Wednesday, March 11, 2015

King Me

Supreme Court watchers are awaiting the opinion in King v. Burwell more eagerly than any other this term.  If you've forgotten, this is the case investigating whether IRS regulations can be allowed that provide subsidies for states without state-run health care exchanges*.  One side argues the law is clear--only states with their own exchanges get subsidies.  The other side claims this is either a defect in how the law is written, or a defective interpretation, and either way, can be interpreted by the IRS to allow subsidies for all states.

I'm not sure what the big deal is. First, I question if the Court will say the IRS can't help out the Affordable Care Act by spreading the subsidies all around.  There are four certain votes for this point of view and at least two possibles.

But even if the Court says no go, how much difference will it make?  Some seem to be saying this will destroy the ACA, but how?  At first it may mean some dislocation, but I think this is exaggerated.  It'll only effect a small percentage of the population, and many of these people either weren't buying health insurance a few years ago and getting health care anyway, or sometimes buying it but not always.  At worst, we'll go back to that.  And that's at worst--many will just continue to buy it, or go onto a government program.

More important, if a bunch of states suddenly lose a subsidy their citizens are enjoying, many of them may quickly set up an exchange.  Meanwhile, there'll be pressure on Congress to fix the glitch, or at least patch it up.  Perhaps the Republicans won't want to play along, but it wouldn't take too many of them to cross the aisle for a majority, and if there's public pressure, they might all rush to create a one or two year fix while the states work things out.  (And if there's no public pressure, it's probably because it's no big deal to begin with.) On top of all that, the White House can put tremendous pressure on insurance companies to keep costs down for certain types. It also might even find imaginative ways to give out subsidies that can be challenged in the courts, but by the time those cases come up this Administration will be long gone.

Meanwhile, the law will still be in place.  That won't change.  So destroy Obamacare?  No, that boat sailed with Robert's decision in the previous case.

*As far as I can tell, 14 states have their own health care exchanges, including California and New York.  But another 19 have some sort of state-federal mix--it's not clear what will happen in these cases.


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