A bill before the Maine Legislature would protect residents who buy health insurance under the Affordable Care Act from losing the subsidies that make coverage more affordable if the U.S. Supreme Court rules that many states are ineligible for them.
Plaintiffs in King v. Burwell argue that the wording in the Affordable Care Act precludes states that did not set up their own marketplaces from receiving federal subsidies. Attorneys for the Obama administration counter that it was merely a technical glitch in the law, and that the intent of Congress was to provide subsidies to all states. The health care law allows states to choose whether to operate their own marketplaces or have the federal government do it. A decision in the court case is expected this summer.
If the Obama administration loses the case, lower-income residents in 37 states – including Maine – that chose to let the federal government run their insurance exchanges could lose the subsidies.
The bill sponsored by Rep. Linda Sanborn, D-Gorham, would create a state-based insurance exchange that would keep the state eligible for the subsidies no matter which way the court rules.
Nearly 90 percent of the 75,000 Mainers who purchased insurance on the federal exchange earn 100 percent to 400 percent of the federal poverty limit, up to $95,000 for a family of four, making them eligible for the subsidies. Subsidized premiums can be as little as $10 per month, but typically are $50 to $100 per month.
The LePage administration, which opposed creating a state-based exchange, has not stated a position on Sanborn’s bill. It has also not said whether the state would take steps to help Mainers who can no longer afford insurance if the court rules that Maine no longer qualifies for subsidies.
The administration’s only response to questions on the matter has been to indicate that Attorney General Janet Mills, a Democrat, has joined a friend-of-the-court brief urging a ruling to keep all states eligible for the subsidies. The administration has not indicated whether LePage supports Mills’ position.
Sanborn’s bill has attracted bipartisan support, including from Sen. Roger Katz, R-Augusta, and Rep. Karen Vachon, R-Scarborough. A public hearing was held Thursday before the Insurance and Financial Services Committee.
Sanborn said bill sponsors made their case to the administration. She said she doesn’t know whether LePage intends to back it, but is encouraged by the legislative support.
“I’m very hopeful,” Sanborn said.
If the bill becomes law and the state exchange is created, customers wouldn’t notice a change in their insurance coverage and subsidies for low-income customers would remain the same, said Kevin Lewis, chief executive officer of Maine Community Health Options, an insurer on the marketplace. Lewis helped craft the bill.
Lewis said the bill would head off an “emerging crisis” should the Supreme Court rule against the government. Lewis said creating a state-based exchange wouldn’t carry any additional costs.
“It’s a simple and yet effective solution to something that might occur,” Lewis said.
At least nine states using the federal exchanges have pending legislation to convert to state-run marketplaces, in case the court rules to eliminate subsidies in the federal exchanges .
A bill proposed by Wisconsin Republican Sen. Ron Johnson would preserve the ACA tax subsidies available through the federal exchange through August 2017, after the 2016 election.
Sanborn said if the state does not protect itself, the Supreme Court decision could hurt families. “They’re going to lose the young, healthy people from these plans, and premiums would go up for everyone,” she said.
Send questions/comments to the editors.
