Last week the Supreme Court issued a landmark decision in King v. Burwell that further codified the Affordable Care Act (ACA) as the law of the land. At stake in this case was if states that chose not to operate their own insurance marketplaces would be able to provide insurance subsidies to low and middle income individuals. If the plaintiffs had prevailed in the case, two thirds of the states would not be able to offer tax credits to make health insurance coverage more affordable. Politically, it would have opened the door for Congress to make major changes to the ACA, possibly undermining key provisions of the law.
Regardless of how the court ruled, Vermonters would have been able to keep their subsidies because the state decided to set up our own insurance exchange, Vermont Health Connect. Vermont has made affordability of insurance a health reform priority, and we offer subsidies that go above and beyond what is offered by the ACA. These subsidies were a major point of contention in the 2015 legislative session, but thanks to the work of the legislature, VPIRG and other consumer focused organizations we were able to ensure Vermonters did not lose the assistance they rely on.
The ruling in the case hinged on the interpretation of a phrase buried deep in the ACA that says “exchanges established by the states” would be able to offer subsidies to individuals. The plaintiffs in the case contended that since the federal exchange was not established by one of the states it shouldn’t be able to offer subsidies. The court refused to adopt this interpretation, saying that it was the clear intention of Congress that individuals who bought insurance through the federal marketplace should be able to get subsidies. The court’s ruling allowed approximately 8 million across the country to keep their current coverage and subsidies.
This ruling is being applauded from across the country, especially in states where individuals had the possibility of losing their insurance subsidies. For more information on the King v. Burwell decision check out a quick analysis of the case and a review of what’s next for the ACA from our friends at Families USA.