Over one million Oregonians will be harmed by today’s Supreme Court ObamaCare decision

The U.S. Supreme Court decision today in the King v. Burwell case is a sad reminder that the President of the United States and his Administration can arbitrarily interpret laws passed by Congress to suit their own purposes.

In this case, the Affordable Care Act clearly states multiple times in its text that federal subsidies to offset insurance premiums can only be granted to individuals purchasing policies through an exchange “established by the state.” When most states failed to establish such exchanges, the IRS arbitrarily decided to grant subsidies to individuals who purchased insurance through the federal exchange, healthcare.gov, as well. By a six to three vote, the Court told us that the President and his Administration need not follow the language of the law because in the Court’s opinion that could cause harm to the intent of the law which was to make insurance more affordable.

How this decision will affect Oregon is fairly clear. Oregon originally set up its own state-established exchange, Cover Oregon. But when that $305 million project failed to sign up one person for insurance on its flawed website, the Cover Oregon board voted to scrap the exchange and migrate Oregonians over to the federal exchange, healthcare.gov. Board members didn’t seem to care how this decision might impact subsidies for Oregonians, and after the fact said they were relying on federal assurances that they considered this arrangement a “supported state based marketplace”—meaning that it would still qualify for subsidies even if the Court were to rule opposite of how it ruled today.

What is clear now is that today’s decision could actually harm more Americans, and more Oregonians, than it helps. According to a March 3rd press release by Michael Cannon of the Cato Institute and Cascade Policy Institute’s Steve Buckstein, “If subsides are denied under a King ruling, Oregon will join the majority of states in reaping benefits.” Now that the King ruling has found for the government, the Cato Institute believes that “approximately 157,000 [Oregon] individuals likely will continue to be subject to the law’s individual mandate requirement,” and 890,000 working Oregonians “also will continue to be subject to the employer mandates that are putting downward pressure on our economy.” These negative results stem from the ACA’s provisions that as long as subsidies make insurance somehow “affordable,” then the act’s mandates to purchase it remain in place.

Today’s Court decision does not end the discussion about who should control your health care and who should decide what, if any, insurance you must purchase at what price; but it does push that discussion farther into the future. It unfortunately postpones our ability to move toward a more individual, patient-centered health care and health insurance world. Oregonians who watched their state government bungle an expansive insurance exchange project using other people’s money should be a big part of this discussion.

Steve Buckstein is senior policy analyst and founder at Cascade Policy Institute, Oregon’s free market public policy research organization.

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Posted by at 10:28 | Posted in Congress, Cover Oregon, Federal Government, Health Care Reform, Obamacare, U.S. Supreme Court | 20 Comments |Email This Post Email This Post |Print This Post Print This Post
  • crayoloa

    SCOTUS is helping to protect the poor and the downtrodden. Take me for example. I am a struggling artist and I was forced to work 50 hours a week to support my art…and just to get health care. Now, with free health care, I can relax a bit and let my art out and about and share it with others without the worry and such about my health….this is good, as my art is really great. Although nobody will pay for it, I expect someday to sell one of my oil paintings of the homeless along the Willamette.

    • Nuts to ’em

      OMG, if such marrooney jerk-offs-unruly exist and are allowed to beg Si Patron along/abong Oregon pathos ways and extremes!

      • .

        Rebuk’em Dano!

  • IhateLiberals

    This is great news for Republicans. Now Democrats and Democrats only own this sorry piece of garbage called the ACA. The lies and phony cost figures now belong ONLY TO DEMOCRATS.

  • Ardbeg

    So exactly how am I “harmed” by the aca?

    • thevillageidiot

      if you are already getting it for”free”nothing changes you will continue with the same great medical care through Medicaid and Medicare you are currently enrolled in. if you re paying for it you have to read the ACA in order to understand whats in it. bottom line your insurance premiums will increase. and BTW Medicade for oregon and all the others will be losing funding from the Fed soon.

      • Eric Blair

        I don’t think that is quite what is happening. The Feds will fund Medicaid expansion at %100 … by 2020 that share will drop to %90, and not fall below that.

        How is that hurting 1 million Oregonians?

        • redbean

          The links in the next-to-last paragraph above explain the answer to your question (especially the first one where the numbers comes from). It boils down to Bastiat’s “what is seen” (a governmental intervention) vs. “what is not seen” (the resulting personal, social and economic losses resulting from the government intervention).

          • Eric Blair

            And what personal losses will that be? Evidently giving coverage to people who didn’t have it before… still makes them victims? They were victims to the unseen before: “the market”.

          • redbean

            The personal loss is that of the physician-patient relationship. Having insurance coverage is not synonymous with receiving care. The victims are those who had coverage before and lost it, or who now have such high deductibles that they can’t afford the care they need. It wasn’t necessary for government to create those victims in order to cover the small fraction of uninsured. Control, not service, is the ACA’s goal.

            There hasn’t been a free market in US healthcare in over a century, initially thanks to the AMA and the industry stranglehold of Carnegie (medical education) and Rockefeller (pharmaceuticals), made possible through their influence on “progressive” governments. The early champions of nonprofit medical schools and hospitals created barriers to practice entry (especially for women and African Americans), resulting in artificial physician shortages to boost wages. None of this would have been possible without politically motivated governmental discrimination against for-profit entities.

            Medical insurance likewise saw political (i.e. government) favoritism toward the “blue” plans (Blue Cross/Blue Shield) mid century. Then the federal government’s wage and price controls at the end of WWII forced employers to compete for labor, not with competitive wages, but with benefits. This led to tax benefits for large employers’ insurance plans at the expense of small business and individual plans. Still, the market sought to meet the needs of patients through the 1960s, when physicians made house calls, large medical bills could be paid over time without interest and catastrophic policies covered the really big stuff. Once Medicare and Medicaid entered the scene in the mid 1960’s, any semblance of a free market in medicine was gone. A functioning market needs communication between buyers and sellers by way of price signals – which is impossible with either third-party payers or a single payer system.

          • Eric Blair

            And how well did that system work for many before 1960? Medicare and Medicaid didn’t just happen – they were the result of the realization that many didn’t have consistent access to health care.

            Price signals sound good, and work extremely well for Xbox’s. However, medical care is an entirely different ball game. I can not buy an Xbox if the price is too high, or I don’t have the money for it. That is not how it works for health care (and I’m not talking about procedures like cosmetic surgery)

          • redbean

            Before 1960, that system worked well for most. Medical care was reasonably priced and people paid cash for doctor’s visits. Doctors had relationships with patients and would work out whatever the patient could afford including bartering. Hospitals had the freedom to write off bills and many were funded by religious or charitable organizations. Doctors and residents spent more time in charity clinics then; now
            the demands of government managed care make that difficult.

            Benevolence toward the poor and elderly was not the motivation for Medicare and Medicaid and both were bankrupt within a few years, leading to a true crisis in about 1970 that has only grown.

            Medicine is a service industry. Price signals worked in the past and could work again if health savings accounts were used to pay expenses. These could be government funded for those in need, but the customer would control the spending.

            When my elderly relatives received an in-home physical therapy bill showing the Medicare amounts, they tried to report what they thought was fraud. The bill was in the thousands for a few 20-minute sessions. If this couple paid the bill directly from an HSA, they could negotiate for the service. The therapist would be happy to get paid in a timely manner while avoiding Medicare’s complicated billing practices that require an office of non-clinical people to manage, and which severely penalizes providers for innocent mistakes. Keeping the customer out of the loop is one of the main causes of healthcare inflation. But due to Medicare regulations, providers and patients are forbidden to deal in cash.

    • redbean

      If you think it’s beneficial to have no place to turn for medical care except a cartel, then no worries. Thanks to the ACA, the worst aspects of HMO care are the law of the land. The doctor-patient relationship has been “transformed” – you are no longer a medical customer, you’re a liability to the system.

      Your doctor has contracts with insurance companies who
      call the shots on the type of treatment you’ll receive, regardless of your doctor’s professional opinion. If your needs fit within standard practice guidelines (defined by big pharma, big insurance and the federal bureaucracy), your doctor will treat you according to the template. If you have more complicated needs that fall outside the algorithm, and especially if you’re over 45, good luck. With the ACA, no one cares what you, the patient, thinks “healthcare quality” means, despite all the happy talk about “patient-centered care.”

      Even if you’re one of the “lucky” ones to receive a subsidy, which you need because the insurance is overpriced, you’re still paying for it in other ways. Medical overhead costs are booming, which means less money for actual medical care. If they “print” the money to fund subsidies, you pay through the resultant inflation that represents a hidden tax on everyone, especially the poor and those on fixed incomes.

      Whether they inflate or borrow, Wall Street and the big banks rejoice because they will reap the windfall (which is why the 1% favor big-spending politicians of both parties and despise tea partiers). Food prices are breaking the family budget, but hospital and insurance stocks are up, up up!

      Maybe it doesn’t bother you in the least that your medical records are heading soon to a mega storage depot, where every Tom, Dick, and Lois at the IRS and NSA can rummage around in them at will. You may not find any of this troubling or feel “harmed.” Value is subjective, after all, except to those bureaucrats and academics who think you’re too stupid to know what you want, and what you want to pay for it.

      • Eric Blair

        Yet.. big insurance and big pharma have always called the shots… and people with private health insurance have always had limitations on their care. There is nothing new in that.

        What will hopefully change is that insurance companies will no longer spend close to .20 on the dollar to deny coverage.

        Perhaps it doesn’t bother you that the only health insurance the poor have is to visit the emergency room? And we know how bad follow up care is when they do that.

        Or perhaps it doesn’t bother you that the one of the most common reason for those in the middle class to declare bankruptcy is due to medical expenses.

        Either way Wall Street, Big Pharma, and Big Insurance have made out like bandits. At least now there is a chance that those who didn’t have coverage will now.

        The problem with the Tea Party is that they focus on only one side of the equation: government. They are seemingly indifferent to the control that big business exerts on this country.

        • redbean

          Starting with your last point: Opposition to the Too-Big-to-Fail bank bailouts was the
          impetus for the tea party (no caps needed, it’s not an actual organization). The “Don’t Touch My Medicare” signs revealed a well-grounded fear about their own government dependence among the older “members.”

          Yes, there will always be limitations to care because there is no free lunch and we all want to live forever. But rationing will worsen under the coming single payer system because there is insufficient incentive to please the patient – the system will meet its own needs first and foremost.

          It bothers me that the poor lack health care – insurance is not care! The poor do have options besides the ER, or at least they did before the ACA gutted free clinics and forced independent providers to join mega-hospital networks or go out of business. The ER issue is indeed complex. Ever heard of EMTALA? Good intentions are the road to you-know-where.

          Yes, it bothers me that medical expenses lead to bankruptcy. Not sure why you would think it doesn’t. But we can thank 100 years of political “solutions” for all the cost-shifting games that produce the exorbitant fees.

          I’m perplexed that you assume these problems don’t bother me. I am pointing out that we are saddled with an unsustainable system and there really is no cause for optimism at this point. The disease is “progressive” and is only going to get worse, especially for the most vulnerable among us. You may disagree with my diagnosis, but my concern is sincere.

          • Eric Blair

            No.. but health insurance provides access to care. I think you know that and are splitting hairs.

            The fact is, before the ACA, a large proportion of the poor went without health care, except for when symptoms seemed severe. The system before ACA did not serve the poor well at all. They have better options now with ACA.

            Your concern may be sincere, but it is heavily modified by your more apparent concern for the Free Market.

            Now.. I’m not a big champion of the current system, but it probably won’t surprise you to find out that I’m a single-payer kind of guy.

          • redbean

            Insurance works well for unexpected catastrophic events; using it to cover routine care is not sustainable. Paying for scam health “insurance” takes away money to pay for actual care. Free clinics do exist that don’t require insurance, although the ACA makes it difficult for them and whether they can continue much longer is in doubt.

            My “apparent concern” for the free market is precisely because it would provide higher quality care for everyone, even those relying on charity.

            It wasn’t necessary to destroy options and privacy for all in order to provide a minimal level of care for a fraction of patients. Now more people are avoiding care because the faux marketplace offerings have unaffordable deductibles. Thankfully, cash-only practices are starting up that save patients money over the ACA options, even for surgeries.

            I’m a practical person and if single payer was a humane and effective system, I’d be for it, too. But it’s not.

  • neha patel
  • neha patel
  • neha patel

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