What was this about: Individual Health Insurance Tax Credits Secured from a Federal Exchange
For states that DID NOT create a State-sponsored Health Insurance Exchange, …they used “the Federally-run HealthCare.gov Exchange / i.e., website”
(Thirteen states DID CREATE their own Health Insurance Exchange, California was one of them and it’s called Covered California; 37 States DID NOT CREATE their own Health Insurance Exchange)
Six million people secured a Tax Credit/Subsidy/Free Health Insurance from the “the Federally-run Health Insurance Exchange; i.e., HealthCare.gov.
The argument in the King v. Burwell Case was that Tax Credits/Subsidy/Free should only be available to residents of a state if and only if the State has created a Health Insurance Exchange; i.e., Health Insurance Tax Credits should NOT be available to people if they have secured them via HealthCare.gov, the Federal Exchange.
This was about State v Federal government powers: “Can the Federal government come into a state and setup a Health Insurance Exchange and give residents of that state a tax credit?”
The Supreme court ruled today, that Federal subsidies will be allowed regardless if they are secured from a state or Federal Exchange.
What would have happened if the ruling was the opposite?
Six million middle and low income adults would have lost their Tax Credit/Subsidy/Free Health Insurance.
These six million people would have left the individual market as health insurance would have been unaffordable to them
Rates in the individual market would have increased by more than 50%, leading to further deterioration of the individual and destabilizing the individual market and the core foundation of ObamaCare
What impact would have this had on Group Health Insurance Market?
Given the current ruling, NONE.
Given the opposite ruling, large tidal waves in the water can affect all shores …a mass exodus in the individual market, leading to spiking of claims in the individual market, leading to nervous insurance companies (Anthem, Cigna, Blue Cross, etc..) had the propensity of increasing of rates in the group market in order to stabilize the individual market
Will this stop being a political football now? Is the duel over?
Unlikely. ACA will move off the daily political talking point, until the outcome of the political election in 2016. If Republicans secure control of the executive and legislative branches then and only then will we see significant amendments to the law. Given the integration of the law into the DNA of the health care industry, it’s fair to assume a repeal being an outlier outcome.
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