Gov. Tom Wolf’s administration will be looking to create a strategy for state residents who could lose federal subsidies.
The office of Governor Tom Wolf (D) of Pennsylvania has now announced that his administration will be writing a contingency plan for the health insurance exchange users in the state who risk losing their federal subsidies for their premiums.
This plan is being designed just in case a June ruling from the U.S. Supreme court withdraws the tax credits.
It is expected that the U.S. Supreme court will have made its decision by the end of June as to whether approximately 382,000 in Pennsylvania – in addition to another 2.8 million Americans – will be able to keep the tax credits to which they had previously qualified when they purchased their coverage through the health insurance exchange. The issue that is currently being considered has to do with a quirk in the design of the Affordable Care Act that states that subsidies should be available through the online marketplaces that have been “established by the state”.
That said, the health insurance exchanges in 34 states (including Pennsylvania) have been established by the federal government.
Those states depend on the healthcare.gov site in order to be able to offer their residents an online insurance exchange. Therefore, because of the wording of the health care reform, doubt has been thrown over the decision that residents within those 34 states will be able to qualify for the subsidies. Should the Supreme Court decide that the residents of the states using the federal site do not qualify for the tax credits, coverage could become considerably less affordable.
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Governor Wolf intends to be prepared for that situation, should it happen, and has said that the Insurance Department will be creating its own state-based insurance exchanged in order to ensure that the federal assistance will continue to flow into Pennsylvania. He has already spoken to the federal Department of Health and Human Services in order to express his intentions, said the announcement that his office released on Friday.
Wolf explained that it “would be irresponsible not to have a plan in place to protect 382,000 people,” against a potential Supreme Court decision saying that states using the federal health insurance exchange do not qualify for the subsidies.