Burwell: No ‘Quick Fix' If Supreme Court Strikes Down Subsidies

By Christine Kern, contributing writer

HHS Secretary Sylvia Burwell warns of “massive damage to our healthcare system” if the Supreme Court denies subsidies.

HHS Secretary Sylvia Mathews Burwell sent a letter warning she has no administrative actions available to fix the “massive damage to our healthcare system” that would result should the Supreme Court invalidate federal subsidies set aside to help millions of Americans buy healthcare coverage.

As Modern Healthcare writes, the letter reflects the administration's stance in the growing tensions with Republican lawmakers in anticipation of the June Supreme Court decision on the King vs. Burwell case. Tensions were already high as Burwell was accused of stonewalling and contempt during a hearing before the Senate Finance Committee.

The King v. Burwell case has the potential to radically affect the standing of the ACA, since it will ultimately decide whether or not federal subsidies may be used for individuals purchasing insurance through federally-run healthcare exchanges.

If the Supreme Court decides in favor of King, it could result in 8.2 million low- and middle-income individuals in 34 states losing access to subsidies worth $28.2 billion, according to an analysis by the Urban Institute. Those beneficiaries are disproportionately located in conservative states that haven't embraced the federal healthcare law.

In her letter, Burwell reiterated her warnings that a win for the plaintiffs would cause millions to lose health coverage because they could no longer afford it. That, in turn, would mean disproportionately high numbers of sick, lower-earning people would continue buying health coverage, driving up health insurance costs for everyone else, she said.

“We know of no administrative actions that could, and therefore we have no plans that would, undo the massive damage to our health care system that would be caused by an adverse decision,” Burwell wrote.

For months, Burwell and other administration officials have angered GOP lawmakers by stating they have taken no steps in preparation for a Supreme Court victory by the plaintiffs. “Right now, my focus is on completing and implementing the law, which we believe is the law,” Burwell said during the Senate Finance Committee hearing earlier this month, according to The Hill. “Right now, what we’re focused on is the open enrollment.”

“By admitting they have no contingency plan to assist the millions that may lose subsidies, the administration confirms how the misguided law is unworkable for the American people,” Senate Finance Committee Chairman Orrin Hatch (R-UT) said in a written statement. “I’m committed to working with my Republican colleagues on how Congress can respond to help those hurt by Obamacare’s broken promises, including those in a post-King v. Burwell world.”

Experts like Tom Scully, an HHS official under former President George W. Bush, believe the administration does, in fact, have a contingency plan, but that they are keeping it close to the vest to put more pressure on the Supreme Court to uphold the subsidies. Scully told The Hill this month that “they certainly should not discuss it. Of course, they have one. They should all resign if they don’t.”

“This letter is clear and it is consequential,” Sen. John Barrasso (R-WY) said in a statement. “If the Supreme Court rules against the Administration, President Obama does not have the authority to use Administrative actions to undo the decision. Republicans are preparing for the ruling and are committed to helping the millions of Americans who have been hurt by the White House’s decision to illegally implement Obamacare.”