Health Care Reform Offers Something Old, Something New for People With Special Needs
Although it took more than a year of back and forth, a comprehensive health care reform bill and an associated reconciliation...Read more
In a 6-3 decision, the U.S. Supreme Court has upheld a key provision of the Affordable Care Act, making it likely that the universal health insurance law passed in 2010 will remain intact for the foreseeable future. The court's decision is welcome news for many people with special needs who enjoy a host of benefits because of the Affordable Care Act (aka “Obamacare”) and who were at risk of losing coverage if the Court had ruled differently.
Under the Act, states have the option to create health insurance exchanges where people who do not receive insurance through other channels can purchase it. If a state chooses not to create an exchange, an uninsured person living in that state can obtain insurance through a federal exchange instead. Thirty-four states have not set up their own exchanges, leading millions to buy their health insurance from the federal exchanges.
In order to make this mandatory insurance affordable, the federal government provides tax credits to people who purchase their insurance through an exchange if they meet certain income requirements. Without the credits, insurance premiums for these customers would be much higher. Unfortunately, the final text of the Affordable Care Act stated that tax credits would only be provided to consumers who purchased insurance through "an Exchange established by the State . . ." The IRS issued a regulation applying this phrase to anyone who purchased insurance through any exchange, be it a state exchange or a federal one, but a group of plaintiffs sued the IRS, claiming that the plain language of the statute only allowed tax credits for people who bought insurance through a state exchange. If the plaintiffs had succeeded, millions of people living in the 34 states without state exchanges would probably have lost their insurance coverage.
The Supreme Court decided that this interpretation of the law was incorrect. Writing for the majority, Chief Justice John Roberts said that "Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them.” If the credits were eliminated, this "could well push a State’s individual insurance market into a death spiral. It is implausible that Congress meant the Act to operate in this manner." Because of the court's ruling, people who purchase insurance through the federal exchanges will still be able to qualify for the tax credits, unless a future Congress changes the law.
The ruling is significant for those with special needs and their families because under the Affordable Care Act, insurers cannot refuse to insure people with pre-existing medical conditions, mental health coverage must be covered like any other medical treatment and children may remain on their parents' insurance policies until they turn 26. If the court had ruled the other way in this case, all of these provisions would have remained intact, but people living in the 34 states without exchanges would not be able to take advantage of them because they likely would not be able to afford to purchase insurance at all.
To read the full text of the court's decision in King v. Burwell, go to: https://www.supremecourt.gov/opinions/14pdf/14-114_qol1.pdf