King vs Burwell, what you need to know as the verdict nears – day late…

Supreme-Court-Night

Update 06/25/15 – Here’s the problem with doing blogs ahead of time, sometimes news isn’t news when you’re ready to post the blog.  The Supreme Court wasn’t expected to announce a decision until next Monday, instead it came 06/25/15 and they ruled in favor of the federal government so the exchange is legal even in states without a state-run exchange but by reading below you will understand why the decision was a big deal and why you should be glad they ruled the way they did.

So this is a big week for health care, and the Supreme Court of the United States will make a ruling that will either solidify Obamacare or shatter it.  Here’s what you need to know.

The Supreme Court is expected to release a decision on King v. Burwell by the end of the month, and that decision will impact the future of Obamacare.

While the case has dominated the thoughts of lawmakers, Court watchers, and health journalists, about seven in 10 Americans have heard only a little or nothing at all about case thus far. Only 13 percent have heard a lot about it, according to the Kaiser Family Foundation. And even for those closely watching the case, the details can be confusing, which is why National Journal has laid them out here.

Who is the plaintiff?

The case is brought by conservative opponents of the law. Specifically, the plaintiffs are David M. King and three other challengers, all of whom are Virginia residents.

Who is the defendant?

The Obama administration. Top administration officials, including Health and Human Services Secretary Sylvia Mathews Burwell, are listed as defendants because the lawsuit challenges an IRS rule that their agencies helped create and implement.

Wait—I thought the Supreme Court already said Obamacare is constitutional.

The case here isn’t about the law in general, it’s about the specific question of whether tax credits, or subsidies, offered on federally established exchanges are legal under Obamacare. The law allowed states to establish their own insurance exchanges or to let the federal government do it for them using the HealthCare.gov exchange.

The plaintiffs argue that four words in the tax section of the law, “established by the state,” indicate that Congress intended for subsidies to be received only by enrollees on state exchanges, and that the law should be read as it is written.

Missouri does not have a state-run exchange so residents of Missouri are only able to participate in the federal exchange.  This is an important point if you’re a Missourian and you participate in the exchange. Why you ask, well it’s because your subsidies may end – abruptly!

The defendants argue that the law should be read in its entirety, in which case it is clear that subsidies are offered on all exchanges, and that was the authors’ intent all along.

Which justices are up in the air on how they’ll rule?

Chief Justice John Roberts and Justice Anthony Kennedy are expected to be the swing votes between the solidly liberal and conservative wings.

Who is affected if the challengers win?

Directly, 6.4 million people who receive subsidies from federal exchanges.

But the damage wouldn’t end there; it would extend to everyone on federally established exchanges. If people lose their subsidies, health insurance could become unaffordable for many, and the healthy will drop it. This would cause premiums to rise for everyone on the exchange. More people would then drop coverage, and premiums would rise again—etc. etc. This phenomenon is commonly referred to as the “death spiral.”

How many states are impacted?

This depends in part on how the Supreme Court defines a federal exchange, but at least 34.  Missouri is one of the 34.

Kaiser has released a handy map graphic that shows a breakdown of the state-by-state impact of the case.

What happens to the states that established their own exchanges?

As far as we can tell, nothing.  I live in Missouri and most of you reading this live in Missouri – Missouri never established an exchange.

How could this be fixed?

That’s a great question, and one that Congress, the Obama administration, and governors are all arguing about right now.

The president said last week that the law could be fixed with a single sentence, presumably an amendment making subsidies legal on all exchanges. Republicans however, are having none of it. They’ve put forward several plans to extend subsidies while knocking down much-hated parts of the law. The more conservative arm of the party is advocating against an extension of subsidies and for a repeal of the law’s mandates and regulations.

Several state governors have said they will not take action if King wins. Other states have started to establish their own state-based exchanges.

What happens if King loses?

Policy-wise, nothing.

Politically, Republicans have said they’ll focus on 2016 and getting one of their party’s candidates elected as president. Then, ideally, they could pass an  bill that would get an Obamacare repeal bill signed into law.

So, who’s going to win?

I have no clue but if King wins the real losers are those people in Missouri and 33 other states who rely on the federal exchange to make health coverage affordable.

About Craig Thompson

I am a young professional with two great sons, and I work in the healthcare setting. I am employed in hospital administration and serve as Chief Operating Officer at Golden Valley Memorial Healthcare in Clinton, Missouri. These are challenging and exciting times in healthcare and my blog will focus on healthcare, raising boys or being raised by boys, and living in mid America.
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