After the U.S. Supreme Court’s decision on the Affordable Care Act Thursday, Tucson insurance broker Raymond E. Magnuson had one reaction — a huge sigh of relief.
“Everything continues on as is,” said Magnuson, the owner of Magnuson & Associates. “There was so much anxiety going on. We were prepared for a deluge if the ruling was against the subsidies.”
Thursday’s ruling, which affirmed the Affordable Care Act’s health insurance subsidies to middle- and low-income Americans, means that the 126,506 Arizonans currently receiving the subsidies will continue to get them.
The average subsidy is $158 a month, and a ruling against the White House could have more than doubled some Arizonans’ monthly health insurance payments. Some health experts predicted that many of those people who currently have subsidies would have ended up going without health insurance altogether had their subsidies been cut.
“For those that would have been impacted, it could have been devastating,” Magnuson said.
The 6-3 decision applied to 34 states, including Arizona, that use the federal health exchanges set up via President Obama’s Affordable Care Act (ACA).
Other states, including California, Washington and Colorado, set up their own state exchanges and would not have been directly affected by the King v. Burwell case.
The plaintiffs had argued that the Affordable Care Act’s language specifies that health exchanges must be created by states and that the federal subsidies are allowable only in state-based marketplaces.
Had the justices ruled for the King side, Arizona faced some hurdles in setting up a state exchange.
The Arizona Legislature in the most recent session passed House Bill 2643, which makes it illegal for the state to use any personnel or financial resources to “administer, enforce or cooperate” with the ACA. The bill, which was signed into law by Gov. Doug Ducey, also says state money cannot be used for Arizona to create its own health exchange.
Responding to the high court’s ruling Thursday, Ducey spokesman Daniel Scarpinato wrote in an email that “the court has spoken.”
And while many health experts are hailing the King v. Burwell decision as a signal for the country to move on from divisiveness over the federal health law, Scarpinato wrote that Ducey maintains his long-held opinion that the ACA is “a rolling disaster.”
“It isn’t the right plan for Arizona or for America, and it should be replaced,” Scarpinato wrote.
Federal numbers show 205,000 Arizonans purchased insurance on the federal exchange in the most recent open enrollment, and that 126,506 of them, including 23,000 children, received subsidies in the form of tax credits paid directly to the insurance company by the federal government.
Families USA, a national nonprofit group, found that a total of 6.4 million Americans could have lost financial assistance with their monthly health insurance premiums.
In a study of individual congressional districts, Families USA found that 14,000 people in Rep. Raúl Grijalva’s 3rd Arizona Congressional District could have lost their health insurance subsidies, as could have 14,000 in Rep. Martha McSally’s 2nd District. Both districts include parts of Southern Arizona.
“I hope that with this decision, the Republican Party in Arizona and across the country recognizes the will of the American people to see this law stand,” Grijalva said in a prepared statement.
“The political decision of state lawmakers in Arizona to snub President Obama and this health-care law with House Bill 2643 threatened that right for too many Arizonans.”
McSally reacted with criticism of the ACA.
“While today’s ruling keeps intact subsidies under the law, the fact remains that the Affordable Care Act is fundamentally broken and hurting families across our country,” her statement says. “Southern Arizonans deserve a better answer to our broken health-care system, one that will put them first, and I’ll continue to work with my colleagues to give that to them.”
Tucson-based health policy expert Dr. Daniel Derksen said the decision will allow Arizona to move forward in encouraging more participation in ACA insurance.
Arizonans receiving subsidies through the marketplace represent just 38 percent of those estimated to be eligible, he said. By comparision, for example, Florida’s participation rate is 80 percent.
“We want to make sure people get covered.” said Derksen, a professor at the University of Arizona’s Mel and Enid Zuckerman College of Public Health. “Come Nov. 1 we have an opportunity to get well above 50 percent. Maybe we could draw on what Florida is doing.”
Derksen called the decision “great news for Arizona.” A ruling against the administration would have affected not only people with subsidies, but health care across the U.S., he said.
“I’m not going to come in on a parachute and say ‘mission accomplished,” Derksen said. “The partisan politics and litigation has continued — this (ACA) was signed in 2010 and here we are in 2015.”
Thursday’s decision represents what many experts say is the last major challenge to the federal law.
However, a pending lawsuit in Maricopa County, filed by a group of Republican Arizona lawmakers in 2013, could still affect health care in Arizona. The lawsuit seeks to overturn Medicaid expansion.
When Arizona expanded Medicaid in 2014, it not only raised the income limit to qualify, but also restored childless adults to the program, which is a government health insurance program for low-income people.
In Arizona the program is called the Arizona Health Care Cost Containment System (AHCCCS). Since December 2013, AHCCCS enrollment has increased by 365,129 Arizonans. People added to AHCCCS through Medicaid expansion could lose their coverage if the lawsuit is successful.
In a statement after the decision was announced, U.S. Health and Human Services Secretary Sylvia Burwell said she hopes the ruling will help “focus on the substance and turn to building on the progress we have made.”
The goal has always been to provide more Americans with affordable access to quality health coverage and create a system that improves the quality of care and spends dollars more wisely, she said.
