New GOP Line: "King v. Burwell no biggie!" Jeffrey Young: "Um...actually, yeah, it's a biggie."
2019 OPEN ENROLLMENT ENDS (most states)
Time: D H M S
For months now, whenever I've crunched the numbers to figure out how many people would be screwed by an adverse King v. Burwell ruling by the Supreme Court (answer: around 6-7 million directly, plus another 6-7 million indirectly), I've always made sure to include one caveat: A small percent at the upper range of the federal subsidy range wouldn't really be impacted much:
- Assuming that NM, OR & NV are "in the clear" for federal subsidies (and this still isn't clear), you'd have to subtract around 175K from the total; call it 6.5 million who would actually lose their federal tax credits.
- Of those, let's assume that perhaps 5% are at the upper end of the tax credit limit and are therefore only receiving nominal credits (say, $30 or less per month). For those folks, losing these credits, in and of itself, would be annoying but hardly devastating; I have to imagine they won't drop their coverage if that was the only change (which it isn't, but I'll get to that in a moment).
However, I was just spitballing that 5%; I didn't do the actual math to see just how many people at various income levels would be seriously hurt. Fortunately, over at the Huffington Post, Jeffrey Young has done exactly that:
Get ready for a new line from the crowd that brought a lawsuit before the Supreme Court threatening to devastate Obamacare and snatch health insurance away from millions of people: The lawsuit won’t actually devastate Obamacare and snatch health insurance away from millions of people.
It may seem an odd argument coming from conservatives who created and pursued this legal case for the past three years as a terrific way to ruin Obamacare. But if they win, millions of people are going to lose their health insurance, and Americans who aren’t happy about that are going look for someone to blame -- maybe the people who brought the lawsuit, for example, or the Republican politicians who supported them.
...In the absence of a congressional fix to this crisis, trying to persuade the public there isn't much to worry about might be an understandable fallback strategy if you want the lawsuit to prevail. Enter the Heritage Foundation and the American Enterprise Institute, two conservative think tanks in Washington that do.
...That seems like it could be a problem, since 83 percent of Obamacare enrollees on the federal exchanges have annual incomes of 250 percent of the federal poverty level or less, which works out to no more than $23,450 for a single person, according to Avalere Health, a consulting firm. In other words, these aren’t Americans with a lot of extra money. And the average value of the tax credits they stand to lose is $263 a month, a substantial amount for people at this income level.
In other words, it looks like my off-the-cuff "95% are screwed" estimate is about right. Consider this: About 8.8 million people enrolled via HC.gov. 87% of them are receiving federal subsidies, or around 7.6 million. Meanwhile, 83% of all 8.8 million HC.gov enrollees are at 250% FPL or lower. That's about 7.3 million...which is about 96% of 7.6 million. Of course, not all of those folks will pay their premiums; at an 88% payment rate, you're down to about 6.4 million remaining who'd be in a world of hurt.
Young goes on to crunch the numbers a few different ways, but the point is that the vast majority of these people would have no viable/realistic options. He also points out a second way that these folks would be in major trouble:
And this doesn’t even factor in the effects of a second type of subsidy only available to people earning up to 250 percent of poverty, which reduces their out-of-pocket health care expenses, and which also would go away in the high court rules for the plaintiffs.
He's referring here to the Cost Sharing Reduction program, which is only available for those at 250% FPL or lower who enroll in Silver plans specifically. Andrew Sprung has a lot more info on this.
BUT WAIT, THERE'S MORE!!
Young doesn't even get into the other half of the story...the 7 million or so folks who aren't receiving federal tax credits at the moment either on or off of the ACA exchanges. THOSE people might not be financially ruined, but they'd sure as hell feel a nasty squeeze as THEIR premiums spike a good 35-47% in response to the King v. Burwell ruling.