Cases are rising, but more restrictions aren’t necessary
Of recent, Minnesota has been on the news, and not for a good reason – cases are rising in our state compared to most. For all its strict restrictions, Minnesota…
Today the Supreme Court held federal tax credits to fund health insurance coverage will continue to flow through thefederal health insurance exchange. The holding cements the ACA as the law of the land for the near term and puts the long-term future of the law back in the hands of the American people and who they elect.
The challengers in King v. Burwell had argued federal tax credits are only available through an Exchange established by a State and not an Exchange established by the federal government. The language of the ACA plainly states tax credits are only available to people enrolled in a health plan “through an Exchange established by the State.”
If they had prevailed, tax credits would not be available to people in the 34 states relying on a federal exchange. In addition, the employer mandate would not apply in these states and the individual mandate would apply to far fewer people. All of which would have substantially undermined the Obama administration’s implementation of the ACA and spurred Congress and the President to revisit key provisions.
As he did in the challenge to the individual insurance mandate, Chief Justice John Roberts found a way to save the ACA by rewriting the ACA. Remember, to save the individual mandate Roberts rewrote a “penalty” to be a “tax.” Today he rewrites an “Exchange established by the State” to read an “Exchange established by the State or the federal government.” As law professor David Bernstein laments, “So much for all legislative power being vested in Congress.”
Where does that leave us today?
First off, the “somersaults of statutory interpretation,” as Justice Scalia called them in his dissent, will stir even more distrust and dissension among the States against the authority and the legitimacy of federal government actions across a wide range of issues, including marijuana, immigration, environmental regulations, education, and even still the ACA. This will not be the last ACA case before the Court.
Second, the ruling will not save the ACA from itself. While the ruling shunts the need to revisit major ACA provisions in the coming months, it does nothing to save the law from the major faults that continue to make it very unpopular with the American people. Namely, the law does nothing to control rising health care costs. In Minnesota, a substantial portion of the individual insurance market is facing premium increases of more than 50 percent next year. This is not sustainable. The ACA is not sustainable.
Finally, though a ruling one way or the other does not immediately impact Minnesota—the state established an exchange and so tax credits were never at risk—the ruling will impact future state actions to address problems in our health care system. Most immediately, it opens a path to pull the plug on MNsure, the state’s very expensive and dysfunctional insurance exchange. With tax credits now undoubtedly available through the federal exchange, the state can choose to opt entirely for the federal exchange or form a partnership exchange.
But the ruling also tells Minnesota not to expect any fixes from the federal government any time soon, which should spur the state to take more immediate action, possibly through state innovation waivers that will be available in 2017. These waivers allow the state to modify and even eliminate certain ACA provisions, which could be a crucial tool to overcome at least some of the ACA’s problems and improve Minnesotans access to high quality, cost-effective health care.