People Who Are Alive Today Because Of Obamacare Beg Court Not To Take Their Health Insurance Away

http://thinkprogress.org/justice/2014/11/03/3587771/people-who-are-alive-today-because-of-obamacare-beg-court-not-to-take-their-health-insurance-away/

by Ian Millhiser Posted on November 3, 2014

David Tedrow believes that Obamacare saved his life. Near the end of 2013, he was suffering from end-stage liver failure and needed a transplant or he would die. Unable to afford the transplant or the expensive follow-up care without insurance, David was able to obtain the health plan he needed to pay for his treatment through the Affordable Care Act’s insurance exchange in North Carolina, and this allowed him to remain on a transplant list he would have been taken off of if he was uninsured.

Last April, David received the transplant that saved his life. He believes that he is still here today because of Obamacare.

David is one of several individuals with life-threatening health conditions that joined an amicus brief filed Monday in the United States Court of Appeals for the District of Columbia Circuit. The brief asks the court to reject a claim brought by opponents of the Affordable Care Act seeking to cut off health subsidies to people entitled to receive them in nearly three dozen states. Other signatories to this brief include Jared Blitz, a man born with a heart condition who is able to afford life-saving heart surgery because of the Affordable Care Act, Jennifer Causor, a woman with cystic fibrosis whose story ThinkProgress told here, and Steve Orofino, a chemist and cancer patient who says that “I would have had to declare bankruptcy or I could be dead by now if it weren’t for the Act.”

•••••

Much of the threat Halbig presents to people like David, Jared, Jennifer and Steve is obvious. If the courts agree to cut off subsidies in most of the states, the out-of-pocket cost of health insurance premiums will skyrocket for many individuals because their premium will no longer be paid in part through Obamacare. As the amicus brief points out, however, Halbig is actually considerably more dangerous than an initial look at it might suggest.

The reason why is because health insurers must maintain a delicate balance of sick and healthy customers in order to remain in business. The nature of health insurance is that some customers — those that are currently healthy — pay more into their health plan’s insurance pool than they are currently drawing out. Meanwhile, other customers — those that are sick or have expensive chronic conditions — receive more money out of the insurance pool than they pay into it through their premiums. Thus, an insurance company must have enough healthy customers to pay for their sick customers, or they will be unable to cover the costs of these sick customers’ care.

If the subsidies dry up, people like David or Jennifer will continue to pay for insurance at nearly any price — they have no other choice. [At some point, they will have to do w/o and die, unless they rob a bank] But if the cost of insurance rises, many healthy people will decide that they would rather take their chances without insurance than pay expensive premiums. As more and more healthy people drop out of the insurance pool, however, the insurer will have no choice but to raise premiums in order to cover the costs of the sick customers that remain in the pool. Yet, as premiums rise even further, even more healthy people drop out of the pool. The result is a “death spiral” where higher premiums beget fewer customers, which beget higher premiums, which beget fewer customers.

Another amicus brief filed on behalf of several dozen economists predicted that, if the subsidies are cut off, the resulting premium spikes will render insurance “unaffordable for more than 99 percent of the families and individuals eligible for subsidies” in the states with federally-run exchanges. That could be enough to collapse the individual health insurance markets in those states, cutting off insurance entirely to people like David.

•••••