The Supreme Court will prompt a “death spiral” if it strikes Obamacare subsidies in most states later this month, a top administration official said Thursday.
Health and Human Services Secretary Sylvia Mathews Burwell was referring to the possibility that healthier people who don’t have a pressing need for health coverage might drop out of insurance pools, leaving behind sicker customers and causing premiums to skyrocket.
That’s what could happen if the justices uphold the King v. Burwell challenge. In that case, poor and middle-income Americans in the 37 states not running their own insurance marketplaces could lose Obamacare subsidies that make their health coverage affordable, causing them to drop out of insurance entirely.
There’s nothing the administration can do to fix the problem besides helping states to run their own exchanges, Burwell has said in the past. She reiterated that position Thursday morning at an event hosted by the Wall Street Journal, saying that the administration’s ability to do more beyond that “is limited.”
The challengers argue the administration is violating the Affordable Care Act’s text by awarding the subsidies in states relying on healthcare.gov instead of running their own exchanges. But the administration says it’s carrying out the law an intended by Congress.
“We believe we hold the right position,” Burwell said. “We believe we’re implementing the law as it was written.”
