King v Burwell: What Does It Mean and Why Is It Important?

Last month, a vote took place in the Supreme Court that changed the discourse of one of the most controversial topics in our country today and will help ensure equality for all Americans…and by the way, I’m not talking about same-sex marriage (although that was pretty great too). 

I’m talking about the King versus Burwell case, a case that had the potential to crumble the Affordable Care Act (ACA)—or “Obamacare”; and because the Supreme Court ruled in Burwell’s favor, affordable healthcare coverage remains accessible to all!

Let’s break it down…

The 2 Things You Should Know First

  1. Within the ACA, the federal government offers subsidies to those who qualify to reduce their insurance premiums and out-of-pocket costs. This helps ensure affordable health insurance is available to everyone, including moderate and low-income people.
  2. New organizations called “Marketplaces” were set up that provide a better way for people to shop for insurance plans (if insurance is not already provided through their employer or elsewhere). These Marketplaces—also known as “exchanges”—show multiple health plan options so that people can make smart decisions regarding what plan is right for them and their families. Every state was given the option to create their own Marketplace; and if a state decided not to create their own, the federal government would run the Marketplace in that state. 

The Drama…

Language in the ACA states “the premium subsidy amount” is based on the cost of a “qualified health plan. . . enrolled in through [a Marketplace] established by the State under § 1311 of the [ACA].”  

According to King and his pals, this language clearly states that subsidies should be available ONLY to individuals who purchased health plans in a state with a state-established Marketplace. MEANING: their claim is that the federal government does not have the authority to provide subsidies to those who purchased plans in a state with a federally-run Marketplace. 

So What Would Have Happened if King Won?

If the Supreme Court ruled in King’s favor, individuals and families who purchased plans from federally-run exchanges would have lost federal subsidies and their insurance costs would have skyrocketed an average 287% of what they’re paying now.  Imagine a low-income family suddenly having to pay $430 instead of $150 a month for insurance—that’s a major increase! For the vast majority of people receiving subsidies, this would mean they wouldn’t be able to afford insurance at all. So that’s MILLIONS of people who would most likely drop their coverage, leading to catastrophic consequences to the insurance markets in these states. 

Luckily, the Supreme Court ruled in favor of the federal government thus closing the case and declaring federal subsidies “legal” in both state-run AND federally-run exchanges. PHEW!

Why Do We Care So Much?

Thanks to the Supreme Court’s decision, millions of individuals and families who rely on federal subsidies are no longer at risk of losing their health coverage. This is a major victory for anyone like us who believes in the right to affordable healthcare!

The Discovery USA Advocacy team executes strategies that focus on expanding access to care and improving patient outcomes for all communities—it’s our passion! So needless to say, we were pretty happy with the Supreme Court’s decision. 

The Affordable Care Act was an extraordinary step toward ensuring every American can afford healthcare, and it’s a relief we won’t be taking any steps back. 

Gina Albert

Advocacy Account Supervisor
Eternal optimist with a passion for golden retrievers, breakfast buffets, and trying to make the world a better place.