Supreme Court upholds subsidies in King v. Burwell

So what does this mean?

For those of you how haven’t been following this issue let me start with what this case was about.

When the Affordable Care Act was originally written, the thought was that all of the states would manage their own exchanges. In reality that is not what happened. There are currently 34 states who do not operate their own exchanges and rely on the federal exchange to provide coverage to their constituents.

Those who have been challenging the Affordable Care Act found a part of the law that would have completely undermined the intent of the Affordable Care Act. The part of the law that they challenged was that it was written that subsidies are only available to those who enrolled in a state exchange. According to them, those in the 34 states who enrolled in plans through the marketplace would not be eligible for the subsidies that made coverage affordable. It’s estimated that it would be about 6 Million people who could have been affected by this.

Today the Supreme court voted 6-3 to uphold the subsidies and the interpretation of the Internal Revenue Services that individuals in all 50 states should be able to access these subsidies.

Vote Breakdown:

Roberts filed the opinion with Kennedy, Ginsburg, Breyer, Sotomayor, and Kagan joining

Scalia filed a dissenting opinion with Thomas and Alito joining

The decision was based on the fact that they had to read the law in context and not just plain language. It was determined that in context the words “an Exchange established by the State under [42 U. S. C. §18031]” is ambiguous. Due to the ambiguity, the Supreme Court had to look at the phrase in the greater context of the Act. They also found that other parts of the law would not make sense if this phrase was defined as plain language.

When looking at the greater context of the Act the Supreme Court had to reject the interpretation of the petitioners because “it would destabilize the individual insurance market in any State with a Federal Exchange, and likely create the very “death spirals” that Congress designed the Act to avoid”.

It would have removed the subsidies from the states that didn’t operate their own exchanges and many of those individuals would have been exempt from the coverage requirement because the insurance would not have been affordable. These two facts would have also had a negative impact on the state exchanges as well since they would have struggled to operate in this environment.

So why should we care? Michigan is one those states that participated in the federal exchanges. As some of you know American Indian Health and Family services has played an important role in enrolling both tribal members and non-tribal members through the Marketplace and Healthy Michigan. If the Supreme Court had not upheld the subsidies, most of the individuals that we enrolled in the marketplace would no longer be able to afford coverage and would become uninsured again.

If you would like to read the filing please visit here

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Facts about the Individual Shared Responsibility Provision

Facts about the Individual Shared Responsibility Provision

I know its been a while since I have posted on here. We have been really busy here at AIHFS with the end of the enrollment period for most people in March and open enrollment of the expanded Medicaid (Healthy Michigan) program. I wanted to share this link with everyone in case you still have questions about the shared responsibility provision of the Affordable Care Act and what it means to you. Remember if you have any questions please give us a call or email as at hbenefits@aihfs.org

Family eligibility for tax credits if you are eligible to enroll in a job-based plan

We have been getting a lot of questions from families where the employer does offer family coverage, but it is often too expensive. Because the employer plan is too expensive, many families are looking to shop in the Healthcare Marketplace (www.healthcare.gov). Even though they are eligible to purchase a plan they are often not eligible for tax credits unless the employee only cost (not the family cost) is more than 9.5% of the family income . This is why some companies are looking at dropping their family coverage. They are starting to recognize that there plans are too expensive for family members and know that families can often get a much better deal through the marketplace if they are eligible for tax credits. If you are one of these families, I encourage you to talk with your employer and see if it is an option to not cover families. Below is some guidance from CMS on the specifics:

Q: Are families eligible for Marketplace tax credits if they are eligible to enroll in a job-based plan that is offered to an employed family member?

A: As explained in greater detail below, the answer depends on whether the job-based plan is considered “affordable” and meets “minimum value.” Employers that offer job-based health coverage for an employee’s family members usually, but not always, pay part of the family’s premiums. If a family chooses an individual health insurance Marketplace plan instead, the employer doesn’t contribute to premiums. Consumers should consider this carefully before comparing Marketplace plans. If a consumer with an offer of employer-sponsored family health coverage decides to shop for Marketplace plans for his or her family, be aware that he or she may not qualify for tax credits (and cost-sharing reductions), even if their household income would otherwise qualify them for financial assistance.

Whether a consumer and/or the consumer’s family members will qualify for tax credits based on income will depend on the coverage the employer offers. A consumer and/or family member won’t be able to get lower costs if the job-based coverage is considered affordable and meets minimum value.

What is considered “affordable?”
A job-based health plan is considered “affordable” if the employee’s share of premiums for the lowest cost self-only coverage that meets the minimum value standard is less than 9.5% of their family’s income.

In other words, if a consumer’s share of premiums for a plan that covers only that person (as the employee)–not his or her family–is less than 9.5% of the family’s income, the plan is considered affordable.

The consumer may pay more than 9.5% of his or her family’s income on premiums for spouse or family coverage from the job-based plan. But affordability is determined only by the amount the employee would pay for self-only coverage from the employer.

For more information, please refer to https://www.healthcare.gov/what-if-i-have-job-based-health-insurance/.

What is the “minimum value” standard?
A health plan meets the minimum value standard if it’s designed to pay at least 60% of the total cost of medical services for a standard population.  In other words, in most cases the plan will cover 60% of the covered medical costs and the person with coverage pays 40%.

A consumer should ask his or her employer for help figuring out if the plan offered meets the minimum value standard. The employer can also give the information needed to determine if the plan is considered affordable.

One way to gather this information is by asking the employer to fill out an Employer Coverage Tool (available here).

 

So What Now? Government Shutdown, ACA open enrollment

So What Now? Government Shutdown, ACA open enrollment

So this  is a big week, and I know that there are a lot of questions. I’ve been posting a lot about Affordable Care Act and reminding everyone that open enrollment was coming soon. IT’S HERE! 

Okay but there are some complications. If you have visited http://www.healthcare.gov , you may have noticed that it is hard to get in and there are so many other glitches right now. The best I can say is that we have no answer for when things will be fixed. The good news is that we still have a lot of time, so we just need to be patient right now. If you have an appointment scheduled with us for assistance in the next two weeks we will keep you updated. We are testing the site on a daily basis and contacting our appointments if we need to reschedule.

Other questions about ACA that have come up are in regards to the government shutdown. 1) The marketplace still opened on October 1st. 2) You can still sign up for insurance even through the government shutdown.

There have been many other questions and concerns regarding the government shutdown. As an organization that is funded from many federal agencies we have been following this issue closely. At this time the biggest message that I want to share is that we are open and fully operating. None of our staff are furloughed. We are working with each of our funding sources to determine the exact impact on our funding, but are confident that we will not have any major negative impacts at this time. The biggest impact is that some of the grant management staff at the government level are furloughed which can make it a little more difficult to get questions answered when we have them.

As the government shutdown continues, we will updated you, but I mostly wanted to share with you the impact on AIHFS and to share that we are still open and have no indication that our services will be impacted.

If you want to do some reading or have specific questions about the shutdown you can visit http://www.usa.gov/shutdown.shtml or you can call 1-800-FED-INFO (1-800-333-4636)