King v. Burwell Decision Upholds ACA Tax Credits
On Thursday, June 25, 2015, the United States Supreme Court issued its long-awaited opinion in the King v. Burwell case. For many, this case presented a “make or break” situation for the Affordable Care Act (ACA). At issue in the case were the ACA’s premium tax credits, which reduce the premium amounts for almost 90% of all individuals who have purchased health insurance through the “Exchanges.” Nationally, that’s about 11.7 million Americans, according to the Wisconsin Council on Children and Families.
The Supreme Court of the United States, or as some fondly refer to it, “SCOTUS,” concluded in a 6-3 decision that these premium tax credits would continue to be available in exchanges operated by the states (of which there are about a dozen), as well as in states whose exchanges are operated by the federal government (of which there are 34 states). SCOTUS interpreted the language in the ACA that says premium tax credits are available to individuals enrolled in an insurance plan through “an Exchange established by the State” to encompass both federally-operated and state-operated exchanges. The challengers to the ACA language argued that read literally, the language limits premium tax credits to state-operated exchanges only.
Chief Justice John Roberts wrote the majority opinion and rather than deferring the interpretation of the ACA language to the Internal Revenue Service, the federal agency charged with enforcing the tax credit provision, the majority interpreted the language themselves. By doing this, the Court eliminated any chance that a future administration would alter the interpretation and restrict premium tax credits to state-operated exchanges only. As a result of the Court’s decision, any chance of decimating the ACA will most likely have to come in the form of legislation, not the courts.
What Does the Decision Mean for Healthcare and Wellness Professionals and Organizations?
At least while President Obama is still in office, the Court’s decision in King v. Burwell means that the threats to the ACA will mostly disappear. The national uninsurance rate is likely to continue to fall because the ACA requires individuals to buy health insurance or face a penalty on their taxes and helps them afford health insurance through the premium tax credits. Fewer uninsured also means health care providers will have less uncompensated care.
With more Americans covered by health insurance, health and wellness providers should seize the opportunity to educate their patients and clients about leading healthy lives. As Americans become more invested in the health system, it should be a goal for health and wellness providers to leverage this American investment by helping them achieve healthier outcomes and understand the patient’s role in the overall health system in terms of achieving greater health quality and lower health cost.
The Court’s decision also means that the next Presidential election will be critical to the fate of the ACA. As mentioned above, any chance of significantly altering or repealing the ACA will happen through our elected officials. As a result, it will be important for health and wellness professionals to understand the positions of candidates regarding the ACA and vote accordingly in the 2016 election.