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The ACA Lives, and One CHI Report Dies

Somewhere inside the Colorado Health Institute’s computer server, there’s a paper I wrote that will never be published.It’s all about the King v. Burwell case on the Affordable Care Act (ACA), which the Supreme Court decided today in favor of the Obama Administration by a 6-3 ruling. Instead, we published a shorter paper on the ACA’s victory at the Supreme Court and what it means for Colorado.

The unpublished paper analyzed what would happen if the administration lost. Although Colorado would have been insulated from the most immediate effects of a decision against the ACA, we concluded that the fallout would affect us here.  No matter which side won, however, the top priority in Colorado wouldn’t change. More on that in a minute.

The King case centered on four words in the massive ACA. They said the subsidies that low- and moderate-income earners receive to buy health insurance are available on an exchange “established by the state.” Unlike Colorado, 34 states did not establish an exchange, and instead use the federal healthcare.gov insurance marketplace. More than six million people would have lost their coverage if the case had gone the other way.

Just like today’s Supreme Court opinion, our paper talked a lot about “death spirals.” It’s the term actuaries use to describe a likely outcome of removing subsidies without also repealing the prohibition on insurance companies discriminating against customers with pre-existing conditions. When insurance becomes unaffordable, actuaries say, only the sickest people will buy it. That leaves a risk pool filled with sick people, which forces carriers to raise their rates, which forces even more healthy people out of the pool, and so on.

But, of course, the Obama Administration didn’t lose, and we can stop talking about death spirals. By this afternoon, the case will seem like history, and people will be saying, “Hey, remember that time we were all worried the Supreme Court was going to overturn the ACA because of four little words?”

Now we can move on to the next pressing issue in health policy. In Colorado, that issue is the same no matter which side won the King case – the stability of our state health insurance exchange, Connect for Health Colorado. 

Had the plaintiffs won, Connect for Health Colorado would have been the golden ticket for people in this state to continue receiving subsidies, while residents of 34 other states lost theirs. A King victory would have made the long-term viability of the exchange doubly important. But even with today’s win for ACA supporters, the future of Colorado’s exchange is still highly important. 

The next few months will give Coloradans a lot to think about when it comes to Connect for Health Colorado. A legislative oversight committee is taking a hard look this summer at options to strengthen the exchange or wind it down. In September, the Division of Insurance will approve rates for 2016, providing crucial data on how competitive and consumer-friendly Colorado’s individual insurance market will be during the exchange’s third year. And at the end of the summer, the Colorado Health Institute will release the 2015 Colorado Health Access Survey. This will be the first detailed state survey of health access in the country since the ACA was implemented, and it will go a long way in answering whether the act is achieving its goals.

Today’s court ruling dispenses with the last major legal challenge to the ACA. There will be others, no doubt. But the King case cements the ACA as the law of the land. The task now, in Colorado and in Washington, is to make it work. And to ensure that health insurance leads to health care.