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“There’s been an awakening…have you felt it?”
Caution: You’re re-entering Mark’s geek zone!
My mom likes to remind me from time to time of one of those “moments” I had growing up. It goes like this: It’s the summer of 1980. I’m an excited 10 year old in line to see what is to this day my favorite film of all time*. I don’t remember saying this, but she says I told her to keep me calmed down, so I could enjoy the movie. She likes to think I was wise beyond my years. Maybe and maybe not, but I do remind myself of it frequently because it’s easy for me to get overly excited or worked up over something. In the compliance arena, that can be problematic.
This spring, the Supreme Court is going to hear arguments in the current major legal challenge to the ACA. It’s the citizens versus the administration, and at stake is the very future of the ACA. Many pundits agree: a ruling against the administration would be the undoing of the entire ACA.
“The Dark Side…”
The prospect is there. The statute clearly states that subsidies are available for individuals enrolled in Exchanges “established by the state.” Only a handful of states chose to establish their own Exchanges; most opted out. Read plainly, the ACA’s subsidies aren’t available in those states. Take them away, and employers don’t have to worry about the employer mandate (no employee can qualify for a subsidy, so there are no employer penalties). More problematic, the whole purpose of the ACA is to make coverage affordable and available to low-income people who previously didn’t have access to coverage. Without subsidies, there’s no way to make it affordable. The ACA would implode and cease to function.
Here’s where it’s important to remain calm. There are a lot of people out there that would, to put it mildly, support this outcome. I won’t take a side here – but I will offer this one caution: stopping the ACA in its tracks is going to have some pretty drastic consequences for the employer group market. It’s easy to forget just how many changes to the insurance market the ACA has made completely outside of the employer mandate. If the ACA were to just vanish, the immediate fallout could be cataclysmic. We’ll deal with that in a future blog post.
“And The Light…”
For now, my prediction: the Court will decide against the Administration, but defer their decision to give states time to determine whether they really do want to opt out of the Exchange system. And that will give the ACA’s ultimate fate back into the hands of the people it probably should be in – that is, the citizens of the several states. That will slow things down significantly, and with that time, people will be able to remain calm, and figure it out.
* December 18th. I will be in line. Will you? If you are, you may need to help keep me calm. (Figure out the movie yet?)
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