Gov. Tom Wolf (D-PA)
The Department of Health and Human Services has
signed off on the applications of Arkansas, Delaware, and Pennsylvania to create their own state-based Obamacare exchanges ahead of a potential Supreme Court decision nixing premium subsidies to those states. The court will decide
King v. Burwell by the end of this month, and with it decide the fate of more than 6 million Obamacare customers in the states that use the federal exchange.
Letters from U.S. Health and Human Services Secretary Sylvia Burwell to Pennsylvania Gov. Tom Wolf and Delaware Gov. Jack Markell, both Democrats, and Arkansas Republican Gov. Asa Hutchinson say the approval reflects the expectation that the states' roles in the marketplaces will expand beginning in the 2016 policy year.
Right now, the federal government operates the marketplaces in about three dozen states, including Pennsylvania, while some states, including Delaware and Arkansas, are in charge of some functions. But plaintiffs in a lawsuit before the U.S. Supreme Court say the Obama administration is unlawfully providing subsidies to millions who buy insurance through the federally run marketplaces. If the court agrees, it could mean the end of the subsidies to most or all of those states.
Conversely, federal subsidies could continue to flow to states that run their own marketplaces, keeping insurance premiums lower. That is what helped compelled the applications by Delaware and Pennsylvania.
In a statement, Wolf said his state is "now in a better position to provide security to those who may lose their subsidies, and possibly, not be able to afford their health insurance." However, approval from the Republican-controlled Legislature would be required for any money needed to run a marketplace and potentially for the legal authority, and it is not clear where the body will stand on the issue.
There's always a rub when it comes to Obamacare, and that rub is always Republicans. They could easily torpedo the governors' efforts in Pennsylvania and Arkansas, just as they'll block efforts in many of the remaining 31 states on the federal exchange to fix the problem. That is, unless they grow hearts in the interim.
2:09 PM PT: As Charles Gaba notes, Arkansas' exchange will be operation in 2017, Delaware's and Pennsylvania's in 2016.