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Member Research and Reports

Member Research and Reports

BU Researcher: Supreme Court Ruling in ACA Case Could Have Drastic Consequences

There could be serious fallout if the Supreme Court sides with plaintiffs challenging an IRS rule that extends tax credits to 4.5 million people who bought their health plans in states that declined to establish their own health insurance exchanges, a Boston University School of Public Health (BUSPH) researcher and colleagues warn in The New England Journal of Medicine.

Dr. David K. Jones, assistant professor of health policy & management, and co-authors from the University of Michigan Law School and Washington and Lee University School of Law predict that if the IRS rule is invalidated in King v. Burwell, the 34 states that have declined to create their own exchanges under the Affordable Care Act (ACA) “probably won’t be able to stave off the immediate destabilization of (their) insurance market.”

“If the challengers prevail,” they write, “the U.S. Treasury will likely have to stop issuing tax credits to users of federal exchanges. Enrollees who are unable or unwilling to pay the full cost of their insurance premiums could see their coverage terminated, perhaps as soon as 30 days after they fail to make a payment.

“Those who retain insurance are likely to be sicker than those who drop coverage, which will skew the risk pools and expose insurers to large, unanticipated losses. Picking up the pieces would not be easy.

To read more about the findings, go to: http://www.bu.edu/sph/2014/12/11/supreme-court-ruling-in-aca-case-could-have-drastic-consequences