Health Care Spending by Those Becoming Uninsured if the Supreme Court Finds for the Plaintiff in King v. Burwell Would Fall by at Least 35 Percent

Research shows ruling in King v. Burwell could lower health spending by 35 percent. Eliminating tax credits would result in more uncompensated care, with less spending on hospitals, physicians, and pharmaceuticals.

The Issue

Health care spending would fall by at least 35 percent for those 8.2 million becoming uninsured if the Supreme Court rules against tax credits being used to lower the cost of insurance premiums. The analysis shows the corresponding drop in health care spending would significantly lower physician, hospital and prescription drug spending.

Key Findings

• $6.2 billion drop in spending in hospitals

   

• $2.1 billion drop in spending on physicians

   

• $1.6 billion drop in spending on prescription drugs

   

• Uncompensated care could increase to unsustainable levels.

   

Conclusion

Researchers estimate annual health care spending by this group of 8.2 million would fall from $27.1 billion to at most $17.4 billion. These estimates assume that uncompensated care would be funded at historic rates.

About the Grantee

The Urban Institute is a nonprofit, nonpartisan policy research and educational organization that examines the social, economic and governance problems facing the nation. For more information, visit www.urban.org. Follow the Urban Institute on Twitter www.urban.org/twitter or Facebook www.urban.org/facebook. More information specific to the Urban Institute’s Health Policy Center, its staff, and its recent research can be found at www.healthpolicycenter.org.