If the U.S. Supreme Court strikes a blow at the federal health-care act this month, the immediate result is predicted to be chaos.
But not in New Mexico, according to state health-care officials and national experts.
Although New Mexico uses the federal website to enroll individuals in insurance plans, it is classified as having a state exchange because state officials perform all other duties, such as marketing, information outreach, compliance and research.
The much-anticipated high court ruling in King v. Burwell, expected by the end of this month, centers on whether specific wording in the Affordable Care Act allows the federal government to help people buy insurance everywhere in the country or only in states that have set up their own insurance marketplaces, or exchanges.
Those who brought the case against the 2010 health-care law argue that its wording allows the federal government to subsidize coverage only in states that set up their own health-insurance markets — like New Mexico — and not in the 34 states that rely on the federal exchange.
“We are not sure what’s going to happen in the future with regard to the Affordable Care Act and how it’s going to play out,” said J.R. Damron, chairman of the New Mexico Health Insurance Exchange. But “we feel confident that the citizens of New Mexico … will be getting the tax subsidies. We feel we are in a good position.”
The subsidies are key to the health-care act because they have allowed about 7 million people in those 34 states to buy health insurance. For the majority, coverage would become unaffordable if the subsidies were struck down, insurers would have to raise rates and more people would drop out, leading to a “death spiral” for the marketplaces, according to the Kaiser Family Foundation.
Jennifer Tolbert, state health policy director for Kaiser, echoed Damron’s remarks. “You won’t be affected unless there is an unusual ruling.”
In New Mexico, 52,358 people have signed up or were automatically renewed for health-care coverage, while 44,085 of those have paid a premium and actually gained coverage.
Recently, the exchange board dropped plans to build a state website for individual consumers and decided instead to continue using the federal site. A majority of members and state Insurance Commissioner John Franchini said it would be too costly to build the website.
The health exchange won’t have to start paying to use the federal website until 2017. Linda Wedeen, the exchange’s communication and outreach director, said state and federal officials are in negotiations now to set a price. She said the exchange is seeking an annual cost in the range of $3 million to $5 million.
Damron says the high court ruling is one of only two hurdles for the health-care act.
“The real big one is who is going to be president in 2016,” he said. “Our board felt like we needed to have as many options as possible going forward.”