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Gov. Rick Snyder said Monday he would ask the Republican-controlled Legislature to create a state-run health exchange if a key part of the Affordable Care Act does not survive a legal challenge.

But U.S. Health and Human Services Secretary Sylvia Burwell said Monday she believes the Obama administration and the health care law will survive the challenge before the U.S. Supreme Court and declared health reform a success.

Burwell’s comments follow testimony before the U.S. Supreme Court last week in the case of King v. Burwell, which challenges whether federal tax credits can be paid to Americans in the 34 states — including Michigan — with health insurance exchanges run by the federal government. Plaintiffs argue that the law only allows tax credits in the 16 states that run their own health insurance marketplaces.

“We are confident that we will prevail in the court case argued last week before the Supreme Court,” Burwell said Monday. “The law is clear. The text and structure of the Affordable Care Act demonstrate that individuals in every state are eligible for tax credits.”

Michigan is among seven states whose health exchanges are run by a state-federal partnership. Three states have federally supported marketplaces, and 27 have federally facilitated exchanges.

In an interview that aired Monday on Michigan Public Radio Network stations, Snyder said it will be a “huge issue” if Michigan residents are no longer able to qualify for the incentives. He said U.S. Rep. Fred Upton, R-St. Joseph, is leading discussion of a possible congressional solution if the tax credits are denied.

Short of that, Snyder said he would ask the Republican-controlled Legislature to make Michigan’s a state-run exchange.

“That raises the issue, should we be looking at a state exchange, and that’s a dialogue I’d have to have with the Legislature,” Snyder told MPR’s Rick Pluta.

The Legislature previously rejected that approach.

Burwell Monday said nearly 11.7 million Americans signed up or were re-enrolled through the Marketplace through Feb. 22.

“While we know that number will change as the year continues, we are pleased with the results to date,” Burwell said.

According to Burwell, more than half of those who enrolled through HealthCare.gov were new customers. Of the 4.2 million consumers who were re-enrolled, more than half, or about 2.2 million, came back to the marketplace, updated their information and actively selected a plan.

Nearly 7.7 million individuals — or 87 percent — who selected a plan through HealthCare.gov qualified for an average tax credit of $263 per month. With that financial assistance, more than half paid $100 or less per month after tax credits, and 8 in 10 had such an option to do that.

“These numbers show just how important the tax credits are to millions of Americans and to the insurance markets in those states and throughout the marketplace,” Burwell said.

But an H&R Block analysis of early 2014 federal tax returns has found that some taxpayers are needing to refund part of their tax credit because they under-estimated the amount of money they would make last year. In returns through mid-February, the average amount to be paid back relating to the Affordable Care Act’s Advance Premium Tax Credit was $530, according to H&R Block.

kbouffard@detroitnews.com

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