Hospitals urge Supreme Court not to strike down premium subsidies

Don't touch taxpayer premium subsidies.

That was the unambiguous message the American Hospital Association (AHA) and Federation of American Hospitals--and by extension, thousands of acute care providers--sent to the U.S. Supreme Court in the form of an amicus brief regarding the King v. Burwell case.

The case hinges on whether the language in the Affordable Care Act (ACA) meant Congress restricted the granting of tax subisidies to reduce premiums only to those residents of states that set up their own health insurance exchanges, as opposed to states that used the federal exchange. The high court will hear arguments on the case later this year.

The brief, co-authored by AHA general counsel Melinda Hatton, is clear about what the impact would if the court ruled against preserving all premium subsidies, AHA News Now reported.

It "would be a disaster for millions of lower- and middle-income Americans ... the ACA's subsidies have made it possible for more than 9 million men, women and children to have healthcare coverage--some for the first time in years; some, no doubt, for the first time in their lives. That coverage allows them to go to the doctor when they are sick, and to do so without fear that the resulting bill could leave them in financial straits. If Petitioners' interpretation is accepted, however, that salutary development will be reversed. The ranks of the uninsured will swell again, with all that portends in the way of untreated illness and overwhelming debt."

Although the ACA has had an uneven impact on covering Americans, it has greatly reduced the amount of uncompensated care provided by hospitals. It is estimated that hospitals have cut their uncompensated care expenditures by $5.7 billion, according to a recent report by the U.S. Department of Health and Human Services, although the large majority of that has been in states that have expanded Medicaid eligibility. Since many states that rely on the federal exchange have also been resistant to the ACA, a high court decision hostile to the subsidies will likely magnify that gap.

The brief also asked that if the Supreme Court strikes down subsidies, it provide an implementation window in order for Congress to pass a legislative fix. However, some industry observers believe the 34 states that rely on the federal exchange could individually intervene to address the issue, FierceHealthPayer has reported.

To learn more:
- read the AHA News Now article 
- check out the amicus brief (.pdf)