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Covering the ACA state subsidy issue Date: 06/03/15

Lauren Sausser

By Lauren Sausser

I was surprised recently by an email from a reader asking me to write more about Medicaid expansion in South Carolina – specifically, this state’s refusal to expand the low-income health insurance program under the Affordable Care Act. It seems that not so long ago that’s pretty much all I was writing about.

Her email made a good point, though. This year, health insurance subsidies have played a much more prominent role in The Post and Courier’s Obamacare coverage. We’re waiting, like other news outlets, to find out what the Supreme Court decides in June in King v. Burwell. If the court rules in favor of the plaintiffs, subsidies will end in states using the federal exchange.

In South Carolina, a King victory would mean that coverage will become unaffordable for an estimated 200,000 people who have purchased subsidized policies through the federal insurance marketplace. It’s been a big story. Meanwhile, Medicaid expansion, with a few exceptions, is relatively stagnant here.

In January, Greg Sargent at The Washington Post gave me a good idea for an article on the Supreme Court case. He wrote that several Republican state-level officials across the country said they had no clue a few years ago that subsidies were at stake when they made decisions to establish (or not establish) state-based exchanges. He didn’t mention anyone in South Carolina, but I recognized it was a story we should localize. (Sam Stein at the Huffington Post did similar reporting based on state correspondence. See this Covering Health blog post.)

This much I already knew: in 2011, South Carolina’s Health Exchange Planning Committee decided that this state would opt into the federal exchange. That was before I started working at The Post and Courier in Charleston in early 2013, so I personally hadn’t covered that stage of the ACA decision making in South Carolina. I dug up some of our archived coverage, retrieved meeting minutes from the Department of Insurance that were still online and tracked down several members who had served on the now-defunct committee.

“At no point in the committee's discussion was there ever raised a concern that by opting into the federal exchange we were losing anything — especially subsidies,” one former committee member told me.

Other committee members I interviewed said the same thing and some of them made another point. They felt the cards were always stacked against a state-based exchange in South Carolina.

In 2011, my predecessor at The Post and Courier had filed an open records request with the South Carolina Department of Health and Human Services for a batch of emails between Gov. Nikki Haley’s office and her advisers regarding the Health Exchange Planning Committee.

In one of them, Haley wrote, “The whole point of this commission should be to figure out how to opt out and how to avoid a federal takeover, NOT create a state exchange.”

That story made national news. Haley’s email made it appear as if she dictated the recommendations of the Health Exchange Planning Committee long before the group had written its final report.

I thought some of those old emails might be useful again, especially if they mentioned health insurance subsidies at all, but I couldn’t find them. The reporter who had originally requested the documents had since left The Post and Courier; her email account had been deleted, and there apparently weren’t any hard copies. While we’d posted the whole batch of emails online when the 2011 story first published, the link was dead. (A hat tip here to our digital editor, Laura Gaton, who helped me exhaust every possible avenue to retrieve them before we realized our copy of the emails was gone for good.)

I asked a spokeswoman for the state agency to resend the emails and she very helpfully agreed. In 90 pages, it does not appear as if Haley, her cabinet members or any other state official understood in 2011 that subsidies might only be available for customers in states that set up their own health insurance exchanges – the argument the plaintiffs make in King.

If they had known South Carolinians would be ineligible for subsidies, would that have changed the committee’s recommendation? It’s hard to say.

South Carolina’s former Medicaid director, Tony Keck, who led the Health Exchange Planning Committee, would not speculate how recognition that subsidies could have been at risk would have shaped the committee's debate or its final recommendations, but in a follow-up interview told me, “I would have advised [Haley] in a completely different way than I did if I had known that.”

All this reporting produced several articles, but one last point – my editors and I agree that our coverage about health insurance subsidies is almost always stronger with “real people.” The trouble is finding them on deadline.

I’ve developed a good network of sources, some of them health insurance navigators, who have connected me with customers in a pinch. Many of these shoppers say they could not afford coverage without the help of federal subsidies. I’ve been able to save some of their stories for upcoming articles, knowing that I’ll continue writing about this for several more months.

Lauren Sausser is a health care reporter at The Post and Courier in Charleston, South Carolina. She won a 2014 AHCJ Award for Excellence in Health Care Journalism for her coverage of rural hospitals.