Affordable Care Act supporters rally at the United States Supreme Court June 25th, 2015, just after the announcement of the King v. Burwell decision upholding subsidies on federal health exchanges. (Flickr Creative Commons/Victoria Pickering)

The U.S. Supreme Court on Thursday upheld a key provision of the Affordable Care Act, allowing 17,000 Wyoming residents to keep receiving federal subsidies for health insurance.

The decision in the King v. Burwell case was a defeat for Wyoming’s Republican congressional delegation that would like to repeal the Affordable Care Act, or see it unraveled by legal challenge. But it means that the number of Wyoming’s uninsured residents is not likely to spike — a predicted result had the court ruled the other way.

The suit challenged the authority of the federal government to provide insurance subsidies in 34 states that opted to use Healthcare.gov as a marketplace, rather than setting up their own state exchange.

A ruling against the subsidies could have caused thousands of insured Wyoming residents to drop their coverage, said Wyoming Department of Insurance Commissioner Tom Glause. Annual premiums for those remaining on the federal exchange in Wyoming could have skyrocketed by $4,000, according to analysis by Avalere Health, a consulting company.

If the subsidies ended, only those who desperately need insurance for preexisting conditions would remain in the insurance pool, Glause predicted. That would mean a less healthy insurance pool, higher use of services, and increased premiums.

In Wyoming, about 19,000 people purchased insurance on the federal marketplace, Healthcare.gov. Of that group approximately 92 percent, or 17,000 people, receive a subsidy for the plan. The average subsidy for individuals in Wyoming is $425 per month, or about $5,000 annually.

Statewide, the subsidies amount to $8.4 million monthly, and about $100 million per year flowing to insurance companies and healthcare providers. Across all 34 states with federal exchanges, 6.4 million people receive subsidies.

Legal points

The plaintiffs in King v. Burwell argued that language in the Affordable Care Act prohibited the federal government from providing subsidies in states through federal insurance exchanges.

The Supreme Court rejected that reading 6-3. The majority argued that while language in the ACA was ambiguous, the intent of Congress was to expand health coverage through subsidies, not limit it to states that set up state-based insurance marketplaces. (See the ruling at the bottom of this article.)

Wyoming delegation’s reactions

Sen. John Barrasso (R) expressed his disappointment in the ruling.

“Obamacare restricts Americans’ health care choices and forces them to pay higher taxes and higher premiums for services they neither need nor want,” Barrasso said in a statement. “Republicans will continue to fight to repeal and replace this unpopular law.”

Sen. Mike Enzi (R) urged Congress to seek bipartisan solutions to ongoing health care and insurance shortcomings.

“No matter the court’s ruling, it is time for Democrats and Republicans to deliver what the president promised but ultimately failed to deliver,” Enzi said. “We need a health system that expands coverage and promotes quality patient-centered care, while actually bringing costs down.”

However, neither Enzi or Barrasso were ready to immediately stop the payment of subsidies had King V. Burwell succeeded.

In April they joined 34 GOP Senators as co-sponsors on a bill that aimed to ease the transition off the subsidies by extending them until September 2017 if King v. Burwell were successful.

Such an extension would have reduced the impact of millions of currently insured people nationwide — and thousands in Wyoming — suddenly finding their premiums unaffordable. The same bill also would have struck down mandates that all individuals buy insurance and large employers offer it as a benefit.

Before the ruling, Glause projected that Wyoming would be left with limited options if the case were successful, all of which would cost more time and money.

“Our options are fairly limited as a state,” he said. They included taking no action, setting up a state exchange, or joining a multi-state exchange. Glause expected neighboring states would hesitate to take Wyoming on as a partner, because adding Wyoming’s expensive-to-insure population would likely drive up premium costs for all states in the shared market.

Gov. Mead said that although he opposed the ACA and challenged it in a separate court case, the decision reaffirms that the ACA is the law of the land.

“This decision allows 17,000 people in Wyoming to continue to receive a tax credit for health insurance and avoids many potential complications of those individuals losing that credit,” Mead said. “It will still be necessary for Wyoming to develop its own path forward for better health care access and better health care for our citizens.”

Supreme Court Decision in King v. Burwell

 

Flickr Creative Commons photo by Victoria Pickering.

Gregory Nickerson

Gregory Nickerson worked as government and policy reporter for WyoFile from 2012-2015. He studied history at the University of Wyoming. Follow Greg on Twitter at @GregNickersonWY and on www.facebook.com/GregoryNickersonWriter/

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