Steven Walters
The State of Politics

U.S. Supreme Court Case Threatens Health Care

Wisconsin and 34 states that didn’t set up health care exchanges could lose all coverage under Obamacare.

By - Jan 5th, 2015 10:25 am
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Former Health and Human Services Secretary Kathleen Sebelius and President Barack Obama.

Former Health and Human Services Secretary Kathleen Sebelius and President Barack Obama.

What would Wisconsin do, if the U.S. Supreme Court rules that the Affordable Care Act (ACA) — or Obamacare — doesn’t allow billions of dollars in tax credits and subsidies to go to residents of Wisconsin and 34 other states that didn’t set up their own exchanges to price and purchase health insurance?

Nothing, Republican Gov. Scott Walker said last week, because the problem would be too big for Wisconsin or – any one state – to try and fix. “It would create an urgent problem across the country – not just in Wisconsin,” Walker said in a interview with WisconsinEye.

If the Supreme Court ends ACA subsidies and tax credits in those 35 states, Walker predicted that his fellow Republicans who control Congress would “create a time frame for a transition” and authorize “alternatives for the states.”

Walker, who will decide within months whether to run for President, called the controversy one more example of how the ACA hasn’t worked and should be replaced with a “market-driven system where patients” make their health-care decisions. Obamacare has done “immense damage” to Wisconsin, where more than 90 percent of residents had health care before the ACA, the governor added.

The U.S. Supreme Court has agreed to rule on what ACA backers say was a technical error that could be easily fixed, if the new Republican-controlled Congress wanted it fixed.

The U.S. Supreme Court must answer this question: Does a provision of ACA only allow tax credits and subsidies, which help millions across the nation find health care, to be paid in states that set up their own marketplaces or exchanges? So far, Obama and Congress haven’t been able to fix any part of ACA since its 2010 passage. Instead, GOP leaders in Congress want to repeal ACA – a move Obama would veto.

While politicians bicker, health-care leaders in Wisconsin say that potential U.S. Supreme Court ruling would hurt many residents here. “It’s clear that’s not what was intended in Wisconsin and we’ll all have to find a way to address what could be an urgent problem,” says Eric Borgerding, president of the Wisconsin Hospital Association.

Borgerding says “thousands” of Wisconsin residents could lose health care, if the U.S. Supreme Court overturned ACA subsidies and tax credits in states like Wisconsin: “Politics aside, the simple fact is Wisconsin’s approach to coverage expansion, and achieving the goal of reducing the uninsured rate, relies heavily on a federal exchange and the subsidized premiums that go with them.”

He adds: “One of the key reasons many Wisconsin lawmakers ultimately rejected Medicaid expansion, and reduced Medicaid eligibility down to 100 percent of the federal poverty limit, is because those coming off Medicaid would be able to obtain subsidized coverage on a federal exchange. If that subsidy goes away, it will remove a significant element of Wisconsin’s unique approach to coverage expansion for low-income people and thousands will likely become uninsured.”

Bob DeVita, who founded Common Ground Healthcare Cooperative to help Milwaukee-area residents get coverage under ACA, agreed with Borgerding. DeVita left Common Ground in June. If the Supreme Court voids ACA tax breaks and subsidies, DeVita says: “Uninsured rates would rapidly increase across the nation in all states affected like Wisconsin, and the impact on individuals losing coverage would be both immediate and significant.

“This sudden, immediate impact on thousands of Wisconsinites and millions of individual American citizens would be so newsworthy it would likely receive major news exposure – similar to the media attention which a government shutdown gets,” DeVita adds.

DeVita says the resulting national backlash would force Republican leaders of Congress, even though they hate Obamacare, to fix the problem.

But Democratic legislative leaders say there’s a better solution, if the U.S. Supreme court puts ACA subsidies and tax breaks in jeopardy. Wisconsin should finally set up the state-based exchange authorized by the ACA, says state Senate Democratic Leader Jennifer Shilling, of La Crosse.

“The ‘go it alone’ approach from Republicans in Wisconsin has already cost taxpayers hundreds of millions of dollars and needlessly restricted health care access for thousands,” Shilling says. “Wisconsin families and businesses can’t afford to have the rug pulled out from under them again due to the stubborn inaction of Republicans in Madison.”

Steven Walters is a senior producer with the non-profit public affairs channel WisconsinEye. Contact him at stevenscwalters@gmail.com

 

5 thoughts on “The State of Politics: U.S. Supreme Court Case Threatens Health Care”

  1. Rich says:

    >>>> “Obamacare has done “immense damage” to Wisconsin, where more than 90 percent of residents had health care before the ACA, the governor added.” <<<<<

    What percentage has health coverage now? Without a comparable figure, I'm unable to substantiate "immense damage".

  2. Scott says:

    So the governor’s plan is to basically go back to a similar “market-driven” system as the one we’ve had for decades? The same one that everyone on both sides agreed was (and mostly, still is) a huge problem?

  3. Scott says:

    Also, any system where the choice of provider is decided en masse by the employer and not the insured individual is not what I’d call market-driven. Fix that problem first before considering going back to the same, already tried and failed, previous solution.

  4. Bruce Thompson says:

    Rich,
    According to Gallup, in 2013, 11.7% of Wisconsin residents lacked health insurance in 2013. This dropped to 9.6% in mid-2014. Presumably it has since dropped a bit more since, but I have not seen any newer estimates–and probably we won’t until some time after the end of the enrollment period.
    It appears that the governor confused the “after” figure with the one for before. The percentage decline for Wisconsin about equals the average for states that did not expand Medicare.
    I would say that Walker’s confidence that Congress would repair the wording if the Supreme Court ruled against the federal exchanges is good news, but given their antipathy to the ACA, I wouldn’t want to bet on it.

  5. Robert DeVita says:

    Hi Steve- I enjoyed reading your ACA piece. Many bets are being laid on the outcome of the Supremes June ruling.

    I did want to clarify two points. First, I was really not “the founder ” of the Common Ground Healthcare Cooperative…… maybe ” one of” since I did play a role first as a volunteer, then as CEO. But there was a core group of dedicated people who worked tirelessly as volunteers for years to birth the Coop.

    Second, Re: my comments about legislative remedies. When I emailed you last week in response to your question that I listen to your interview with Governor Walker and comment on his thoughts about congressional action ( see below ), I agreed with the Governor.

    Maybe the Governor will be wrong, in which case, so will I. It’s happened before !

    “The Governor’s comment is right about the likelihood of Congress needing to provide a legislative alternative if subsidies in states like Wisconsin disappear. Some analysts say that legislative remedies could be made as soon as Congress reconvenes since legislation is often modified after originally passed. In health care, this happened during George H. Bush’s administration when Congress acted to provide alternative language to Medicare Part D which took effect January 1, 2006.”

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