Recently, the Supreme Court of the United States, in a landmark and headline-grabbing decision in King v. Burwell, ruled in a 6-3 vote that the Patient Protection and Affordable Care Act’s (the “ACA” or colloquially “Obamacare”) provision providing subsidies for healthcare does in fact cover every state, whether or not a state has its own healthcare exchange marketplace or if the federal government set up exchanges in states that chose not to set up their own. So far 37 states, including Illinois, do not employ state healthcare exchanges and thus rely on the federal exchange through www.healthcare.gov.
The case hinged largely on a technical reading of the relevant statute, but the end result is that all U.S. residents who qualify for ACA coverage on healthcare marketplace exchanges can receive subsidies that are intended to make healthcare insurance more affordable. Analysts in the industry believe that without those nationwide subsidies, insurance costs would have substantially increased and leave millions uncovered. A Chicago Tribune story covering the decision opened with the example of a Chicago area woman whose insurance premiums would have nearly tripled without subsidies she receives on the Illinois marketplace exchange under the ACA. Another person would have seen monthly premiums jump from $353 per month to $739 per month.
How is this relevant to nursing homes and the elderly?
While the ACA subsidies are intended to assist anyone who is eligible for healthcare, there was the possibility that overruling and voiding the subsidies could have put the general health insurance marketplace into a tailspin, and by way of that affect even seniors who rely on Medicare. Medicare, as we know, is a federal insurance program for the elderly, and administered jointly by both the federal and state governments. In addition to subsidies and other provisions to strengthen healthcare for Americans, the ACA expanded Medicare and Medicaid programs for seniors and the poor. Medicare specifically expanded to include more prevention services (like free annual “wellness” visits to the doctor), better community-based care for patients after their release from hospitals to avoid them being readmitted to hospitals, and also sought to lower the costs of prescription medications.
If the subsidies had been invalidated by the Supreme Court in its recent decision, in essence the whole ACA law and the economic structure of the exchanges could (and according to experts, would) have come crashing down, taking the expanded Medicare and Medicaid with them. Nursing homes are major beneficiaries of Medicare and Medicaid funding, which altogether makes up the vast majority of revenue for these facilities since so many residents are insured by either program. Thus the expanded flow of Medicare funding and benefits should continue to nursing home residents.
What about Illinois specifically?
According to the Chicago Tribune, about 232,000 Illinois residents will get to keep their reduced cost premiums for which they qualify under the ACA, now that the Supreme Court has upheld the validity of the federal exchange subsidies. The article reported that the average Illinoisan on the federal exchange pays a $128 per month premium thanks to subsidies. Without those subsidies, the average cost would have increased to $336. The bottom line is that seniors and nursing home residents seem to be safe now at least as far as the ACA expansion of Medicare is concerned.
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