Field Clinic bloggers react to Thursday's Supreme Court ruling upholding Affordable Care Act subsidies in all states:
Ruling disregarded the facts
We now know that the Roberts Court makes laws, it doesn't interpret them. His writing on this decision echoes the prior ruling on penalties or taxes. He decided both based on his view of societal good, not the facts of the case.
— Howard Peterson, managing partner of Philadelphia-based TRG Healthcare, a national healthcare consulting firm.
Supreme Court Got the Economics Right
Six justices on the court recognized that the overarching purpose and intent of the health care law was to make the individual health insurance market work. Prior to the ACA, buying affordable insurance on your own was extremely difficult and sometimes impossible because insurance companies logically tried to avoid higher risk consumers or charged them a lot more money. The ACA changed that by prohibiting insurance companies from charging higher prices to people with preexisting conditions – a provision only possible by requiring Americans to have insurance and making it affordable through subsidies. The Supreme Court understood the basic economic principles of the law and referred to them repeatedly in their majority opinion. Taking away subsidies in some states would have undercut the entire purpose and intent of the law.
This case is likely the last "big" decision before the court that would have threatened the basic tenets of the Affordable Care Act. So the obvious question is, what next? It's time to move on. The ACA is working – we have record low levels of uninsurance in America and insurance rates have on average been lower than expected. But there are still important questions. Are the subsidies large enough to make health insurance affordable and are the plans generous enough? It's important to know if financial barriers are still getting in the way of good health outcomes. How should we help consumers choose the best plan? Insurance is incredibly complicated and even the most educated consumers struggle to make a good choice. There are ways to simplify and support those decisions. Do consumers have adequate choice of providers in their insurance plan? So called narrow networks that limit consumer choices of providers lower premiums but do they lead to better or worse health outcomes.
These are hard questions to answer but in the long-run need to be answered. More importantly – as researchers answer them – it will require both political parties to come together to take what we're learning from the ACA and then tweak the law in ways that further improve health.
— David Grande, MD, director of policy at the University of Pennsylvania's Leonard Davis Institute of Health Economics.
Ruling protects law from future interference
"Congress passed the ACA to improve health insurance markets, not to destroy them."
This was the key finding made by the Supreme Court in its landmark decision upholding that the ACA requires that premium subsidies apply in all 50 states. The 6-3 decision, written by Chief Justice Roberts, not only ensures that the Affordable Care Act is here to stay for the duration of President Obama's term in office. Even more importantly, it ties the hands of any future administration from re-interpreting the statute to deny the subsidies in states that have let the federal government run their exchanges.
The Supreme Court could have ruled more narrowly, upholding the subsidies as a reasonable exercise of the IRS's administrative authority to implement a statute when the wording it unclear. Had it gone that way, a new President and his or her administration could have reinterpreted the statute so that the subsidies would no longer apply in states with federally-facilitated marketplaces. Instead, Justice Roberts on behalf of the court wrote, "This is not a case for the IRS. It is instead our task to determine the correct reading of [the statute]." And the statute, the court found, "compels the Court to reject petitioners' interpretation because it would destabilize the individual insurance market and likely create the very 'death spirals' that Congress designed the Act to avoid."
The Supreme Court decision doesn't mean the end of the Obamacare wars, of course. Congressional Republicans will still try to get changes, although the court's decision takes away their leverage to try to force President Obama to agree to repeal of major provisions of the law in order to keep the subsidies going. I now predict that there will be no major legislative changes in the ACA until President Obama leaves office.
The voters could elect a president in 2016 that is committed to changing or repealing Obamacare, but because the Supreme Court took away the next President's option to reinterpret the statute to discontinue the subsidies, they would need Congress to amend or repeal the law, no easy task. And by then, millions more Americans will have coverage from the ACA.
— Bob Doherty, senior vice president, governmental affairs and public policy, American College of Physicians.
Take nothing for granted
"We can breathe a sigh of relief, and we can hope that the Affordable Care Act's future is further solidified. But, in light of continued opposition and calls for repeal, advocates must remain vigilant and effective in articulating all the ACA is doing to improve the health care system. Now is not the time to take anything for granted."
"By protecting subsidies, the court is protecting a big part of Obamacare's hard-won coverage expansion. We simply must preserve and grow this expansion in coverage if hospital efforts to improve overall health and reduce health care spending are to succeed. People who have insurance are more likely to seek routine and preventive care and to take better care of themselves—essential steps toward better health that costs less on a per capita basis."
— Andy Carter, president and CEO, Hospital & Healthsystem Association of Pennsylvania.
Next challenge: Make care more affordable
The Supreme Court ruling helps ensure that we can continue to provide the security and stability that our members have come to expect from Independence Blue Cross, no matter how they purchase their health insurance coverage.
We have been serving our members for nearly 80 years, and no one has done more than we have to help make health care reform work.
However, while the health care reform law has increased access for many, there is still work to be done to make health care more affordable. At Independence we are partnering with physicians and hospitals to introduce new models of care to transform the health care system and provide better coordinated, quality care that helps patients get healthy faster and stay healthy longer. We will continue to work with other health care leaders to improve the quality of health care and rein in costs for everyone."
— Daniel J. Hilferty, president and CEO, Independence Blue Cross.
Time to move the focus away from court cases
As Timothy Jost mentioned in HealthAffairs, the King v. Burwell ruling may influence whether or not lower courts are willing to take on ACA cases. Since today marks the Supreme Court's second ruling in favor of the ACA, then hopefully this limits the number of ACA challenges coming through the court system. With this major victory for access to healthcare, hopefully the national spotlight can now be shared with important questions about healthcare cost and quality.
- Marcelo H. Fernandez-Viña, MPH
Pa. should keep pursuing state marketplace
The Supreme Court decision is a huge victory for consumers. By ruling to uphold tax credits for individuals enrolled in the Federal Marketplace 349,000 Pennsylvanians will not have to worry about losing access to necessary medical care. The Supreme Court found what most experts believed from the beginning: the ACA is clear that subsidies are available in both federal and state exchanges.
Now that the Supreme Court has ruled, instead of trying to undermine the law, opponents of health reform in Congress should accept that health care reform is here to stay and stop putting forward misguided proposals that would undermine its success.
We applaud the Wolf Administration for being proactive in the event of an adverse ruling. Now that the tax credits are upheld expediting this process is no longer a necessity. We still believe it is an important avenue to explore. A state-based marketplace would shift control, oversight and, importantly, accountability, from the federal government to the state, and could be established without enacting any new taxes. We encourage the Wolf Administration and lawmakers to explore how a state-based marketplace could better serve Pennsylvanians over the course of the next year.
- Antoinette Kraus, Director of the Pennsylvania Health Access Network
Back to bland
I signed on to a friend of the court brief in support of the government's assertion about a drafting error in the King v. Burwell case, so I am naturally pleased with the outcome. But why does it feel like such a letdown? One answer was suggested by my colleague Skip Rosoff—it's how you feel after the mega-hurricane supposedly making a beeline for your backyard ends up fizzling out. What to say other than it's back to business as usual, and business as usual is rarely the most exciting thing in the world.
But not quite. One thing the decision did accomplish is to settle, once and for all, the legitimacy of federally run exchanges. The most obvious implication is that this may lead more states with their own exchanges, especially those with administrative or financial difficulties, to substitute the federal healthcare.gov exchange for your state-run insurance brokerage company. While individual states are bound to behave individually, can we make any general predictions how a shift from various state managements to a single federal management model will affect things?
One very plausible conjecture is that, at least as long as Republicans maintain a blocking coalition in Washington, we can be pretty sure that federal exchanges will not be doing anything dramatic. They will try to run an efficient operation and will try to emulate as much as possible other neutral arrangements for facilitating purchasing—like Travelocity of Amazon, as President Obama once said.
What's more important is what the federally run exchanges will not do, but some states either have done or are planning to do: federal exchanges will not be aggressive in controlling premiums, controlling the content or operation of insurance policies, or generally trying to use the power to keep a firm off the exchange website as leverage to get that firm to do something politically attractive or to punish the firm for perceived bad behavior. We need only look at California's efforts to control the adequacy of networks, the extent of consumer protection, and other helpful but costly features to know that states with the opportunity find it hard to resist tweaking and sometimes more-than-tweaking the rules and the approvals to generate changes with populist benefits but hidden costs.
I personally would like my plan—were I shopping on an exchange—to have some of the features states have engineered—but as an economist I am familiar with the absence of free lunches and as a sometime specialist in political economy I think it preferable to avoid substituting political pressure for the approbation of the market as a vehicle for deciding what tradeoffs are worth making.It shouldn't be up to me or depend on my opinion. Consumers who avoid buying a plan because it has a very narrow network will be more effective in ensuring network adequacy than any kind of subjectively-based regulation.
So the bottom line is that King v. Burwell now legitimizes a way of generating and choosing among insurance plans that is going to be more politics-free than would have been the case with more state exchanges. There are some important problems remaining in many features of the ACA, and some real opportunities for improvement. But now the debate and discussion of those problems and programs will be returned to the legislative arena, and taken away both from the courts and from the unelected managers of exchanges. That seems like a step, not only toward democracy, but also toward stability and popularity for Obama care, which it surely needs.
- Mark V. Pauly, Professor of Health Care Management, Business Economics and Public Policy at The Wharton School
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