Monday, June 22, 2015

What affects would adverse Affordable Care Act ruling have on healthcare coverage?

We would like to know your thoughts.  The Supreme Court is poised to issue a ruling on the pending challenge to the Affordable Care Act.  Specifically, and perhaps too simply put, can the federal government provide subsidies for healthcare coverage in those who have enrolled in the federal government-sponsored

Here are two short notes from articles fowarded by a NAFEM member:

What a Supreme Court ruling against ObamaCare would look like:

The Supreme Court could decide this month that the financial help 6.4 million Americans receive to cover their health insurance costs are illegal — sending premium costs skyrocketing as much as 650 percent in states with some of the poorest residents.

The case, King v. Burwell, would affect people in the 36 different states that use as their marketplace. But the pain won't be felt equally.... The real losers in a ruling against Obamacare: the states that have the most people enrolled under the law and where incomes are low.

Take Florida, for example: an estimated 1.3 million people there are currently getting Obamacare tax credits. The financial help works out, on average, to $294 per person. And if the Supreme Court decides to take those tax credits away, premiums will increase by more than threefold. On average, they'll spike 359 percent.

Contrast that with Pennsylvania, a state that tends to have higher-income enrollees who get less financial help (Obamacare tethers the size of insurance subsidies to an individual's income; people who earn less get more). There, premiums would definitely increase; they'd go up an estimated 177 percent as people there lost, on average, a $229 tax credit.

Millions will lose tax subsidies — and lots of them live in Texas, Florida, and North Carolina
And this from another article. Study: Premiums would rise $3,300 if court rules against ObamaCare

Millions of people who buy insurance through ObamaCare could be forced to pay an average of $3,300 more in yearly premium costs if the Supreme Court strikes down subsidies this month, according to a study released Tuesday.

That steep cost increase would apply to every customer enrolled through

Four states — Mississippi, Maine, Alaska and Wyoming — would face increases of $4,000 or more, according to the study by Avalere Health that offers the latest warning about the potential impact of the ruling.

“Exchange enrollees are currently subsidized at a very high rate,” said Elizabeth Carpenter, director at Avalere. “As a result, many individuals would likely find exchange premiums unaffordable without the tax credits provided under the law.”

In addition to the potential price explosion, a ruling against ObamaCare could also cause major disruptions across the market.

People who can no longer afford coverage but are in generally good health would be more likely to drop out. That could “materially impact the risk-pool in both 2015 and future years,” the study warns.                                                                     

And many of the customers seeking cheaper options may no longer be able to re-enroll in their previous health plans.

About one-third of people who would be affected by the ruling previously had employer-sponsored insurance.      

While some may be able to rejoin their plans, “reports from insurance companies indicate that many small employers may have stopped offering coverage after exchanges launched in 2014,” according to the study.

“We can’t assume that consumers will simply be able to return to previous sources of coverage if subsidies are struck down,” said Dan Mendelson, CEO at Avalere. “The ACA [Affordable Care Act] has fundamentally shifted the insurance market, and the elimination of subsidies would mean the vast majority of those adversely affected will struggle to maintain access to care.”

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