Supreme Court ruling could increase Obamacare premiums 700 percent
By Robert King | February 27, 2015 | 12:00 pm
If the government loses in a major Obamacare challenge before the Supreme Court, it will result in premium increases of up to 700 percent for nearly 8 million people, a new analysis claims.
The analysis from think tank Avalere Health was released Thursday as the Obama administration continues to take heat from Congress for having no backup plan in case the Supreme Court ruling in King v. Burwell doesn't go their way. Oral arguments are set to start on Wednesday for the case, which has the potential to cripple the healthcare law.
The case challenges the government's authority to dole out subsidies to the 37 states with federal-run exchanges. Plaintiffs say the Affordable Care Act specifically only allows for states that set up their own exchanges to receive subsidies, while the government says the plaintiffs are misinterpreting the law.
If the court rules in the plaintiff's favor, it will have a lasting impact as 87 percent of federal exchange customers get a subsidy to lower the cost of healthcare.
If the subsidies are illegal, average monthly premium contributions for about 7.5 million people could increase between 122 and 774 percent, depending on the state, according to Avalere.
Residents in Alaska and Mississippi would have the highest increases, the think tank said.
The premium increases are based on an analysis of federal data provided on the 2015 open enrollment period, which closed on Feb. 15, Avalere said.
While Obama administration officials emphasized earlier this week that there is no plan B, there are several options to preserve the subsidies for the nearly 8 million people.
For one thing, it is unclear how the court would define a state-based exchange, said Elizabeth Carpenter, who works in Avalere's health reform practice group.
"If the administration sees the potential for a regulatory fix following the ruling you are likely to see them try to solve the problem that way," she told the Washington Examiner.
If the administration can't do anything, Congress can step in and put together a short-term or long-term patch for the subsidies while lawmakers work on a more permanent solution, Carpenter added.
The court's ruling won't go into effect for 25 days, and the justices have been known to delay implementation of a ruling before, Carpenter said.
http://www.washingtonexaminer.com/supreme-court-ruling-could-increase-obamacare-premiums-700-percent/article/2560828
