MARCH 2015

THE COUNCIL OF STATE GOVERNMENTS

CAPITOL RESEARCH
HEALTH POLICY

Insurance Subsidies at Risk in Supreme Courts King v. Burwell Case

Approximately 7.7 million people living in states with
a federally run health insurance exchange purchased
health insurance and qualified for monthly premium
tax subsidies during the 2014-15 open enrollment
period, according to newly released data.1 The
estimated annual value of those tax subsidies tops
$24 billion, according to calculations by The Council
of State Governments.
These premium subsidies are at risk in the King
v. Burwell case currently before the U.S. Supreme
Court. On March 4, the Supreme Court heard oral
arguments challenging the legality of providing tax
subsidies to individuals with incomes between 100
percent and 400 percent of the federal poverty level
in states without a state-based health insurance
exchange. The issue before the court is whether the
tax subsidy can be extended in states without an
Exchange established by the State, as stated in
one section of the Affordable Care Act. A decision
is expected in late June 2015. Thirty-four states currently have no state-based exchange.
Sixteen other states and the District of Columbia
opted to implement state-based exchanges, where,
2.45 million individuals will receive approximately
$7.6 billion in premium tax subsidies in 2015.2 The
legality of these subsidies is not in question in the
case before the Supreme Courtexcept perhaps
in Oregon, Nevada and New Mexico, where state
officials have opted for a state-based exchange but
use the federal HealthCare.gov platform.

Hawaii has the lowest enrollment at 12,625 people.

Numbers Enrolled in Health Insurance for 2015

The average enrollment for all states and the

District of Columbia is 229,000 people.

Nearly 11.7 million Americans either selected an

insurance plan or were automatically re-enrolled in
the plan they had selected during the 2014-15 open
enrollment period, according to a federal government
data report released March 10.3
Three out of four enrollees live in one of the 34
states using the federal exchange.
The five states with the largest numbers of enrollees are Florida, California, Texas, North Carolina
and Georgia. There are just over 5.3 million enrollees in these five states, or about 45 percent of the

national total. California is the only one of those

five states with a state-based exchange.
In the five states with the lowest enrollment
Alaska, Hawaii, North Dakota, South Dakota and
Wyomingan average of just less than 19,000
individuals purchased health insurance.

Premium Prices and Value of Tax Subsidies

The monthly premium for health insurance policies
selected by consumers in the 34 states served by the
federal exchange averaged $364. More than 8 of
10 individualsnearly 7.7 million or 87 percent
qualified for a tax subsidy. The monthly average
tax subsidy is $263, bringing the average monthly
premium price down to $101. In 2015:
Alaska has the highest average premium before
the tax subsidy at $639. Wyoming ($550), New

Jersey ($470), West Virginia ($448) and Wisconsin

($440) round out the top five.
Plan premiums before the subsidy are the least
expensive in Utah ($248), Arizona ($278), Oklahoma ($295), Kansas ($301) and Tennessee ($316).
After the tax subsidy, the lowest average monthly
premium for a selected plan is $52 in Mississippi.
The highest average monthly premium after the
tax subsidy is $164 in New Jersey.
In the states served by the federal exchange, tax
subsidies reduced the price of premiums by an
average of 72 percent.4 The average monthly tax
subsidy is $263.
For the 16 states with state-based exchanges,
detailed information on premium prices for
selected plans and tax subsidies is not available
in the latest federal report on health insurance
exchanges.

$101 Average Monthly Premium after Tax

Subsidy in 34 States*

The annual value of the premium tax subsidies

varies from a high of $5.2 billion in Florida to a low
of $35.6 million in Hawaii.
In addition to Florida, the states where the value of
the tax subsidies exceeds $1 billion are California,
Texas, North Carolina, Georgia and Pennsylvania.
Among the 10 states receiving the most in tax subsidies, only California and New York implemented
state-based exchanges. The other eight states opted
to use a federal exchange.
The average annual value of tax subsidies is $630
million among all states. The average is a little
higher$702 millionamong the 34 states using
the federal exchange.
In states that implemented state-based exchanges,
where detailed information on premium prices for
plans and tax subsidies was not available in the
latest federal report on health insurance exchanges,
CSG calculated annual subsidy values using the
$263 average tax subsidy in the 34 states under the
federal exchange.

TOP TEN STATES: Annual Value of Premium Tax

Subsidies, 2015, in Billions of Dollars
6

$101

5
4

$263

3
2
1

AVERAGE MONTHLY TAX SUBSIDY

THE COUNCIL OF STATE GOVERNMENTS

NEW JERSEY

*Calif. and N.Y. have state-based exchanges. The other states use the federal
exchange.
Source: Health Insurance Marketplace 2015 Open Enrollment Period: March
Enrollment Report, U.S. Dept. of Health and Human Services Office of the
assisstant secretary for planning and evaluation, March 10, 2015.
http://aspe.hhs.gov/health/reports/2015/MarketPlaceEnrollment/Mar2015/
ib_2015mar_enrollment.pdf
REFERENCES
Health Insurance Marketplaces 2015 Open Enrollment Period: March Enrollment Report, U.S.
Dept. of Health and Human Services Office of the Assistant Secretary for Planning and Evaluation, March 10, 2015. http://aspe.hhs.gov/health/reports/2015/MarketPlaceEnrollment/
Mar2015/ib_2015mar_enrollment.pdf
1

Ibid.

Ibid.

Ibid.

Debra Miller, CSG Director of Health Policy, dmiller@csg.org

2

MICHIGAN

NEW YORK*

VIRGINIA

CSG estimates the annual value of the premium tax

subsidies for all states to be approximately $34 billion. About 70 percent of the value accrues to the 7.7
million citizens in the 34 states that may lose monthly
tax subsidies if the Supreme Court determines tax
subsidies are only allowable under the Affordable
Care Act in states that implemented their own
exchanges. In 2015:

PENNSYLVANIA

The High Value of Tax Subsidies at Question

before the Supreme Court

GEORGIA

Source: Health Insurance Marketplaces 2015 Open Enrollment Period: March

Enrollment Report, U.S. Dept. of Health and Human Services Office of the
Assistant Secretary for Planning and Evaluation, March 10, 2015. http://aspe.
hhs.gov/health/reports/2015/MarketPlaceEnrollment/Mar2015/ib_2015mar_
enrollment.pdf

NORTH CAROLINA

*Detailed premium data are available for 34 states using HealthCare.gov only.

TEXAS

CALIFORNIA*

AVERAGE MONTHLY PREMIUM AFTER SUBSIDY

2015 HEALTH INSURANCE SELECTIONS AND TAX SUBSIDIES

THROUGH HEALTH INSURANCE EXCHANGES
State

Health insurance
exchange

Individuals who
made a plan
selection

Average
monthly
premium
before
subsidy

% plan
selections
with tax
subsidies

Average
monthly
premium
after
subsidy

Average
monthly tax
subsidy*

Total annual value

of tax subsidies

Alabama

Federal

171,641

89%

$354

$266

$88

$487,611,484

Alaska

Federal

21,260

89%

$639

$534

$105

$121,248,331

Arizona

Federal

205,666

75%

$278

$155

$123

$286,904,070

Arkansas

Federal

65,684

88%

$389

$280

$109

$194,214,451

California

State-based

1,407,795

90%

$263 est.

$4,012,029,921

Colorado

State-based

140,327

54%

$263 est.

$240,036,631

Connecticut

State-based

109,839

77%

$263 est.

$268,308,558

District of
Columbia

State-based

18,465

11%

$263 est.

$6,293,758

Delaware

Federal

25,036

83%

$404

$264

$140

$65,830,660

Florida

Federal

1,596,296

93%

$376

$294

$82

$5,237,511,028

Georgia

Federal

541,080

89%

$346

$273

$73

$1,577,594,491

Hawaii

State-based

12,625

77%

$263 est.

$30,560,732

Idaho

State-based

97,079

84%

$263 est.

$257,973,075

Illinois

Federal

349,487

78%

$336

$208

$128

$680,409,251

Indiana

Federal

219,185

87%

$438

$319

$120

$729,964,957

Iowa

Federal

45,162

85%

$371

$260

$111

$119,769,624

Kansas

Federal

96,197

80%

$301

$211

$90

$194,856,643

Kentucky

State-based

106,330

69%

$263 est.

$232,555,194

Louisiana

Federal

186,277

89%

$416

$319

$97

$634,630,837

Maine

Federal

74,805

89%

$425

$332

$93

$265,240,577

Maryland

State-based

120,145

71%

$263 est.

$268,457,755

Massachusetts

State-based

140,540

66%

$263 est.

$290,965,021

Michigan

Federal

341,183

88%

$366

$236

$130

$850,282,625

Minnesota

State-based

59,704

N/A

N/A

Mississippi

Federal

104,538

93%

$405

$353

$52

$411,825,360

Missouri

Federal

253,430

88%

$363

$281

$82

$752,018,045

Montana

Federal

54,266

84%

$346

$230

$116

$125,810,294

Nebraska

Federal

74,152

87%

$354

$250

$104

$193,536,720

State-based using
federal platform

73,596

89%

$361

$242

$119

$190,213,278

Federal

53,005

70%

$385

$244

$141

$108,639,048

New Jersey

Federal

254,316

83%

$470

$306

$164

$775,094,132

New Mexico

State-based using
federal platform

52,358

74%

$323

$196

$127

$91,128,052

Nevada
New
Hampshire

New York

State-based

408,841

74%

$263 est.

$948,372,114

North Carolina

Federal

560,357

92%

$410

$315

$95

$1,948,697,503

North Dakota

Federal

18,171

86%

$369

$228

$141

$42,755,636

Ohio

Federal

234,341

84%

$389

$244

$145

$576,366,376

Oklahoma

Federal

126,115

79%

$295

$206

$89

$246,287,461

State-based using
federal platform

112,024

77%

$334

$198

$136

$204,950,148

Pennsylvania

Federal

472,697

80%

$355

$226

$129

$1,025,563,411

Rhode Island

Oregon

State-based

31,337

88%

$263 est.

$87,229,423

South Carolina

Federal

210,331

88%

$365

$278

$86

$617,464,510

South Dakota

Federal

21,393

86%

$358

$228

$130

$50,336,873

Tennessee

Federal

231,440

82%

$316

$213

$102

$485,079,725

THE COUNCIL OF STATE GOVERNMENTS

State

Health insurance
exchange

Individuals who
made a plan
selection

Average
monthly
premium
before
subsidy

% plan
selections
with tax
subsidies

Average
monthly
premium
after
subsidy

Average
monthly tax
subsidy*

Total annual value

of tax subsidies

Texas

Federal

1,205,174

85%

$328

$239

$89

$2,937,973,177

Utah

Federal

140,612

88%

$248

$159

$89

$236,093,172

Vermont

State-based

31,619

62%

$263 est.

$62,069,109

Virginia

Federal

385,154

83%

$348

$259

$89

$993,558,665

Washington

State-based

160,732

79%

$263 est.

$399,728,911

West Virginia

Federal

33,421

86%

$448

$311

$137

$107,265,368

Wisconsin

Federal

207,349

89%

$440

$315

$125

$697,563,506

Wyoming

Federal

21,092

91%

$550

$420

$130

$96,736,349

*Note: CSG estimated the annual value of tax subsidies in states with state-based exchanges using the $263 average subsidy under HealthCare.gov. Detailed
subsidy data were unavailable for 13 states in the March 10, 2015 ASPE report.
Source: Health Insurance Marketplaces 2015 Open Enrollment Period: March Enrollment Report, U.S. Dept. of Health and Human Services, Office of the
Assistant Secretary for Planning and Evaluation, March 10, 2015. http://aspe.hhs.gov/health/reports/2015/MarketPlaceEnrollment/Mar2015/ib_2015mar_
enrollment.pdf

THE COUNCIL OF STATE GOVERNMENTS