Joel Gehrke’s article on how Republicans should respond in the event the Supreme Court strikes down Obamacare subsidies in most states is typically informative but includes two passages that could mislead readers.
The first concerns the idea that Republicans should advance legislation to let states opt out of Obamacare. Under such legislation, residents of opt-out states would be free of the individual and employer mandates, most restrictions on what type of insurance people could buy would be lifted, and so on. People now on Obamacare’s exchanges could continue to receive subsidies, but those subsidies would no longer be tied to the exchanges or Obamacare’s regulations.
Because of the way Obamacare is written, the employer mandate will be effectively nullified and the individual mandate weakened in any states where the Court strikes down the subsidies. The article suggests that legislation that restores the subsidies in any form would therefore bring those mandates back to full strength. But that’s only if the legislation were written that way, and it should not be. The opt-out proposal discussed earlier in the article would kill the mandates—going further than the Court decision would—in any state that wanted to escape them.
The other questionable claim is that there would not be much political turmoil surrounding a Court-ordered end of the subsidies because only 3.4 million exchange participants get them. A few million exchange participants who don’t receive subsidies could see their premiums spike if a lot of subsidy recipients leave the exchanges. I’d like to see the exchanges extinguished, but I don’t think that a politically viable way to do it is for the Court to act and Republicans to do nothing in response.






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