Arizona has passed a bizarre new law in which the state effectively promises that if the Supreme Court destroys its health exchange, it won't build a new one, no matter how badly Arizonans are hurting.
Arizona is among the 34 states that did not build a health insurance marketplace, instead defaulting to the federally run Healthcare.gov. A pending Supreme Court case, King v. Burwell, argues that these federal exchanges don't have the legal authority to distribute Obamacare subsidies.
If the justices rule against Obamacare, they will be halting financial help in states that use federal exchanges places — like Arizona. The most recent figures estimate that approximately 205,000 Arizonans are receiving coverage through the marketplace. Of those, 76 percent are receiving subsidies to help cover the cost of their premiums. An adverse ruling would likely lead the state's exchange to collapse, as healthy, young Arizonans who could only afford insurance because of the subsidies pull out and the exchange itself enters into a death spiral.
But states have a way to solve this problem: they could build a state-run health exchange, and the subsidies would start flowing again. Except in Arizona, now they can't. House Bill 2643, signed by Arizona Gov. Doug Ducey on Thursday, specifically prohibits the state from ever setting up an Obamacare marketplace.
So if the Supreme Court rules against Obamacare this year, Arizona will arguably have no legal recourse or backup option to build a new marketplace.
On some level, this all a bit of a charade meant to symbolize how opposed the governor and legislature are to Obamacare. To build a state exchange, Arizona would have to pass a law doing so — and that law could simply include the language necessary to repeal this one. Even so, the message here is clear: Arizona's elected officials want to make it as hard as possible for the state to ever do anything to cooperate with Obamacare.
Gov. Ducey told the Arizona Republic that the state will have "a plan of action" to handle a Supreme Court ruling against Obamacare, but provided no further details, leaving local health-care advocates puzzled as to what that plan of action will be.