Republicans, and the plaintiffs in the
King v. Burwell case,
want to convince the U.S. Supreme Court that striking down the federal subsidies for all the people getting health insurance through the federal health insurance exchange under Obamacare wouldn't really do much harm. A
new study from the nonpartisan RAND Corporation think tank says otherwise, finding that 9.6 million people would lose their coverage if their subsidies were taken away.
In addition, unsubsidized individual market premiums would rise by 47 percent in those states. The hike would correspond to a $1,610 annual increase for a 40-year-old nonsmoker who purchased a silver-level plan.
"The disruption would cause significant instability and threaten the viability of the individual health insurance market in the states involved," said Christine Eibner, the study's senior author and a senior economist at RAND, a nonprofit research organization. "Our analysis confirms just how much the subsidies are an essential component to the functioning of the ACA-compliant individual market."
Enrollment in the 34 states that are using the federal insurance exchange would drop from 13.7 million people (their projection for enrollments at the end of 2015's open enrollment period) to 4.1 million, they estimate. But that's not all, as "premium costs for a 40-year-old nonsmoker purchasing a silver plan would be expected to rise from $3,450 annually to $5,060." That's simply not sustainable, not for the individuals needing insurance or for the whole system.
The King plaintiffs charge that the law as written—and intended by Congress—only allows subsidies to people who enrolled in the now 16 states which created their own health insurance exchanges under the law. The law's authors, the journalists who followed the law from its inception through the legislative process and numerous advisers and consultants disagree. Now it's up to the Supreme Court to make what could be a calamitous decision.