Plenty on the Line as Supreme Court Rules on Obamacare Subsidy

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At the end of June, the Supreme Court is supposed to have a decision for the King v Burwell lawsuit. King v Burwell is focused on the issue of subsidies for lower-income Americans in the 34 states that have insurance-buying marketplaces controlled by the federal government. The plaintiffs argue that the language of the stipulation limits subsidies to the states that establish their own exchanges. If the Court agrees with King, more than 9 million Americans will lose their subsidies. This could be detrimental for the healthcare system as a whole because lower-income families would resort to emergency rooms for the care they urgently need, but can't afford. The bills that they fail to pay for would ultimately be the burden of everyone who does have insurance. The loss of subsidies would also cause the younger and healthier people to exit the insurance market, and as a result, premiums could increase up to 35%.

The easiest solution to this issue would be for Congress to revise the provision to clarify that subsidies are available in every state, but that is unlikely to occur because republicans do not want to extend the life of Obamacare.

Republican Senator Ron Johnson (R- Wis) proposed his bill, S 1016, as a bridge between Obamacare and a new approach to healthcare reform. The bill would allow subsidies to continue in states using federally operated exchanges until September 2017, but would deny subsidies to people who do not already have a subsidized policy. This would eliminate the lower-income people who move in and out of eligibility as their incomes fluctuate. In order to help these fluctuating consumers, the bill would allow states to approve less comprehensive insurance plans than Obamacare currently allows.

Written by Caroline Smith

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Caroline Smith is currently a senior at the University of Notre Dame and is a contributor to Medical Groups. She is majoring in Science-Business and Spanish. After graduation, Caroline plans on entering the field of healthcare consulting. She is most interested in the evolving policy changes in the healthcare industry and enjoys learning about new technologies that are being developed.