Thursday, June 25, 2015

Supreme Court Rule 6-3 in Favor of Federal Subsidies

Today’s Supreme Court ruling favoring federal subsidies assures ObamaCare survival until the 2016 election and beyond. The decision is a political victory for the Obama administration and a defeat for Republicans who sought to gut the law or repealed.

What does the ruling mean?

It means the Court has now ruled twice, the first time in 2012, that ObamaCare is constitutional.

It means liberals will be pleased and conservatives displeased with the decision.

It means hospitals will be pleased because some of the uninsured hospital expenses will now be paid.

It means institutional federal laws giving a legal right to health care - Medicare (1965) Medicaid (1965), Emergency Medical Treatment and Active Labor Act (EMTALA 1986) Children’s Health Insurance Program (CHIP1997), and Patient Protection and Affordable Care Act (ACA2010) – will continue to consume more federal dollars.

It means federal entitlement programs will continue go grow, as they have over the last 50 years.

It means that the 6.7 million Americans on federal subsidies will continue to receive $3,312 per recipient per annum or $222 billion in all. More people will be subsidized to consume health care at middle class taxpayer expense.

It means hospitals, which heretofore had to absorb costs of the insured who could not afford care, will have a new source of federal revenues.

It means less uncertainty for health plans, who feared a death spiral and other disruptive effects if the Court had ruled against federal subsidies
It means those unpopular individual and employer mandates will remain in place.

What the ruling not mean?

It does not mean the controversy over the law has ended. It will continue through the 2016 elections.

It does not mean that the law is working as intended. Yes, it reduced the number of uninsured by 16 to 17 million out of 50 million. Yes, it helped 6.7 million uninsured and low income people below 4 times the poverty rate, less than 3% of the population.

But it may not help the middle class, who in 2016, are projected to see their health premiums, deductibles, co-pays, and out of pocket costs soar by 10% to 30% and who may see their plans cancelled and their doctors and hospitals declared out-of-network.

And it does not mean America’s uninsured will jump on the health exchange bandwagon. According to a survey sponsored by the Robert Wood Johnson Foundation, 38% of insured get their medical care by paying out of pocket, 28% us fee-low-cost clinics, 26% go without care, 20% buy discount medications, 14% use the ER, 9% negotiate their bills down, and 4% go to another country for care.

The largest group of people who remain uninsured, 45% of them, forego coverage by choice, even though the law guarantees them they can get coverage on their own or through a job.

Many of the uninsured are confident they can get their care cheaper and manage it better without health insurance: 56% on doctor visits, 53% on prescription drugs, 52% on checkups, 48% on emergency care, and 42% on preventive tests or screening. Many Americans, in short, are getting their care the old-fashioned way – cash, barter, or charity. They believe they can get a better deal without insurance. They prefer to pay ObamaCare’s penalty mandates rather than enroll in Obama Care sponsored and approved health plans

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