromise to
secure the support of Nebraska Senator Ben Nelson, the crucial
sixtieth vote needed to avoid a filibuster. Nelson opposed House
plans for a national, federally-run exchange, fearing that it would
36
set the United States down a path to a single-payer system. See
Carrie Budoff Brown, Nelson: National Exchange a Dealbreaker,
POLITICO (Jan. 25, 2010), http://www.politico.com/livepulse/0110/
Nelson_National_exchange_a_dealbreaker.html. To gain Nelson’s
support, proponents of the ACA scrapped the national exchange in
favor of establishing exchanges on a state-by-state basis. This
change, in turn, required Congress to devise means of inducing
states to take on the politically and technologically challenging task
of establishing exchanges. Congress’s solution, appellants maintain,
was a package of “carrots” and “sticks” for states. The carrots
included federal grants to states for “activities (including planning
activities) related to establishing an [Exchange].” 42 U.S.C.
§ 18031(a)(3). The sticks included the prohibition against
tightening Medicaid eligibility requirements imposed on states that
do not create their own Exchanges. See id. § 1396a(gg). The most
important incentive of all, appellants argue, was the provision at
issue here: making premium tax credits available only for
individual coverage purchased through state-established Exchanges.
According to appellants, the ACA’s supporters believed no state
would refuse so good an offer—and, appellants add, perhaps no
state would have had the IRS not eliminated this incentive by
proposing and promulgating the IRS Rule, making subsidies
available regardless of which entity established an Exchange,
before states had to elect whether to establish Exchanges. See
Health Insurance Premium Tax Credit, 77 Fed. Reg. 30,377, 30,378
(May 23, 2012); Health Insurance Premium Tax Credit, 76 Fed.
Reg. 50,931, 50,934 (Aug. 17, 2011).
Like the government, however, appellants fail to marshal
persuasive evidence (apart from the statutory text, that is) in
support of their theory. Senator Nelson may have opposed a single,
national exchange, but it does not necessarily follow that he
opposed making subsidies available on federal fallback Exchanges
in uncooperative states. Similarly, the fact that the ACA contained
some incentives to states does not necessarily mean that section
36B is one of them. Nor does the fact that Congress has conditioned
federal benefits on state cooperation in other contexts shed light on
37
Yet the supposedly unthinkable scenario the government
and dissent describe—one in which insurers in states with
federal Exchanges remain subject to the community rating
and guaranteed issue requirements but lack a broad base of
healthy customers to stabilize prices and avoid adverse
selection—is exactly what the ACA enacts in such federal
territories as the Northern Mariana Islands, where the Act
imposes guaranteed issue and community rating requirements
without an individual mandate. See 26 U.S.C. § 5000A(f)(4)
(exempting residents of such federal territories as Puerto Rico
and the Northern Mariana Islands from the individual
mandate by providing that they are automatically treated as
having “minimum essential coverage”); 42 U.S.C. § 201(f)
(providing that the Public Health Service Act, where the
guaranteed issue and community rating requirements appear,
applies to residents of such territories). This combination,
predictably, has thrown individual insurance markets in the
territories into turmoil. See Sarah Kliff, Think Your State Has
Obamacare Problems? They’re Nothing Compared to Guam,
WASH. POST (Dec. 19, 2013),
http://www.washingtonpost.com/blogs/wonkblog/wp/2013/12
/19/think-your-state-has-obamacare-problems-theyre-nothingcompared-
to-guam/. But HHS has nevertheless refused to
exempt the territories from the guaranteed issue and
the precise question of whether Congress did so in section 36B.
Thus, the most that can be said of appellants’ theory is that it is
plausible. But we need not endorse appellants’ historical account to
agree with their construction of section 36B. “Where the statutory
language is clear and unambiguous, we need neither accept nor
reject a particular ‘plausible’ explanation for why Congress would
have written a statute [as it did].” Barnhart, 534 U.S. at 460.
