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U.S. Supreme Court Upholds Subsidies in the Affordable Care Act

SCOTUS_King v Burwell

In a 6-3 decision issued Thursday, June 25, the Supreme Court ruled in the case of  King v Burwell that federal subsidies for people to buy insurance through the Affordable Care Act (Act) are constitutional.  The issue in the case was whether subsidies would only be allowed if the subsidies were given through exchanges that the states set up themselves.  Because 34 declined to set up their own exchanges and defaulted to the federal exchanges instead, the question was whether the provision of subsidies through the federal exchange was authorized by the Act.  According to Utah Policy, approximately 87 percent of enrollees in the federal exchanges receive subsidies to buy health insurance, or about 6.4 million people according to the Obama administration.  In Utah, 67 percent of Utahns who use the federal exchange will be able to keep their subsidies.

In writing for the majority opinion, Chief Justice John Roberts said, "Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them."

Subsidies are available to people who buy insurance on the exchanges and make between 100 percent and 400 percent of the federal poverty limit.  Without these subsidies, buying insurance would be unaffordable for most of these people.  The federal poverty limit for an individual is $11,770 and $24,250 for a family of four.

The following is a statement by AARP CEO Jo Ann Jenkins on today’s ruling by the U.S. Supreme Court:

“AARP applauds the U.S. Supreme Court’s King v Burwell decision today that allows individuals who purchased health insurance through the federal exchange to continue receiving subsidies to help pay premiums. The Affordable Care Act’s (ACA) goals of improving affordability and removing barriers to access for health insurance have been critical in reducing the number of uninsured Americans. Importantly, for older Americans, we have seen a 31 percent drop in the uninsured rate for those ages 50–64.

“The ACA has benefited millions of Americans and our economy by prohibiting insurance companies from denying coverage due to a pre-existing health condition, by closing the Medicare Part D ‘doughnut hole’, by limiting how much more insurers can charge older Americans, and by allowing adult children to stay on their parents’ health plan until age 26.

“AARP will continue working with members of Congress on both sides of the aisle to strengthen and improve the ACA and with state officials to implement the law’s provisions so that Americans of all ages have access to affordable health care.”

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