Delaware impact of Obamacare rulings

A pivotal piece of the Affordable Care Act health reform – the subsidies that made Obamacare insurance premiums affordable for millions – was the focus of conflicting court rulings Tuesday.

A U.S. Court of Appeals ruling in Washington, D.C., struck down the subsidies offered in 34 states, including Delaware. The U.S. Court of Appeals for the 4th Circuit in Virginia upheld them.

State officials say 81 percent of the 14,397 Delaware residents now covered by Obamacare plans received subsidies, with many seeing premiums under $100.

Erica Rhyne, an agent with Downes Insurance in Milford, said that was the case for the three people she enrolled in Obamacare plans. The other seven who tried to enroll "all were told to get Medicaid," she said.

"The subsidies are indeed a critical part of the delivery, especially for the individuals that meet that income level to gain insurance," said Rita Landgraf, secretary of the state Department of Health and Social Services. "Without that level of subsidy, people will be deeply impacted, and this insurance will not be affordable for them."

State Sen. Greg Lavelle, R-Sharpley, saw the rulings as more evidence the 2010 law was poorly crafted and implemented.

"The global lesson here is that you should know what you pass before you pass it," he said. "The fact that this law continues to draw such differentiated responses from a whole variety of courts makes it clear that it wasn't done with care."

The 2010 Affordable Care Act required all to have insurance by 2014 or face tax penalties.

The legal arguments focus on language in the law that allows tax subsidies to be offered through the states' insurance exchanges. At issue is whether the subsidies are legal in the 34 states – including Delaware – whose insurance marketplaces were partnerships with the federal government. The remaining states either ran their own marketplace or left insurance completely in the feds' hands.

The D.C. court ruled that subsidies should be granted only to state exchanges, not the hybrid state/federal exchanges. The Virginia court ruled that lawmakers intended to include all states in those subsidy opportunities.

Some, including Landgraf, believe the U.S. Supreme Court may have to sort it all out.

She said she expects the decision that struck down the subsidies to be appealed and said it is likely the ruling will be "stayed," which means its impact would not be felt until a further decision is rendered.

In any case, she said, those covered by subsidized plans should continue with their health care treatments.

The Rev. Donald Morton, of Wilmington, who says he is "cancer free" after surgery in May to address problems discovered after he got his Obamacare plan, said he knows that many conservatives hope the reforms fail and the law is dismantled.

"Who would celebrate such a victory?" he said. "Millions of individuals taking advantage of federal subsidies now won't have that available to them and can't afford health insurance. ... There is nothing moral about kicking millions out of health insurance because they can't afford it."

Lavelle said he agreed with the state's decision to link Delaware's insurance marketplace to the federal exchange. He said he doesn't know what should happen if the subsidies are declared illegal.

"I have to respectfully say that I don't know the answer to that question," he said. "Now you actually have more uninsured people."

Contact Beth Miller at (302) 324-2784 or bmiller@delawareonline.com. Follow on Twitter @BMiller57.