Though the public is split on whether the solution should come from Congress or from the state, most Utah voters clearly prefer some sort of action to preserve access to health insurance subsidies.
On Wednesday, the Supreme Court will hear arguments in King v. Burwell, an important new case related to the Affordable Care Act, also known as Obamacare. This case involves whether or not citizens are eligible for tax credits when they purchase insurance on the federal health insurance exchange. Since the federal exchange began last year, people shopping there have been able to receive tax credits (or in other words, subsidies) to help them purchase insurance if their incomes fall below a certain threshold. The plaintiffs argue that one section of the law prohibits the government from giving citizens tax credits to purchase insurance if they bought their insurance on the exchange established by the federal government, instead of one established directly by the state. They contend that this is what Congress intended as an incentive for states to set up their own insurance exchanges.
The federal government disputes this claim and argues that the lawsuit is simply the work of a small group of very conservative lawyers and activists who are deeply opposed to the law and are now trying to use the courts to stop it instead of making changes through the legislative process. Not surprisingly, the government interprets the law very differently from the plaintiffs, holding that all citizens are eligible receive tax credits, whether they purchased their insurance on the state or federal exchange. Government lawyers and their supporters argue that neither Congress nor the states ever anticipated that subsidies would be prohibited on the federal exchange and that the plaintiffs’ interpretation is nonsensical because it would mean that the federal exchanges would not serve a core element of the law’s intent – making insurance “affordable” for those who purchase it.
Unlike the previous Obamacare cases that appeared before the Supreme Court, this one does not involve a question of the law’s constitutionality. Rather, it is, in some ways, a narrow technical dispute about how the Department of Health and Human Services has interpreted and implemented it. But if the plaintiffs are successful, the lawsuit could have a dramatic and devastating effect on insurance markets in states across the nation. The government and several health care analysts argue that prohibiting subsidies in states that chose to use the federal exchange will destabilize insurance markets and substantially increase the costs of health care for millions of Americans who have been benefitting from federal subsidies. Citizens in states that chose to establish their own exchanges would, however, continue to receive access to subsidies.
Why does any of this matter to Utah? Because like 33 other states, Utah elected not to set up its own exchange, relying instead on the federal alternative. Analysts from the Robert Wood Johnson Foundation estimate that if the lawsuit is successful, about 127,000 Utahns would lose access to assistance to help pay for their insurance. This would represent a loss of about $630 million in federal aid and, by another estimate, would likely increase insurance costs by about 289% for Utahns currently receiving aid. What’s more, even Utahns who do not currently benefit from tax credits may see their insurance costs go up as those who were receiving subsidies drop out of the insurance pool.
If the King v. Burwell lawsuit is successful, Utahns and their representatives in the state legislature and in Congress will face a difficult choice. Will members of Congress take action to restore access to health insurance tax credits for those on the federal exchange? Will Utah establish a state exchange? Or will representatives do nothing in the hopes that Obamacare will wither and ultimately die?
Already, Orrin Hatch and several others have argued that Congress should use the opportunity to fundamentally change the system established by the Affordable Care Act. Hatch’s plan was outlined in broad terms in The Washington Post on Sunday and involves retaining insurance subsidies for a transitional period of time, then ushering in more dramatic changes to the system later. But it is unclear whether Congress and President Obama would agree on substantial changes or even whether Republican members of Congress could coalesce around a single proposal.
The choice to establish a state exchange is also fraught with difficulty. When the law was first passed, states could receive grants from the federal government to help establish their own exchange, but that assistance is no longer available, nor is it clear that the state could act quickly enough to prevent some Utahns from losing subsidies. And as the recent debates about Governor Herbert’s Healthy Utah plan have made clear, it is not at all obvious that the state legislature would want to do anything that could be interpreted as supporting Obamacare, even if that means some Utahns have less access to health care coverage. Of course, doing nothing is a good way to underscore opposition to Obamacare, but it would leave substantial numbers of Utahns without needed support. None of the alternatives, then, would come without challenges and costs.
What do voters in Utah think about these options? Shortly after the Supreme Court agreed to hear King v. Burwell, we asked participants in our November 2014 Utah Voter Poll what they thought should happen if the plaintiffs win the lawsuit. We gave respondents to the survey some basic background on the case (full question wording available here), then presented them with four alternatives:
- “Utah should establish its own exchange so that qualifying citizens can receive tax credits for purchasing insurance”;
- “Utah should encourage Congress to fix the law so that qualifying citizens in states that use the federal exchange can receive tax credits, too”;
- “Utah should not do anything, even if that means the cost of health insurance will increase for Utahns who currently receive tax credits, because Utah should not support programs like the Affordable Care Act”;
- Don’t Know.
Notably, these four alternatives are about the narrow issue of tax credits, not about whether Congress should fundamentally re-think the Affordable Care Act. At the time of the survey, other alternatives like a temporary extension of subsidies had not yet been proposed. Nor was our purpose to ask Utahns how the Supreme Court should rule (a topic about which partisans have very different opinions). Our aim, instead, was to explore Utahns’ preferences in response to a win for the plaintiffs: would voters prefer a congressional fix, a state exchange, or complete resistance to anything associated with Obamacare?
When faced with those choices, most Utahns preferred some sort of action, though no single alternative received majority support. As can be seen in Figure 1, the largest proportion of survey respondents – about 40% — preferred that Congress act to ensure that consumers on the federal exchange receive tax credits. The next largest group – a little more than 28% — wanted Utah to establish its own exchange. Just over 20% expressed a preference for doing nothing, and another 10% didn’t know. Thus, nearly 70% wanted either federal or state representatives to take action of some sort, though some wanted Congress to take responsibility and others preferred a state-level solution.
Not surprisingly, the distribution of opinion differed by political party, though these differences are perhaps not as profound or as polarized as the debate about health care has been. The basic results can be seen in Figure 2. The biggest differences across the parties concern the “do nothing” option. Less than 1% of Democrats wanted to do nothing, compared to 18% of independents and 28% of Republicans. More than 90% of Democrats preferred state or federal action (with most Democrats wanting Congress to fix the problem). Among independents, more preferred a state-level solution to a congressional fix, but still, almost 75% expressed support for something other than doing nothing. While a substantial minority of Republicans wanted to do nothing, most expressed support for either federal (38%) or state (22%) action. In other words, in the face of a victory for the plaintiffs in King v. Burwell, just short of 60% of Republicans in conservative Utah prefer that either the state or the national government intervene to safeguard Utahns’ access to health insurance subsidies … and most of that group preferred a congressional solution.
In fact, the only group that prefers inaction to action on this issue includes those who say they are active supporters of the Tea Party (63%). But this is a minority group among Utah voters – in our survey, which parallels the electorate in 2012 and 2014, Tea Partiers represent only about 14% of all respondents. In other words, should the state’s elected officials decide to do nothing, they will be supporting the strong wishes of a vocal but still relatively small group of voters.
It is important to remember, of course, that we asked this question back in November, before public attention had focused much on the case. And it is quite possible that as Republicans put forward more concrete plans for what to do about health care, more Utahns will gravitate toward alternatives beyond the four we provided to our survey respondents. This was merely an initial attempt to explore the views of Utah voters on this issue. But the results also show that even in a deeply red state, the politics of this issue are not easy for lawmakers, especially Republicans who have opposed Obamacare. Neither a majority of voters nor a majority of Republicans favors limiting Utahns’ ability to receive federal tax credits. Though the public is split on whether the solution should come from Congress or from the state, most Utah voters clearly prefer some sort of action to preserve access to health insurance subsidies.
The poll that included these questions, fielded by BYU’s Center for the Study of Elections and Democracy, was administered online to a representative sample of Utahns who voted in at least one even-year general election from 2004-2012. The poll was in the field from November 14-23, 2014. Exact question wordings, along with details about sampling, response rates, and weighting, are available at the Utah Voter Poll website.