Governors Weigh What Obamacare Ruling Could Mean For States' Subsidies

Assessing what might happen in the health-care marketplace.

U.S. Secretary of Health and Human Services Sylvia Burwell testifies during a hearing before the Senate Appropriations Committee November 12, 2014 on Capitol Hill in Washington, DC.

Photograph by Alex Wong, Getty Images

With a Supreme Court decision on health-insurance subsidies on the horizon, U.S. governors are bracing themselves, weighing what states that opted for a federal health-insurance marketplace under President Barack Obama's health-care overhaul might do if a ruling were to affect subsidies in those states. The country's governors, assembled this weekend at the annual National Governors Association meeting in Washington, are set to meet Sunday with Health and Human Services Secretary Sylvia Burwell. The subject promises to be a major topic of discussion.

Colorado Governor John Hickenlooper, chairman of the NGA, said that one question that governors are asking is whether states that run their own marketplaces can cover residents of other states.

"This is new ground,'' said Hickenlooper, a Democrat who opted for a state marketplace. "I don’t think anyone understands exactly what the alternatives are, depending on how the ruling comes.''

The high court is hearing a case involving subsidies for insurance through the marketplaces under the Patient Protection and Affordable Care Act. It could eliminate subsidies for millions of people in at least 37 states that don't operate their own marketplaces.

Utah Governor Gary Herbert, the NGA vice chairman, said he hoped there would be time for states to adjust if the court rules against the administration.

Indiana Governor Mike Pence, a Republican who opted not to establish a state marketplace, said that an alternative may need to be crafted.

"There's an old saying that you can't beat a program without a program, and we're going to be working closely with members of Congress and governors around the country to have an alternative ready if the Supreme Court makes the right decision,'' he said.

The case before the Supreme Court is King v. Burwell, 14-114.

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