With time running out on this session’s Supreme Court term, Republican senators are discussing their options on how to react to a possible court ruling that would cut-off potentially 6.4 million people from their health insurance tax credits. At the same time the Congressional Budget Office said in an updated review that repeal of the ACA would increase the deficit by at least $137 billion over the next ten years.

The Court has a few big rulings to issue (also gay marriage) but the one that could cause the biggest political disturbance in Washington would be if the Court rules that the way the ACA is technically written prohibits tax credits to offset the cost of health insurance from being provided in states currently relying on the federal health care exchanges.

The discussion taking place in the Senate would extend the tax credits for a period of time such as two years (delaying any major decisions until the next Administration).  On the House side the talks are also about a temporary extension.  There is also talk of packaging such an extension with a repeal of some other feature of the ACA.  There seems to be greater support of the temporary fix in the Senate but there is no clear indication how the four senator-presidential candidates will react.  Some may demand full repeal of the ACA.

A push to repeal becomes more of a challenge because of the new CBO estimate.  The $137 billion cost is calculated under the new CBO leadership (appointed by Republican leaders).  It is also calculated using the new “dynamic” scoring method which includes outside factors that had not been used in previous CBO projections. Under the more restrictive estimates used previous to this year the deficit impact is $353 billion over ten years.  If they attempt to use the reconciliation process the narrow requirements of reconciliation does not allow changes in law that will worsen the deficit.  The CBO report also calculated that in addition to deficit problems, 19 million people would lose health insurance in 2016 rising to 24 million people losing coverage by the end of the decade.

Any plan would need to get the President’s signature and President Obama will not sign legislation that would undercut or destroy what he sees as one of his biggest legacies.

If the Court restricts tax credits to state run exchanges, patients and states could face some real financial burdens in continuing health insurance, 6.4 million by general estimates. Through the ACA exchanges people can compare and buy health insurance.  If that person is below 400 percent of poverty then a federal tax credit reduces the monthly premium on a sliding scale.  Generally there are 34 states relying on the federal exchange rather than using their own exchange.  But within the thirty-four states are variations including federal-state partnerships.

The Supreme Court usually issues their rulings on Mondays and Thursdays but they do make exceptions for major year-end calls.