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17,000 Alaskans face risk of losing health insurance subsidies

  • Author: Dermot Cole
  • Updated: September 28, 2016
  • Published June 20, 2015

Robin Barker, a longtime resident of Fairbanks and Bethel, struggled with chronic illnesses for years that kept her from working. Her only option for health insurance cost nearly $800 a month for a policy that came with a $15,000 deductible. Prescriptions alone set her back $12,000 a year.

"Money was just pouring out of our retirement savings," she said.

For her, the world changed after Congress approved the Affordable Care Act five years ago. She qualified for a federal subsidy and a policy that cost her $42 a month. "I just sat down and cried when I realized what it was going to be. It was such a relief," she said. "The subsidy saved our lives. I don't know what we would have done without it."

Her husband, photographer Jim Barker, worked beyond the normal retirement age to pay bills, but the subsidies allowed them to hold onto what little remained of their retirement savings, she said. He retired this spring at age 78. She turned 65 in March and moved on to Medicare.

Interviewed at her Fairbanks home as she recovered from a bout with pneumonia, Barker said she was happy to qualify for Medicare but was concerned about Alaskans who won't be able to afford health coverage if the U.S. Supreme Court strikes down subsidies. If that happens, she says, "families will be destroyed."

"We were just lucky to get out alive. There's lots of people like us. My heart just aches for them," she said

The Supreme Court is expected to rule any day now on whether the subsidies provided through the federal health exchange to low- and middle-income people are legal. Alaska, one of 34 states that did not set up its own exchange, could see a new injection of chaos and confusion in the health care system. The lawsuit under review contends that subsidies are only valid in states that have established their own systems.

About 17,000 people in Alaska have subsidized coverage through the federal exchange, receiving annual tax credits worth $536 a month. That subsidy is $264 above the national monthly average, the Kaiser Family Foundation says. The average cost to the consumer after tax credits is about $105 a month.

If the subsidies vanish, the 17,000 Alaskans can expect premium increases of $6,400 a year, according to multiple studies. The U.S. average would be about $3,300, according to a recent study by Avalere, a health care consulting company.

Healthy people often think they don't need insurance, but those who aren't blessed with good health have a keener appreciation that insurance is the only thing keeping them from financial ruin.

If subsidies are struck down, people who aren't sick will be the first to drop coverage, while those who are sick will try to hang on as long as possible. There are already not enough of the former and too many of the latter buying individual policies, say the insurance companies, who want to raise rates by 20 percent to 40 percent next year. Extending coverage to sick people when there aren't a lot of healthy people picking up much of the cost is a prescription for higher and higher premiums, the companies say.

The state Division of Insurance says it has been working on contingency plans depending on the outcome of the court case, but won't reveal any details until after the court acts because no one knows what the court will say. Every day of delay from the court adds to the uncertainty.

Insurance Director Lori Wing-Heier said there are a range of alternatives under review and the state is "very committed to safeguarding Alaskans' access to affordable health care insurance."

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A word about this column. I've been a newspaperman in Alaska for 39 years, most of that time at the Fairbanks Daily News-Miner, where I wrote a daily column for more than 20 years, dealing with everything from state politics to weather. I covered many aspects of life in Alaska, as well as the environment, raising children, developments in business and stories about interesting people.

I've written books about the trans-Alaska pipeline, the history of Fairbanks, the first half-century of Alaska statehood and the 1908 auto race form New York to Paris. But writing under deadline pressure every day has been my life's work.

I moved to Alaska at 22 for what I expected would be a short visit in 1974, but one thing led to another and here we are. I had the good fortune to marry Debbie Carter, a Fairbanks writer. While we put off the honeymoon to build a cabin, we will have been married for 35 years in August.

We have three grown children. Connor is pursuing a doctorate in economics at the University of Michigan. Aileen works for Gov. Bill Walker in his Anchorage office. Anne just earned a bachelor's degree in biology from the University of Alaska Fairbanks.

I joined Alaska Dispatch in 2013 and have written occasional columns for Alaska Dispatch News since the news website and the Anchorage Daily News became one. With this column I'm beginning the next chapter as a regular columnist on these pages, which is something I have long looked forward to and am excited about.

I live in Fairbanks, but will be writing about issues and people from across the state. I plan to mix it up, dealing with whatever catches my attention at the moment and offering commentary and analysis. It's an opportunity to examine key issues and offer a point of view. In cases where we disagree, I invite readers to respond, as what we want more than anything at this newspaper is to get people thinking and talking about Alaska both today and tomorrow.

People, especially those who find some of my ideas wrongheaded, tend to wonder where they originate. On any given day, it could be a phone call, an email, something I've read or a chance conversation with someone who mistakes me for my twin brother, history professor Terrence Cole.

For inspiration, which may extend to readers as well as writers, I keep a copy next to my desk of the last column written by the late Red Smith, the great New York sports writer, who offered a columnist's credo: "One of the beauties of this job is that there's always tomorrow. Tomorrow things will be better."

The views expressed here are the writer's own and are not necessarily endorsed by Alaska Dispatch News, which welcomes a broad range of viewpoints. To submit a piece for consideration, email commentary(at)alaskadispatch.com.

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