What King v. Burwell Means for Health Insurance Consumers

Affordable Care Act

What King v. Burwell Means for Health Insurance Consumers

Published on March 18, 2015

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The Affordable Care Act is in front of the Supreme Court again. The case in question is called King v. Burwell and you’re going to hear a lot about it in the coming weeks and months.
In a nutshell, King v. Burwell is an argument about how to interpret language in the health reform law that describes how a state can distribute health insurance subsidies to qualifying consumers.
The Supreme Court will decide if the law allows qualified state residents to use Healthcare.gov to get their subsidies or if they have to use a government exchange “established by the state.”
More than 35 states did not create their own exchanges. In these states, subsidies are distributed through Healthcare.gov, which was created by the federal government rather than a state government.

WHAT’S AT RISK?

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If the plaintiffs win in King v. Burwell, health insurance subsidies received by millions of American consumers may come to a screeching halt. By on our calculations, this would result in an average increase of 255% in net monthly premiums for formerly-subsidized consumers.
eHealth takes no position on the legal merits of the King v. Burwell case. That’s for the experts to decide. We are concerned, however, by what a finding for the plaintiffs may mean for American families.
It’s easy to imagine that a 255% increase in premiums may lead to millions of consumers dropping their health coverage because it’s unaffordable.

IS THERE A FIX?

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Both state and federal governments will likely scramble to introduce a fix to the problem, but the partisan environment in D.C. today may make it hard to find a satisfactory solution.
At eHealth, however, we do have some ideas that may help consumers maintain access to affordable coverage, and help states to continue serving their citizens.
If you’re interested, we invite you to read a white paper eHealth recently published and an op-ed in Forbes penned by our CEO and Chariman, Gary Lauer. In these, eHealth outlines its vision for how a post-King market might begin to repair itself.
In short, we think that that states might find a solution by allowing private exchanges like eHealth to enroll consumers on their behalf. Left to their own devices, it could take states months or even years to create their own exchanges. We don’t believe consumers should have to wait that long.
The Supreme Court’s decision in the case of King v. Burwell is due this June.

We’ll let you know when we publish anything new.