King v. Burwell: Private Exchanges Can Provide a Solution for Consumers and States If Supreme Court Deems Federal Exchange Subsidies Unlawful
A decision in the case is expected later this spring and a finding for the plaintiffs (those arguing the regulations are illegal) may have a dramatic impact on the future of the Affordable Care Act (ACA), on the national health insurance market, and on the lives of millions of consumers. If the Court rules for King, health insurance markets in the 37 states currently served by Healthcare.gov will likely enter a period of crisis. At some time following a decision for the plaintiffs in King v. Burwell, the
In its white paper, eHealth proposes legislative action at the federal level to both address the needs of consumers and relieve state governments of the burden and risk of building and launching their own state-run exchanges. eHealth's proposal would create a private market-driven solution to the problem, allowing states to leverage the technical competencies and marketplace expertise of existing web-based agents and brokers to establish and run state-recognized "private exchanges." Unlike their state counterparts, existing web-based agents and brokers already have the systems and knowledge in place to efficiently operate such exchanges. eHealth's proposed solution would permit states to certify private exchanges both to enroll individuals in health plans and to assist individuals in applying for subsidies (in the form of premium tax credits and cost-sharing reductions) for health plans sold through the private exchange.
Key features of eHealth's proposed legislative solution would include the following:
- Within 90 days after the enactment of the law, states previously served by Healthcare.gov will notify the Secretary of
Health and Human Services whether they intend (1) to certify one or more private exchanges for operation in the state; or (2) to operate an American Health Benefit Exchange alongside one or more private exchanges certified by the state. In either case, consumers would have the option of using a tax credit to which they are entitled while enrolling in a health plan through a private exchange. - Private exchanges must be certified by the state in which they operate, must maintain a website for the purpose of enrolling individuals in health plans, must be capable of displaying plan rating information, and must demonstrate the ability to receive tax credit information for individuals enrolling in health plans.
- Under the legislation, the Secretary will be required to design a process to provide private exchanges with the minimum information necessary to enroll individuals in health plans, and to communicate to consumers eligibility for advanced premium tax credits and cost-sharing reductions.
"While the King v. Burwell case is just beginning and no one can predict the outcome, it is important for
"Governors of these 37 states will need to answer to hundreds of thousands of citizens who will no longer have access to affordable health insurance, but the costs, risks, and time involved in building their own exchange can be prohibitive," Lauer continued. "There is a very simple, effective solution that these states could utilize almost immediately, at no additional cost to taxpayers. As the leading private exchange, eHealth has long advocated for an effective private-public sector solution and we believe with this proposal Democrats, Republicans and most importantly consumers, will win."
About eHealth
For more health insurance news and information, visit the eHealth consumer blog: Get Smart -- Get Covered or visit eHealth's Consumer Resource Center.
Forward-Looking Statements
This press release contains forward-looking statements, including statements regarding the possible outcome of litigation related to the ACA, potential governmental and regulatory actions in response to such outcome, and the impact of a proposal involving private exchanges to address a potential outcome of such litigation. These forward-looking statements involve certain risks and uncertainties that could cause actual results to differ materially from those indicated in such forward-looking statements, including but not limited to: the final outcome of the court case King v. Burwell and any other litigation related to the ACA; the political, legislative, regulatory or other governmental or official responses to such litigation; the effect of any such litigation on consumers, insurance brokers and agents, insurance carriers, and insurance markets; any new or revised laws or regulations or other actions taken by federal and state regulatory agencies, including the
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