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Utahns Could Pay 500% More for Health Premiums, Depending on King v. Burwell Ruling

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Kaiser Family Foundation

This month, the U.S. Supreme Court is expected to announce its decision on King v. Burwell. The plaintiffs in the case claim tax credits in states that use the federal health insurance exchange are illegal. If the High Court stops these subsidies, many people across the country will be required to pay the full premiums on their insurance. Utah stands to lose more than most.

The Kaiser Family Foundation has put out a state-by-state analysis of what will happen if the Supreme Court rules in favor of the challengers in King versus Burwell. Kaiser researcher Cynthia Cox says it doesn’t look good for Utah.

“Utah is one of a handful of states that would be particularly hard hit by a Supreme Court decision on the side of the challengers,” Cox says.

Kaiser’s data shows premiums for more than 86,000 Utahns would go up an average of 520 percent. Cox says Utah has more to lose than most states because it receives generous subsidies under the Affordable Care Act. Those tax credits are based on income level and age of policy holders. Depending on how the court rules, Cox says this could happen before the end of the summer. She says, that’s only the most immediate impact. 

“The concern is that people who are healthy are going to drop out of the market, and this could result in what economists call a death spiral, meaning that the market becomes sicker and sicker, premiums become higher and higher, and insurance companies become even less likely to want to even offer coverage in that market,” Cox says.  

If the Supreme Court decides to revoke subsidies on the federal exchange, Utah has another option. It can move to a state-based exchange. Utah already has Avenue H, an insurance marketplace for small businesses. If it could provide an exchange for individuals, Cox says that would be one way to preserve Utah’s subsidies.

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