That best describes how hospital leaders reacted to today’s Supreme Court ruling upholding subsidies in states that utilize the federally run health insurance exchange under the Affordable Care Act.
“We are celebrating today’s decision,” says Sally Jeffcoat, executive vice president, West/Midwest Group, Trinity Health. “It is a victory for working people. It supports access to coverage and the steps we are taking to transform the delivery system.”
Trinity operates hospitals in 14 states that are directly impacted by the court’s ruling. Across its 21 states, Trinity has helped more than 300,000 individuals sign up for coverage under the ACA, Jeffcoat says.
The case before the court, King v Burwell, has been the most anticipated health care event of the year. The court had to decide the meaning of six words — “an exchange established by the state.” Opponents of the law argued that “the state” meant that federal subsidies could only be made available to people who signed up for coverage in a state-based exchange. That argument would have jeopardized coverage for millions of Americans who bought coverage in the 30-plus states that rely on the federal exchange.
Writing for the 6-3 majority, Chief Justice John Roberts said that the ambiguous language meant the court had to look at the “broader structure of the act.” In doing so, the majority determined that Congress intended for all qualified individuals on an exchange to be eligible for the subsidy.
The court, Roberts wrote, “must respect the role of the legislature, and take care not to undo what it has done. A fair reading of legislation demands a fair understanding of the legislative plan. Congress passed the Affordable Care Act to improve health insurance markets, not to destroy them. If at all possible, we must interpret the Act in a way that is consistent with the former, and avoids the latter.”
(Sean Marotta, an associate in the Washington office of Hogan Lovells, focusing on appellate and Supreme Court litigation, and outside counsel for the AHA, is providing real-time analysis of the ruling on AHA Stat, the association's blog.)
That interpretation was a relief to Jim Nathan, president and CEO, Lee Memorial Health System, Fort Myers, Fla.
“Many Florida leaders worked to dismantle and be negative about Obamacare,” he says. “Florida has the second highest rate of uninsured Americans, but at one point had the highest rate of people enrolled for coverage via the exchange, so this is a big issue for the state.”
A ruling against the subsidies, he says, could have destabilized economics for hospitals in the state. Leading up to the rollout of the ACA, Lee Memorial had seen the percentage of commercially insured patients drop from 35 to 20 percent.
“That shrinkage stopped over the last year or so, and that is attributable to getting coverage via the exchanges,” he says.
The hospital still faces the financial challenge, however, of having a large number of people signing up for high-deductible plans in the exchange and not being able to meet their out-of-pocket expenses.
For the nearly 137,000 individuals who signed up for coverage in Louisiana, the ruling means continued access to affordable coverage, says Teri Fontenot, president and CEO, Woman’s Hospital, Baton Rouge, La. Without a subsidy, she says, the Louisiana Hospital Association calculated that premiums would have soared by 347 percent.
Of course, this is not the end of challenges — legal, political and otherwise — for the ACA. The likely next target in the courts will be the employer mandate. It will certainly be a hot potato in the 2016 presidential election as well.
However, for hospital leaders, today’s ruling gives them more certainty moving forward.
“It provides stability for everything we are doing along the population health model,” Fontenot says. “If people can’t afford to get care, then that impacts their ability to stay healthy and stay out of the hospital.”