The Supreme Court & Healthcare: What Will the Decision Mean in RI?
Monday, April 02, 2012
At the heart of the matter was whether the individual mandate – the requirement that individuals must purchase health insurance – is constitutional. If it’s found not to be, many other healthcare reform provisions will likely be impacted.
Will the Supreme Court kill the individual mandate and, with it, the rest of healthcare reform? Will it strike down only the mandate and preserve other provisions of the legislation? Or will it rule to uphold the individual mandate?
It will be a couple of months before the Justices announce their decision, leaving the rest of us plenty of time to consider the potential impact. One thing many Rhode Islanders are wondering now is what will happen to the state healthcare Exchange—and the federal subsidies for income-qualifying individuals to purchase through it – if the individual mandate is struck down?
The Future of the Exchange
In concert with the individual mandate, the Exchanges are required under federal healthcare reform to provide a marketplace for individuals to check eligibility, learn about and purchase health plans.
The state Exchanges must be set up by 2014. But, without the federal mandate to purchase insurance, there’d likely be no need for them. And if there was no Exchange requirement, there’d be no federal subsidies.
States, however, would still have the option to set up an Exchange on their own, and many states, including Rhode Island, have already been in the planning stages, readying for implementation. But how would they fund the subsidies for qualifying individuals?
Who Will Fund the Subsidies?
Could the states require a tax on health insurance premiums, or create other tax-raising opportunities to fund the plans locally? Will Rhode Islanders be willing to pay 2- 3% more on health insurance premiums that are already rising 9-10% a year to pay for others who qualify for premium assistance? The state secured a $58 million grant to operationalize the Exchange, but even if the individual mandate is upheld, this money can’t be used for subsidies.
If the Exchange is to become a reality, it needs to be the affordable option it was intended to be.
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