Daily Record

Could Supreme Court Case Kill Obamacare?

Daily Record — Monday, March 2, 2015

By Michael L. Diamond

New Jerseyans who bought health insurance through the Obamacare exchange could lose their subsidies that made it affordable, depending on the outcome of a U.S. Supreme Court case that's set to be heard on Wednesday.

It would cause the average annual health insurance premium to soar from $5,772 to $8,489, or 47 percent, according to a study released Monday by consumer advocates.

"The loss of tax credits would create a crisis in our state," said Ray Castro, senior policy analyst at New Jersey Policy Perspective, a left-leaning research group that has supported the health reform law. "Not only would those receiving them be affected, but insurance costs for those without them would dramatically increase as well."

The case, King v. Burwell, represents Obamacare opponents' latest bid to undo the Patient Protection and Affordable Care Act, the federal law that requires nearly everyone to have health insurance or pay a steep penalty.

They argue that the ACA doesn't explicitly provide subsidies to consumers in states that didn't set up their own exchanges. New Jersey was one of 34 states that don't have a state exchange, but use one administered by the federal government instead.

Democratic Senators, writing in the Washington Post, said the law makes it clear that the federal exchange functions the same as the state exchange, and people who use either one are entitled to financial assistance. The plaintiffs say Congress excluded subsidies in the federal exchange so that states would set up their own marketplaces.

"There is thus no basis in law, common sense, or any part of the ACA for the extraordinary notion that Congress went out of its way to limit "exchange"... with the qualifier "established by the State," but secretly meant to include those "established by (the federal government,)" the plaintiff's attorneys wrote.

Consumer groups who favor the law said taking the subsidies away would be devastating. There were 253,000 New Jerseyans who selected a plan in the marketplace. About 84 percent of them, or 210,000, received a tax credit to make the premiums more affordable. It would force some of them to drop coverage, increasing the state's rate of people without health insurance. And it could lead to higher prices for consumers who are insured.

"This is a case of King versus the more than 200,000 New Jerseyans and others like them all across America who have health coverage because of tax credits," said Maura Collinsgru, health care program director for New Jersey Citizen Action, a consumer advocacy group that favors Obamacare.

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