By our count at the Galen Institute, more than 49 significant changes already have been made to the Patient Protection and Affordable Care Act: at least 30 that President Obama has made unilaterally, 17 that Congress has passed and the president has signed, and 2 by the Supreme Court.
By Orrin Hatch, Lamar Alexander and John Barrasso
Wednesday, the Supreme Court will hear oral arguments about whether the Obama administration used the IRS to deliver health insurance subsidies to Americans in violation of the law. Millions of Americans may lose these subsidies if the court finds that the administration acted illegally. If that occurs, Republicans have a plan to protect Americans harmed by the administration’s actions.
When the court rules in King v. Burwell, we anticipate that it will hold the administration to the laws Congress passed, rather than the laws the administration wishes Congress had passed, and prohibit subsidies in states that opted not to set up their own exchanges, as the language in the law clearly states. Such a ruling could cause 6 million Americans to lose a subsidy they counted on, and for many the resulting insurance premiums would be unaffordable.
Republicans have a plan to create a bridge away from Obamacare.
First and most important: We would provide financial assistance to help Americans keep the coverage they picked for a transitional period. It would be unfair to allow families to lose their coverage, particularly in the middle of the year.
On March 4, 2015, the Supreme Court will hear oral arguments in King v. Burwell. The key issue in this case is how the government may provide subsidies to people buying health insurance through government exchanges created by the Affordable Care Act, or ObamaCare. This case could also determine whether millions of Americans are free from the law’s onerous mandates and fines.
There are effectively two categories of exchanges: those “Established by a State” (described in Section 1311 of the law’s text) and the federal exchange (described in Section 1321). The statute authorizes the federal government to provide subsidies to enrollees in the state-established exchanges, but not the federal exchange.
When it became clear that many states — today as many as 37 — would not establish their own exchanges, the IRS issued a rule in 2012 allowing those who purchase insurance through the federal exchange to also receive subsidies. Plaintiffs in King v. Burwell claim the IRS acted illegally and did not have authority to do this.
Ultimately, it is up to the Court to declare that the Administration must uphold the law as written by Congress, not to refashion the law. A ruling in favor of petitioners in King could free millions of people from the law’s most onerous provisions, and could present a great opportunity to move past ObamaCare’s political stalemate and to seek a better path forward for healthcare policy.
DANVILLE (KPIX 5) – Tens of thousands of people who buy their health insurance through Covered California will get an unpleasant surprise when they file taxes this year.
Stacy Scoggins gets plenty of mail from Covered California, but the one tax form the agency was required to send her by February 2nd still hasn’t arrived.
“After being on hold for 59 minutes, they told me that the 1095-A was never generated,” Scoggins told KPIX 5 ConsumerWatch.
She’s talking about the 1095-A form, a document required for enrollees to file their tax returns. It’s a problem, for the recent widow who desperately needs to file now.
Facing high costs but smaller budgets, states like Hawaii and Rhode Island are struggling to find financially and politically sustainable ways to keep their health exchanges running.
Jeff Kissel’s first task when he took over Hawaii’s health exchange was making sure it worked after a botched first year, but a close second was finding a way to pay for it. The former gas utility CEO is now lobbying his legislature — what he calls “taking a forceful stand for why this business decision works”– to keep the exchange’s lights on.
EARLY next month the Supreme Court will hear arguments in King v. Burwell, the latest significant legal challenge to the Affordable Care Act. The petitioners argue that under the statute, the federal government is not allowed to provide health insurance subsidies in the 37 states that have either declined or failed to establish their own exchanges.
Should the court decide in the petitioners’ favor, most likely in June, critics in Congress will feel vindicated. But then comes the hard part: Congress must be ready with a targeted plan to help at least six million people who would quickly lose that federal assistance, and most likely their insurance.
While several Republicans in Congress have offered serious proposals to replace Obamacare, debating a wholesale replacement of the Affordable Care Act would take months, even years. But it is essential for Congress to move fast on a short-term solution. About 85 percent of people who bought plans on the exchanges receive subsidies, and most could not afford the policies without them. If fewer people are enrolled and new enrollments decline, premiums will rise, leading to the breakdown of the exchange markets.
If the Supreme Court decides that the Affordable Care Act means what it says — that subsidies are available only if a state establishes its own exchange — then President Obama’s signature legislative initiative would be significantly weakened in two-thirds of the states.
Fortunately, there is a way out, one that President Obama, forced by the court to the negotiating table, might be willing to accept. The first step would be for Congress to pass legislation that would allow people to keep subsidies they have already received, and allow subsidies for existing policies to continue through this year so people don’t immediately lose their existing coverage.
Then, beginning in 2016, instead of subsidies to individuals, the 37 states without exchanges could receive a new, capped allotment from the federal government that we call health checks. States could use the allocation to provide immediate premium assistance to people affected by the court decision, and similar checks could be extended to others who would need insurance afterward.
The money would be distributed using the same infrastructure used to disburse funds for the Children’s Health Insurance Program, which covers nearly nine million children. States know how to manage this platform, and could use it to distribute insurance premium support. (The “checks” could, of course, be distributed as electronic credits to insurers, which would be applied on a monthly basis to offset the cost of insurance policies individuals select.)
This might sound like the same subsidies by a different name, but one advantage would be that health insurance policies supported by health checks would not be subject to the Affordable Care Act’s mandates, taxes, insurance rules and benefit requirements.
Currently, to qualify for a subsidy under the act, a health plan must cover a long list of benefits, many of which unnecessarily increase costs. Under our plan, people could apply their allotments toward the purchase of any health insurance plans or policies approved by their state. States could decide what regulations were needed to protect consumers while still providing opportunities for less expensive policies unburdened by excessive regulation and mandates. Such flexibility would also increase enrollment rates: People would be more likely to purchase policies if they had options that cost less and better fit their needs.
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Of course, in reality, should the court decide against the Affordable Care Act, there are other options. Some supporters of the law are encouraging President Obama to simply declare existing federal exchanges to be state exchanges or license them to the states — a move that would further complicate an already ungainly law and already frayed executive-congressional relations.
Others say that the 37 states without federal exchanges would have no choice but to quickly establish exchanges so that residents didn’t lose coverage, even if they were ardent opponents of the law. Some might, but it’s a good bet that many wouldn’t, at least not in time to prevent their citizens from losing coverage.
Health checks offer a politically palatable third way. They would return control over health insurance to the states, with new resources to help their residents. And they would preserve the Affordable Care Act’s present extension of coverage, which would make them more palatable to the Obama administration.
There is no way to know how the Supreme Court will rule in King v. Burwell, but it is incumbent upon both parties in Congress to be ready for the fallout should it decide against the Affordable Care Act. Health checks offer a simple, practical answer, and a start toward further efforts to reform our health insurance system.
•Avik Roy’s Transcending Obamacare reform proposal retains a number of core features of the Affordable Care Act, even while promising to modify them at the margins.
•Despite the plan’s initial aversion to political risk, Roy places several longshot bets on proposed policy reform results.
•The plan strives too narrowly to ensure that high-deductible health insurance will be the dominant (or, perhaps, exclusive) form of exchange-based coverage and neglects or avoids a number of other reform opportunities. It is also prone to overly optimistic fiscal projections, insufficient details, and ad hoc revisions that fail to hold together.
After the lofty promises that led to passage of the Patient Protection and Affordable Care Act, young people are waking up to how much the law targets them with higher costs. Yes, those lucky enough to be covered on their parents’ health plans can postpone the consequences until they are 26. But for the rest, the situation is grim: Young people face disproportionately high costs to pay for coverage and a crushing burden of taxes that could impede their future prosperity.
By Avik Roy On March 4, the Supreme Court will hear oral arguments in King v. Burwell, the case that many pundits claim will “blow up Obamacare.” That’s an exaggeration; whatever the High Court decides, Obamacare will remain entrenched in federal law. But if the Supremes do end up ruling against the Obama administration—a distinct possibility—they will be giving Congress a uniquely important opportunity to reshape the Affordable Care Act in far-reaching ways. Here’s how that could work.
Deluged with catastrophes, court challenges and criticism, Obamacare (ACA) has had a controversial life to date. Yet it is ready to enter a completely new phase where the implementation gets shifted to the Internal Revenue Service – America’s favorite three words. If you liked the health care plan up to now, you ain’t seen nothing yet.