At some point between now and June 30, the Supreme Court will hand down a decision that could be disastrous for nearly half a million Georgia residents.
The high court is scheduled to rule on a lawsuit challenging a key portion of the Affordable Care Act: tax credits provided by the federal government that make it possible for consumers to afford health care coverage obtained through Georgia’s health insurance exchange.
If the high court rules against the government in the case of King v. Burwell, then the tax credits that help pay the premiums for Obamacare coverage will be terminated.
Without the federal subsidies, it is estimated that somewhere between 400,000 and 500,000 Georgians would have to relinquish their coverage because they no longer could afford the premiums. They will lose their access to medical care, which could be fatal for someone with a serious illness like cancer.
“The price of coverage will go up,” said Bill Custer, the director of the Center for Health Services Research at Georgia State University. “There are a half million people or more in Georgia who are going to be affected.”
The situation has come about because of a four-word phrase included in the text of the ACA when it was adopted by Congress in 2010: “established by the state”
The law states that the federal subsidies for coverage will be paid through health insurance exchanges that are “established by the state.”
The plaintiffs who filed the King v. Burwell lawsuit argue that this phrase means subsidies cannot legally be paid in the states, which include Georgia, that declined to operate the exchange and turned over the responsibility to the federal government.
It is highly possible that the Supreme Court will rule the phrasing of the law makes those subsidies illegal in this and other states.
More than 541,000 people have signed up for health coverage through Georgia’s insurance exchange, an increase of more than 200,000 people from last year’s total of 316,000. About 89 percent of the enrollees — 480,000 people — are receiving federal tax credits to help pay for that coverage.
“Those losing coverage under a decision for the plaintiffs in King v. Burwell would include many people losing private coverage who did not receive tax credits as well as those who were eligible for tax credits that partially subsidized their premiums,” according to an analysis conducted by the Urban Institute and the Robert Wood Johnson Foundation.
The Urban Institute estimates that 435,000 Georgians would lose health coverage if the Supreme Court ruled against the federal government.
Custer says the total could be even higher, in the range of 500,000, because the loss of so many enrollees would force the insurance companies participating in the ACA exchange to recalculate their premiums. The revised premiums would be increased significantly, making coverage unaffordable for even more people.
“Not only will you lose your subsidies, you’ll be paying higher rates as well,” Custer said. “If it’s not a death spiral, it’s surely going to be a big price increase.”
If the Supreme Court strikes down the tax credits, it would be a major political victory for Gov. Nathan Deal and legislative Republicans, who oppose Obamacare and have tried to halt the program’s implementation here.
Deal and the legislators have also rejected another major aspect of the health care act: the expansion of Medicaid coverage to more low-income families.
Georgia is passing up more than $3 billion a year in federal funds that would otherwise be paid to doctors and hospitals that treat Medicaid patients. The money would enable nearly 400,000 more people to get coverage and provide much-needed cash for financially ailing hospitals in rural areas.
Deal’s opposition to Medicaid expansion has not diminished, however.
At the Republican Party’s state convention last month, Deal boasted in a speech: “We have resisted. We have not expanded Medicaid, as you know, despite all the pressure on us from the media and others.”
It is impossible to predict with any degree of accuracy how the Supreme Court will ultimately decide this issue. The justices may rule with the government and keep the tax credits in place.
If the court rules the other way, it’s going to make life a lot more difficult for hundreds of thousands of Georgians.
Tom Crawford is editor of The Georgia Report.