This is perhaps the most effective argument the Supreme Court, one hopes, considered while deliberating over
King v. Burwell, the case that could end Obamacare subsidies to customers in 34 states: taking that insurance away would
cause economic chaos.
Businesses that have benefited from spending by the newly insured would take a hit, though estimates of the lost revenues vary significantly based on which assumptions are built into the calculation.
For instance, a Kaiser Family Foundation economist put the 2015 figure at about $15 billion, based on the proportion of insurance premiums that are earmarked solely for medical costs under the healthcare law.
"There will absolutely be these second-order effects," said Larry Levitt, a senior vice-president and healthcare researcher at the Kaiser Family Foundation. "A reasonable assumption is that (spending on) healthcare by people who lose their existing subsidies will drop by at least half." […]
Another rough estimate based on 2014 medical claims data and 2015 government enrollment data, suggests the federal marketplace states will see about $22 billion in healthcare spending this year among Obamacare plan holders assuming subsidies remain in place, according to Katherine Hempstead, a director at the Robert Wood Johnson Foundation. The majority of Obamacare members receive subsidies.
Hospitals would be particularly hard hit, losing about $6.3 billion in revenue according to an
Urban Institute study. Since many of these hospitals are in the states that also refused Medicaid expansion, that would be a double-hit, because there have already been big reductions in federal support for hospitals as part of Obamacare. That funding was cut on the assumption that Medicaid expansion would make up for the cuts because hospitals would be having to cover much less charity care, before the Supreme Court decided to gut that. Having to provide coverage for even more uninsured people could cripple many of these hospitals.
What's not being calculated here is the potential for job losses and the extent of that hit to the economy. The hospital sector alone gained more than 100,000 jobs in the last year. The repercussions of what more than six million people losing health insurance will be big. Very big. The repercussions of what Republicans would do in response would be even worse.