If you live in Virginia, an upcoming Supreme Court decision may have you wondering if your health insurance subsidy is in jeopardy.
Last year several lawsuits were brought against the government challenging the authority of the IRS to distribute health insurance subsidies to people who buy their coverage on the federal exchange (aka healthcare.gov). The issue was whether or not the language in the Affordable Care Act — which refers specifically to state-run exchanges — allows subsidies for plans purchased through the federal exchange.
(Note: Virginia is one of 36 states which did not set up its own exchange and instead relies upon the federal exchange.)
In one case, Halbig v. Burwell, the court ruled the IRS does NOT have the authority. However, in King v. Burwell (coincidentally decided the very same day), a Virginia court ruled the IRS DOES have the authority. No action was taken at the time, but all eyes were on the U.S. Supreme Court to see if it would eventually weigh in.
Not surprisingly, the Supreme Court did agree to hear King v. Burwell, and will do so this March. A ruling is expected in July, 2015.
Significance of King v. Burwell
This case is significant mainly because of the attention it is drawing, both from lawmakers and residents of states that, like Virginia, use the federal exchange.
Understandably, consumers are worried about what will happen if the Supreme Court nixes subsidies in these 36 states. Will millions of Americans owe back the subsidies they already collected? Will their “affordable” health insurance suddenly become unaffordable?
Most legal experts agree Congress did not intend to disallow subsidies for plans bought on the federal exchange, and that this amounts to nothing more than an ambiguity in the law’s language. In fact, the IRS determined it could resolve the ambiguity by declaring that anyone whose income qualifies them for a subsidy — regardless of how they signed up for their coverage — would get a subsidy.
So has this become a political battle over the law itself? Most assuredly.
Do we believe there is cause for concern among consumers? Most assuredly not.
Here’s why:
As of today, nothing has changed. If your income qualifies you for a subsidy, you will get a subsidy. Period.
As far as owing back any subsidy you have already received, everything we’ve read indicates that if the Supreme Court does rule against subsidies through the federal marketplace, the ruling will not be applied retroactively. That’s because the Internal Revenue Code itself gives discretion to the Treasury Secretary as to whether or not to apply court decisions retroactively. Would any sitting Treasury Secretary do that? Highly unlikely.
Business as Usual for Virginia Residents
So as we first wrote when Halbig v. Burwell was decided last year, it is business as usual at Virginia Medical Plans. If you live in Virginia, we encourage you to pursue a subsidy for your health insurance if your income allows it.
If you are curious as to how much your subsidy may be and what type of coverage is available, please visit www.enrollvirginianow.com.
By simply entering your zip code and a few other pieces of information, you will get a quick quote on several available plans. You can also actually enroll in coverage through the site in less than 15 minutes for an average family. Here’s how:
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Virginia Medical Plans Can Help
Choosing health insurance can be complicated. But we can help — at no extra cost to you.
Call our office at 703-707-8270 to go over your options.
Don’t delay! Open enrollment for 2015 plans ends on February 15.
| If you enroll between … | Your coverage will begin … |
| December 16, 2014 – January 15, 2015 | February 1, 2015 |
| January 16, 2015 – February 15, 2015 | March 1, 2015 |
