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Tax Credits on Federally Created Exchanges: Lessons from a Legislative Process Failure Theory of Statutory Interpretation

This Essay advocates that the question of whether, under the Affordable Care Act, individuals who purchase insurance on federally created exchanges are eligible for tax credits should be interpreted using a recently proposed method of reading statutes – the “legislative process failure theory of statutory interpretation.” Under this theory, courts should not rely on traditional judicial methods of interpreting statutory provisions, especially technical application of Textualist tools of interpretation, when those methods lead to a “best meaning” that likely was not the meaning that most legislators ascribed to the provision.  In such instances, courts should pay more attention to contextual clues to legislators’ likely understanding of the statutory provision, including legislative history. With respect to tax credits for purchasers on federally created exchanges, this Essay concludes that the fact that virtually no one seemed to be aware, when the ACA was passed, that it could be read to preclude such subsidies strongly supports reading the statute to authorize them.