http://www.washingtonpost.com/blogs/plum-line/wp/2015/01/02/morning-plum-a-scotus-decision-gutting-obamacare-could-cause-widespread-disruptions/ By Greg Sargent January 2 at 9:17 AM
One of the big, looming questions of 2015 is this: Will the Supreme Court really gut Obamacare subsidies in the three dozen states on the federal exchange, potentially depriving millions of health coverage at a moment when the law, now heading into its second year, is clearly working as intended?
One thing to watch as we approach the SCOTUS hearings on King v. Burwell this spring is how many people are newly qualifying for subsidies in those states as this year’s enrollment period continues.
The Department of Health and Human Services has released a new report on enrollment data that suggests that number could be very large — which could (theoretically, at least) make it harder for SCOTUS to gut the law.
The administration says around 3.4 million people have signed up on the federal exchange in the new enrollment period. For various bureaucratic reasons (we don’t know who will end up paying or how many are just renewals), it’s too early to determine how many new people would be adversely impacted by a SCOTUS ruling against the law. But as Margo Sanger-Katz explains, the new HHS report also offers a rough guide as to what we might expect, because in general terms a very high percentage of those on the federal exchange appear to qualify for subsidies:
Over all, it found, customers who were using HealthCare.gov to pick insurance plans — some new customers, and some renewing customers — were overwhelmingly likely to qualify for federal subsidies to help them pay their premiums. On average, the report found that 87 percent of these customers were eligible for subsidies, with higher percentages in some states — up to a high of 95 percent in Mississippi.
Those numbers don’t include everyone in the marketplace; people who were enrolled in plans this year and simply automatically renewed them weren’t counted. But it’s reasonable to think that the proportion is representative. Last year’s number at the end of open enrollment was an average of 85 percent. A different report…said that a total of 6.5 million people in those states had selected plans or been automatically renewed into plans as of last week.
So we could be looking at a lot of people who would lose subsidies in the event of a bad SCOTUS ruling, perhaps more overall than previous estimates of around four million. And the enrollment period still has six weeks to go.
Larry Levitt of the Kaiser Family Foundation adds key context, noting that the biggest enrollment bumps are occurring in big states on the federal exchange, rather than the state ones. “The big numbers of new enrollees are coming from states that are not running their own marketplaces, such as Florida and Texas, where the politics don’t seem amenable to them running their own marketplaces in the event of a Supreme Court ruling against the law,” Levitt tells me.
What this means: In federal-exchange states where the largest numbers of people might lose subsidies if SCOTUS rules against the law, state officials might be less likely to then set up their own exchanges to keep the subsidies flowing. Adds Levitt: “The impact of a potential Supreme Court decision against the law continues to grow.”
The reason this matters: Highlighting the potential for such a SCOTUS decision to result in widespread disruptions and dire consequences — both for millions who might lose coverage and for the insurance and health care industry in these states — may figure heavily in the government’s strategy for winning the case. Now, it’s possible that expected swing vote John Roberts won’t bother considering such disruptions and consequences in reaching his decision. But who knows — he just might. And the stakes continue to grow.
