Document Type

Article

Publication Date

4-2015

Abstract

If the Supreme Court rules against the government in King v. Burwell, insurance subsidies available under the Affordable Care Act (ACA) will evaporate in the thirty-four states that have refused to establish their own health-care exchanges. The pain could be felt within weeks. Without subsidies, an estimated eight or nine million people stand to lose their health coverage. Because sicker people will retain coverage at a much higher rate than healthier people, insurance premiums in the individual market will surge by as much as fifty percent. Policymakers will come under intense pressure to mitigate the fallout from a government loss in King. But the Republican-controlled Congress has already ruled out a surgical fix, and recent reporting suggests that Congress will be hard-pressed to develop an alternative reform proposal that could meet with the White House’s approval. Even a temporary extension will meet with fierce resistance from legislators who will see an extension as a tacit concession that the subsidies, in some form, are here to stay. All eyes will turn to the Obama administration and to the states. Yet public debate about their post-King options has been limited. Part of the reason is strategic: the government’s supporters fear that discussing fixes might signal to the Supreme Court that eliminating the subsidies would not do much damage. The Obama administration, for example, has declined to tell Congress whether it even has a contingency plan. And while the ACA’s opponents suggest that the King aftermath might not be so bad, they have generally declined to endorse specific fallback plans. In this Essay, we take a hard look at some potential options available both to the administration and to the states to mitigate the fallout of a government defeat in King. Some are straightforward and noncontroversial; others will face intense political resistance and press up against legal boundaries. Taken together, we believe these options might enable policymakers to moderate, at least somewhat, the consequences of a government loss in King.

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