Springfield News-Leader - Challenge to health care subsidies could mean a new headache for GOP

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By: Deirdre Shesgren

Sen. Roy Blunt hopes the Supreme Court eliminates the health care subsidies flowing to people in Missouri and more than 30 other states under the Affordable Care Act.

Blunt, R-Mo., and other GOP lawmakers see the legal challenge the court is considering as a potentially sweeping victory in their long battle to unravel Obamacare.

But a ruling against the subsidies -- oral arguments in the case will be heard Wednesday -- would leave millions of Americans, including more than 200,000 in Missouri, scrambling to afford insurance purchased through the federal government's health care exchange.

It also would create a new political headache for Republicans in Congress: Do they come to the rescue of a law they despise or risk letting the insurance marketplace go into a "death spiral," as some have warned might happen?

"Congress will have pressure to do something about that," said Ed Haislmaier, a senior health policy research fellow at the conservative Heritage Foundation in Washington. "The question will be, what?"

Blunt said Republicans won't be caught flat-footed. He said he's been working behind the scenes on a possible proposal to fill the void if the Supreme Court rules in the GOP's favor.

But Republicans have failed for years to unify around a comprehensive health care plan. And it's unclear if they can do so before a Supreme Court ruling on the subsidies, which could come this spring.

The challenge to the subsidies, in a case called King v. Burwell, centers on a few words in the 900-plus page Affordable Care Act. The law says the federal subsidies -- which come in the form of tax credits based on income -- can be offered through a health care exchange "established by the state."

Blunt and others say that means only consumers who purchase insurance through a state exchange, not the federal exchange at HealthCare.gov, are eligible for the subsidies.

The Obama administration's policy of giving tax credits to patients with insurance purchased at HealthCare.gov is "unambiguously inconsistent with the law," Blunt and other Republicans wrote in a December letter to the administration.

Supporters of the Affordable Care Act say its authors in Congress never intended to prevent federal subsidies from flowing through the federal exchange.

The fight over semantics has significant implications in Missouri and 33 other states that declined to set up their own online health care exchanges. State legislators in Jefferson City passed legislation barring Democratic Gov. Jay Nixon from setting up a state exchange, forcing Show-Me State residents to use HealthCare.gov to shop for insurance and possibly qualify for a tax credit.

So far, more than 200,000 Missourians have used the federal exchange to buy insurance, with about 88 percent receiving a tax credit to lower the cost of their plan. Sen. Claire McCaskill, D-Mo., said Republicans in Jefferson City and Washington will shoulder the blame if those people lose their insurance.

"They need to get over their trying to score political points on health care reform and... get busy worrying about what Missourians are going to do if they are successful in denying them the subsidies," she said.

Both sides agree that a Supreme Court ruling saying the subsidies are invalid would blow a huge hole in the law.

"If premium subsidies are withdrawn from moderate-income people in approximately three-dozen states, the impacts would be severe," Ron Pollack, executive director of the liberal consumer group Families USA, wrote in in a recent analysis of the case. "Many millions of people would rejoin the ranks of the uninsured, premiums would increase enormously, and the non-discriminatory protections for people with pre-existing health conditions would be jeopardized and would probably become ineffective."

Health and Human Services Secretary Sylvia Mathews Burwell said this week that a ruling against the subsidies would do "massive damage" and the White House would be unable to step in with a fix.

"We know of no administrative actions that could -- and therefore we have no plans that would -- undo the massive damage to our health care system that would be caused by an adverse decision," Burwell said in a letter to Congress.

Megan Hauck, a health care lobbyist and former aide to Senate Majority Leader Mitch McConnell, said there's a political risk for both parties if they fail to come together to craft a response to any Supreme Court decision that kills the subsidies.

"People need to recognize that... these are real people's lives," she said. "These are real people with health concerns and sick kids who are scared, who are hoping that someone in Washington cares more about them than about making a political point."

Haislmaier, the Heritage Foundation researcher, said the case should be viewed an opening for Republicans to revamp the law.

"It's an opportunity to revisit a lot of the over-regulation on the insurance side and undue complexity… of the subsidy design," Haislmaier said.

McCaskill agreed a Supreme Court ruling in the GOP's favor would offer a chance to fix flaws in the law. In that case, she said, it would be up to Republicans, who have spent years pillorying the Affordable Care Act, to come up with a new plan.

"They've been saying 'repeal and replace' for four years," she said. "Where is replace?... This would be the time to show us."

Blunt said Republicans will have a backup plan.

"I'm in a meeting at least once every week now to figure out what the alternative might be," he told Missouri reporters on Wednesday.

He noted that he is a sponsor of legislation that would repeal the Affordable Care Act and give Congress six months of transition time to come up with a different way to fix the health care system's ills.

"There are plenty of things that can be done here that create a more resilient, competitive, private system where people get the insurance that they want to meet their families' needs," he told a radio reporter in Missouri earlier this month.

But so far, Republicans have talked more about what they won't do than about what they will do. Earlier this month, for example, Wisconsin GOP Rep. Paul Ryan, chairman of the House Ways and Means Committee, suggested that the easiest fix -- passing legislation clarifying that subsidies can go to people who buy insurance through the federal exchange -- is a nonstarter.

"The idea is not to make Obamacare work better or to actually authorize Obamacare," Ryan said, according to the Hill, a Washington newspaper.

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