Supreme Court Preserves Health Insurance Marketplaces

On June 25, 2015, the U.S. Supreme Court announced their decision upholding tax subsidies to help low- and middle-income people purchase individual health insurance plans through a federal health insurance marketplace. Chief Justice John Roberts wrote the majority opinion in the 6-to-3 decision.
The case focused on creation of a federal health insurance exchange that provides access to a health insurance marketplace, and tax subsidies, for qualified individuals in states that did not create their own state exchanges.
The Supreme Court made the right decision, preserving provisions of the Affordable Care Act that have been so crucial in providing access to more affordable health care coverage to millions of Americans. The court focused on interpreting the intent of Congress to create a health insurance marketplace for every eligible American, either through state exchanges or a federal exchange. Incentives for low- and moderate-income families to help make their insurance coverage more affordable was part of that intent.
Nationally, 85% of consumers who have used the exchanges to shop for health care coverage have qualified for subsidies to offset some of the cost of their individual health insurance policies. In 37 states, those consumers have accessed those subsidies through the federal exchange in one form or another. In 19 states the exchange available to residents was provided through a partnership in which the state used the federal exchange but retained varying degrees of exchange management.
The decision protects the progress we have made as a nation in providing affordable health insurance coverage for the millions of Americans who were uninsured prior to passage of the Affordable Care Act. Here in Nebraska, more than 57,000 people received tax credits to make their health coverage more affordable as of this year. More than 42,000 Montanans also received tax credits, as well as 6.5 million Americans nationally.
In Nebraska, the average monthly insurance plan premium, after tax credits, is $97 for individuals purchasing plans through the exchange. In Montana, after tax credits, the average monthly premium is $116 for policies purchased through the exchange. For 34 other federal exchange states the monthly premium after tax credits averages $272.
Clearly the ACA’s health insurance marketplaces are working, making health insurance more affordable for families that use the health insurance marketplace. Those individuals would have seen their premiums increase by nearly 450% in Nebraska, nearly 350% in Montana, and nearly 500% in the remaining federal exchange states if the Supreme Court decision had gone the other way.

Now it’s time to get on with providing affordable healthcare coverage for everyone and finishing the job of expanding Medicaid for the nearly 4 million low-income uninsured adults who fall into the “coverage gap” resulting from state decisions not to expand Medicaid. In our state, over 77,000 low-income Nebraskans fall into the Medicaid gap. In Montana, it is 69,000 people.

The Center for Rural Affairs released a policy brief today as well, Bottom Line: Medicaid Expansion in Nebraska. It shows that economic benefits from expanding Medicaid flow to families throughout the state and to the state’s economy as a whole. Medicaid expansion is a policy and economic winner for Nebraska and for those who would benefit from the health insurance coverage offered by it.

Feature image: A large crowd showed up at the State Capitol in Nebraska to lobby for the Medicaid Redesign Act, LB 472, which would expand Medicaid. Photo Center for Rural Affairs