‘ A sigh of relief ’ for the industry
High court’s decision ‘ is a sigh of relief for the healthcare industry,’ analyst says.
Health insurers and hospitals are the big winners after the Supreme Court decision.
Health insurers and hospitals were big winners from a Supreme Court decision that upheld billions of dollars in Obamacare subsidies for U. S. consumers.
Many employers also applauded the 6- 3 ruling on Thursday, fearing that chaos that might have ensued from a ruling striking down subsidies in up to 37 states using the federal Healthcare. gov exchange. California had less at stake since it has established its own marketplace.
The court’s decision “is a sigh of relief for the healthcare industry,” said Megan Neuburger, an analyst at Fitch Ratings. “It’s ultimately positive for hospitals and health insurers as it keeps the status quo, which has been beneficial to them.”
Hospital and health insurance company stocks rallied after the court decision.
Shares of hospital chain Tenet Healthcare Corp. shot up $ 6.13, or 12.2%, to $ 56.21 in trading Thursday.
UnitedHealth Group Inc., the nation’s largest health insurer, saw its shares jump $ 3.16, or 2.7%, to $ 122.33 after the decision was announced.
Aetna Inc., the nation’s third- largest health insurer, said it welcomed the ruling because the federal assistance has been a major draw since last year in attracting 6.4 million customers to federally run exchanges.
Analysts said the court ruling clears up some uncertainty for the insurance industry, and it could help pave the way for a number of mega- mergers that have been proposed in recent weeks.
Aetna has made an offer for rival Humana Inc., a big player in Medicare Advantage plans, and Anthem Inc. is trying to acquire Cigna Corp. for $ 54 billion.
After the court decision, employers and other health industry officials urged political leaders to tackle the unfinished business of taming the country’s runaway medical spending.
“If we do not do more to control healthcare costs, the entire thing will collapse under its own weight regardless of what the Supreme Court or any other political body says,” said Micah Weinberg, president of the Bay Area Council Economic Institute, an employer- backed group in San Francisco.
Employer groups said they hope that the court decision allows Congress and the Obama administration to turn their attention to addressing numerous issues related to the quality and cost of care.
“The administration and Congress need to focus on real health reform — rationalizing the way we pay for and deliver healthcare in this country,” said Steve Wojcik, vice president of public policy at the National Business Group on Health.
A court ruling against the Obama administration in the King vs. Burwell case wouldn’t have had any immediate effect on Covered California and its 1.2 million consumers receiving subsidies because it’s a state- run marketplace.
Conservative activists in their unsuccessful challenge argued that a strict reading of the Affordable Care Act made subsidies available only in states such as Cali- fornia that created their own exchange.
However, California officials were concerned that a ruling against Obamacare would have opened the door to changes in Congress that could have negatively affected Californians.
About 1.4 million Californians are enrolled in the state exchange and nearly 90% receive some level of federal subsidy. The average monthly subsidy was $ 436 per household, according to the state.
“While this is a major victory for exchange markets, critical challenges remain,” said Caroline Pearson, senior vice president at consulting firm Avalere Health. “Exchanges need to focus on increasing enrollment and attracting younger, healthier individuals in order to ensure a variety of affordable health plan options.”
PRESIDENT OBAMA, with Vice President Joe Biden at his side in the White House Rose Garden, talks about the Supreme Court’s decision upholding billions of dollars in Obamacare subsidies for U. S. consumers.