why many adults remain uninsured. many uninsured adults in the survey were unaware of the marketplaces, of the financial assistance available to them for health plans or or the medicaid expansion. we also asked adults who told us they knew about the marketplaces why they hadn't visited a marketplace. among those currently uninsured, 60% said they hadn't visited because they didn't think they would be able to afford health insurance. 39% said they didn't think they would be eligible. decision resolved what are the key challenges ahead for coverage and access in the united states? would be eligible.

37% were too busy, 28% said they didn't think they needed it. looking forward with the king versus burwell decision resolved what are the key challenges ahead for coverage and access in the united states? clearly based on our survey findings and other research, a major challenge for policymakers going forward will be covering remaining uninsured. in particular will we see some of the 22 states that have yet to expand medicaid move forward? and what do we know so far from states about the best strategies for reaching those who are eligible but not enrolled? peter lee is here with us today from cover california. he will probably provide insights what's working best in his state. another challenge will be the affordability of premiums and health care going forward. there was considerable variation in premium growth rates across the states in 2015 in the marketplaces. what do we know so far what is

driving this variation across states? in particular do state policy decisions make a difference? brian webb, with us today, may be able to provide some insights across the 50 states from where he sits. and on the out-of-pocket side will we see higher deductibles every year going forward? or are we going to instead see innovation and benefit design that will shift the focus away from deductible growth? many state-based marketplaces are struggling financially as the federal grant funding runs out. kevin and peter and panel lifts will provide states with share own marketplaces are approaching approaching this program problem. legal challenges to the law remain focused on cost sharing and subsidy reductions tim jost will tell us about. we're likely to see federal and state legislative efforts to change some of the provisions of the law. finally states may be able to address many of these challenges with so-called 1332 innovation waivers that will begin in 2017 that will allow states to try out new ways to formulate their own vision of health care reform. i will stop there and turn this over to ed. thank you. >> that's terrific, sara. survey data and summary of some of the big questions that remain. and now we're going to hear

from the panel who sara has just described. not only are they very distinguished, they are very nimble because when we first approached them, which we had to do because they're all very busy we didn't know which way the king v. burwell decision was going to come down. so they were prepared to address either eventuality and we, we needed to only refocus them on the original conversation when we started preparing them for the post-decision discussion. and you've already gotten a preview from sara. enrolled? let me give them equally inadequate introductions and then we'll not interrupt the flow of conversations. we'll start with tim jost who is emeritus professor of law at washington & lee university as of today. and writer of a widely-used health law textbook.

he also is a consumer representative at the national association of insurance commissioners. so he will bring a number of perspectives to this conversation. next to him is brian webb who is manager of health care policy and legislation at the naic. he has worked on the hill. he worked in a governor's office and both provider and insurance groups. on my immediate right, kevin lucia, research fellow, project director at center for health insurance reforms at georgetown's health policy institute. he also served in a state oversight capacity within cms for the affordable care act and next to him, and our final panelist is peter lee who as sara noted runs one of those affordable care act marketplaces established by the state as the phrase goes. state in question being california.

he too has held aca-related positions within cms as well as running a business collision on health and a noted consumer group on the west coast. gentlemen, thank you all for being here. let's start with tim jost to get the conversation going. tim? thanks for being with us. >> thank you, ed. supreme court's decision in king v. burwell is by now is old news but i would like to begin with a few observations concerning it. first as you all know the decision was not close. it was 6-3. the opinion was written by the chief justice and he was joined by justice kennedy who joined the dissent in the fnib case. there was however in the king v. burwell an outraged dissent. justice scalia as dissent was the same length, 21 page as the majority opinion. it is eloquent and well-reasoned. focuses on the phrase at issue in the case, exchange established by the case which

ed already mentioned. arguing that it could not possibly mean or include exchanges established by the federal government. scalia argued forcefully that his reading of the phrase was consistent with other provisions of the aca and could support one conceivable purpose of the law, to encourage states to establish their own exchanges. scalia's opinion could have been the opinion for the majority had it been able to convince justice kennedy and the chief justice but the chief justice looked beyond the narrow reading of the phrase exchange established by the state, to discern what in fact congress was trying to accomplish through the exchanges. he considered the context of the phrase, its structure, its purpose, how the and how these the wording was used in other provisions of the act. in particular, he examined the provisions of the aca regarding the creation of the federally-facilitated exchanges which are to take the place of and perform the functions of the state-operated exchanges. chief justice roberts nowhere referred to the brief filed by the democratic members of

congress in which they clearly stated their intent, that the federally-facilitated exchanges would grant tax credits but he clearly grasped what congress was trying to do and how reading the statute as justice scalia would have defeated that purpose. the chief justice concluded his opinion by saying, and i quote a fair reading of legislation demands a fair understanding of the legislative plan. congress passed the affordable care act to improve health insurance markets, not to destroy them. if at all possible, we must interpret the act in a way consistent with the former and that avoids the latter. section 36-b can be fairly read consistent what we see as congress's plan and that's the reading we adopt. from the standpoint of legal analysts perhaps the most interesting aspect of the decision is that the chief justice did not rely on what is

known as chevron deference. it is a commonplace in administrative law when the meaning of the law is unclear the courts refer to the administrative agencies charged by congress with interpreting the law and that is the approach that the fourth circuit took in this case. chief justice he roberts rejected this approach effectively saying questioning of authority of federal exchange to tax credits was too important an issue to leave to the irs and thus decided the issue for himself. what this means for the law generally is being debated by legal scholars but at least it means that the chief justice intended to nail this issue down and not leave it to be reopened by later administrations. so where does this leave us? first there is a lot of aca lawsuits still spending. several of these cases are in their death throes, such as two cases challenging the aca under the origination clause of the

constitution claiming that the aca was a revenue bill that did not originate in the house. this claim has been rejected by the panels in the fifth and d.c. circuit but those cases are pending for rehearing en banc in those circuits. a string of other cases have been rejected by federal courts mainly on jurisdictional grounds with the courts recognizing that the plaintiffs are simply trying to raise political grievances and have not themselves been some promise of going further but that don't fundamentally threaten the aca like the 100 or so cases challenging the contraceptive mandates. the administration has now won a string of decisions in the circuit courts upholding its most recent accommodation of religious organizations but the supreme court on monday entered an injunction limiting the enforcement of the rule pending the court deciding whether to grant cert in one of those cases so we may be hearing more about that one case that sara

mentioned is worth watching is house v. burwell. the house of representatives sued challenging administration delay of employer mandate an provision of cost-sharing reduction payments without explicit appropriation. the delay issue is essentially moot. but the cost-sharing reduction payment issue remains important. as sara noted nearly 60% of exchange enrollees get cost sharing enrollee payments that make health care and just as opposed to health insurance making affordable. csrs are technically played to insurers must in certainly legally reduce cost sharing. a decision against the administration would not necessarily end cost sharing

reduction payments but would put insurers of untenable position providing them without compensation and cause massive premium increases across the premium increases across the individual market. the government has moved to dismiss based on precidential holdings that members of congress can't sue if the executive interpret as lay differently than they do. congress has many ways enforcing understanding of the laws when it disagrees with the executives without getting courts involved but judge come letter who is hearing the case has shown some interest getting to the merits and asked for supplemental briefing. the arizona redistricting case which was decided by the court on friday or monday, has some language that is on standing of legislatures which will be cited by both sides in support of its position. another consequence of the king decision is that the states can now decide whether they prefer to have a federal exchange without having to worry about the loss of tax credits. pennsylvania has already broken off its tentative efforts to establish state exchange and it's likely several states including hawaii or vermont may opt for a federal exchange as

well. others like oregon, nevada, new mexico which are using healthcare.gov platform may also go further moving toward a federal exchange. when the law was adopted in 2010, many states considered setting up exchanges to retain control over their insurance markets but the administration has consistently interpreted 2010, many states considered law so to interfear minimally, brian may disagree with me on this with state insurance oversight. so except for states that have particular vision of how the exchange should be run, like california, there is perhaps little reason for states and in particular small states to struggle with exchanges financing and operation if the federal exchange can run the exchange for them. the battle of the aca is far from over. this is just one small battle and the war goes on. appropriations bills that would defund the aca are moving through the house. bills that would limit funding

is moving through the senate and reconciliation bill will likely follow late this month or next. the aca faces major challenges over the coming months. yesterday the administration released information on the premium stabilization programs the risk adjustment reinsurance or next. program. health affairs a few minutes ago on that. i have a post that went up with thank you. >> all right. brian, tell us more about this

life and death crisis. >> that is quite an ending there. >> we have had a lot of them. >> that's right. well, thank you. again i'm brian webb with the naic. just to do a little poll here, how many have the foggiest idea who your insurance commissioner is? i'm not quizzing you. make me feel good? get your arms up. they're a good person to know. your insurance commissioners are ones really do know what is going on in your states, what is going on in your marketplaces and they're the primary regulator to make sure consumers are protected and the markets work and that's really what they're doing right now. as we look towards 2016, there is some deadlines coming up and your departments of insurance in each of the states are working feverishly to make sure that the plans that are going to be sold in 2016 meet all the requirements, will be solvent, will protect rights and abilities of the consumer and that they will have healthy marketplaces.

some of the deadlines we're looking at postively have passed. rates inside and outside of exchanges had to be filed by may 15th and they were. so they were submitted. then start the process of reviewing those. but first they had to be posted. any rates 10% and above had to be posted at the same time. again that is inside and outside of the exchange. any of those 10% above had to be posted at the same time. that was kind of a new provision. but we did that. they were posted june 1st. some state-based exchanges came a little later. june 19th. some are waiting for them to come out. for the most part they're out there. just a note there. those are jutt 10% and above. there are a handful of states

made all rate requests including for new plans and decreases and those below 10% available but, what is out there right now is primarily just a 10% and above. also as was mentioninged reinsurance and risk adjustment data came out yesterday. this is important. this kind of tells us, give us and idea how much they will collect under reinsurance and idea how much they will collect under reinsurance and then who is growing to get that money in the individual market. it tells us in the risk adjusted program who will get money, who will pay money. this is important and this is for 2014. really rates for 2015 and 2016 have been submitted with just assumptions, projections guesses as to how these programs are actually going to work. in fact there are states who are going to allow companies, now that they have the 2014 data, to

make adjustments to their 2016 rate submission based on new data. maybe they have a little more information how that will affect them. there will still be some interplay here as we go forward. they will be fully reviewed. we'll get into that in a minute. all of them have to be finalized and qhps must be submitted by august 25th that is kind of the next big date when things have to be finalized. all the states are trying to make sure all the rates, all the forms are approved before that date so companies can get those in. now final rates posted. they have to be at the same time. all final rates have to be at the same time. you may see some rates after that august 25th date start being posted by the states. as long as they're uniform they can post them at anytime before open enrollment. now the agreements won't be signed with the qhps until september 21st or 25th. some may wait until then. if the states haven't posted them, feds will post them after open enrollment, sounds like a

day or two beforehand. if your bosses are curious rates, when will we know, what will they look like? in some cases we may not not the final until couple days before open enrollment. some will post before that. open enrollment starts november 1st. what goes on in the states right now? they're looking at rates. as you have seen in some press releases they're going up. some are requesting higher. everybody is nervous about what it is going to look like projecting what the average rate is going to be. all of those are currently under review. none are final. first they're looking are they compliant with the law. there are rating rules in place. age can't be more than three to one. can't rate based on health factors, those kinds of things. states will make sure they're compliant with the rules. of course, other thing we're looking for, are they acutarily sound? they have to be signed by an actuary who puts their reputation and can career on the line, that yes this complies with actuarial guidance and

methods. we think this is an honest, good rate request. then they're going to look to see if they're reasonable. obviously there is a lot of assumptions and there can be difference of opinion on assumptions but are they reasonable? are they reasonable again for things like risk adjustment and reinsurance? are they reasonable for morbidity? are they reasonable for projected claims? are they reasonable for projected costs? and they will go back and with companies over that. let me circle the next one. this is the big one, it comes down, are they sufficient? insurance commissioners want to make sure if somebody buy as plan, it may be a really low-cost plan, may be too good to be true and that's a problem. if it is too good to be true this plan will go insolvent and literally nothing to cover

anybody. so they want to make sure all these plans, their rates are sufficient to cover their projected claims. so that is something they also go through. then of course that they're non-discriminatory. they're set up in a way you're not trying to a certain segment of the marketplace in the way you design various rates. that brings us to the forms. the forms, think of those as the contract. what are you going to cover? they're reviewing those as well. they go through them with a fine-tooth comb, going through every provision, every disclosure, every part to make sure first of all it is compliant. does it include essential benefits if it needs to? does it include all preventative services? does it cover without cost sharing like it is supposed to? they look at network adequacy. they want to make sure they have sufficient networks to provide services that they are going to cover. also want to make sure that they provide information to consumers that's accurate about those networks and about formularies et cetera. and then there are a lot of disclosures. consumers need to know. summary of benefits and coverage

is one kind of disclose sure out there and we're working on that to make sure that is informative. there are other disclosures about what isn't covered by this particular plan. you need to make sure those are clear and accurate so people can make good decisions. that's what it comes down to. can regular joe on the street go on the exchange, get the information, look at the contracts and make a good decision? and then of course they need to make sure the benefits are non-discremmer to. -- non-discriminatory. this has become an issue that we're looking closely at. there was a lot of issues down in florida with the way the formularies were designed where basically all the hiv drugs were in the highest tier. that appeared to be discriminatory. are there other kinds of ways you way you set cost sharing way you set up benefits? any kind of limits to where

they're discriminatory. we're looking at that as well and getting better at that every year. other issues too. just as we move forward, as we work first of all with the federal government, there are concerns about state and federal coordination. i think everybody would agree if you have too many regulators all asking the same question but slightly differently that is not really good for anybody. this will increase cost, there will be confusion and we've had a little bit of that as you can imagine but we're going to keep trying to get better than that to make sure we're working and coordinating when it comes to market conduct reviews, when it comes to plan reviews, form reviews, et cetera. network adequacy remains to be an issue. want to make sure up front consumers have full, clear accurate information about who is in the network before they make their decision and then also that they have a network that they can go to for their various needs during the year. naic is currently in process of updating our adequacy model. that is open process. anybody can participate. if anyone wants to take tim's place he is more than willing to give up his slot.

we're going to four hours a week on this, network adequacy. we hope to be done by end of the year to have a good standard model for the way we insure network adequacy. definition of small group is chaining january 1st. don't know if you're aware of this. aca requires going to employers 1-100 employees. now it is 1 to 50 employees. if you're an employer with 51-100 employees your benefits will change. small group ratings changes. go into single risk pool. a lot of changes. there has been transition offered by the administration to allow those to continue through really october 2017 but, there is a couple of bills out there that we recommend. naic endorsed changing the aca to go back to 1 to 50. want to point that out. we're currently process of

changing essential benefits from 2017 and beyond. this is put out in proposed regulation. people will be commenting on that and posted by end of the year. state innovation waivers have been mentioned. states need to start looking at that not just wholesale we'll change entire aca and not do it. but, what ways can states change certain provisions. that is what they're looking at, we never have enough time for it is cost. what will we do about cost? that is something people will take a look at as we move forward. so that's what i have. >> that's a lot. thanks very much, brian. turn to kevin lucia from georgetown. >> is this on? great, thank you. so, yes, i'm at georgetown university and we run, we're

very fortunate to have funding from the commonwealth fund to run a program where we're allowed to watch how each state at a high level is implementing the affordable care act both the broader market reforms and also how they're setting up exchanges and all the decisions, legal policy decisions around that. so today, i would like to just share some kind of high-level thoughts on the financial sustainability going forward post-king. some of the transition and my thoughts a little bit what we can expect from that front. also, just some consumer challenges that we've been starting to focus on. network adequacy for sure over past couple years. also balanced billing and continuity of care. just to wrap up at end a pitch for more data available coming out of issuers to help policymakers make their decisions. so, post-king, over the last week, we keep getting the same call, what is the incentive now for a state to maintain their

status as an sbm or to, or to transition to an sbm? you know for some like hawaii as was mentioned, it looks inevitable. they will move on to the federal platform. for others like vermont it really comes down to a question of control and vision. so vermont is a state-based marketplace. they had a larger vision where they wanted to bring their entire health care delivery system going forward and but they have been having some serious i.t. problems. so do they move to the federal i.t. system or do they continue to try to buildout their sbm and improve their i.t. system? i think it will come down to do they want to maintain their vision of control, their integration with their medicaid program which you really can't get just by using federal platform. you have a better chance of kind of reaching that level of

integration if you're developing your own system. so some states like vermont may maintain their sbm status and continue to try to buildout their own system. arkansas is another state. they're marching forward to build a state-based marketplace. they need a local solution to kind of realize their vision on their medicaid and how they integrate with the medicaid program. i think we'll see differences depending on the state and kind of what direction they want to go as far as fulfilling vision at local level. financial sustainability the questions are also very, very challenging. we're seeing significant variation between states from 10 million in idaho to 30 million in d.c., to 80 million plus in maryland to maintain their state-based marketplace. many states have basically adopted an assessment that's linked up to be rolement and premiums.

-- enrollment and premiums. if the enrollment goes down, their budget go down, can they maintain the financial situation going forward? now that king is done what we'll probably see many states starting to look internally about how they can affect their cost drivers seem to be on call center front and i.t. maintenance fronts. but also looking at other states successfully been able to maintain their financial status like california. what's happening there. what can we learn from there? how are they dealing with these cost drivers? >> so, no doubt about it back to the narrow network issue we are in an era of selective networks. so for consumers, what has this meant? so up until certainly the first year continuing to second year inaccurate and out of date physician directories.

plan labels like hmo's, ppo's, epo's, they don't really tell you a lot how robust the network is. and very common complaint was, consumers really didn't realize that their physician was not in the network until after they purchased the plan and it was difficult to get this information from the insurer. other, and i list a couple of other commonly complaints that we heard in the media. so georgetown last year went out and published a report to figure out what were the actual network adequacy standards on the books at the state level? we found just about half of the states had what we call quantitative standards and, and that is like the maximum travel time and distance to get to a doctor, 23 states had that. provider enrollee ratios, 10 states had that. maximum wait time, 11 states had that in place. some of these standards didn't necessarily apply to all qhps

offered in the marketplace. some only applied to hmos so we're interested watching outhow -- how states move forward on this front, if they will adopt new protections, what, where the naic wins on their model law. and what we did find outgoing forward through 2014 very few states actually moved forward on creating new standards. arkansas and washington, they had new quantitative standard that went into effect in 2015. california doi filed emergency regs that implemented new -- network adequacy. we saw a number of states, california, nevada, new york and washington that beefed up their oversight so they were empowering regulators to beef up

their networks and engage insurers on this front and we saw five or six states that addressed provider directors. new york mandated that provider directories had to be up to date within 15 days of changes. policy directives going forward on the network side, there isn't -- it's a complicated space, the network adequacy space. there isn't a lot of data that clearly points to what works for which state and which region. also for better or for worse networks affect price so there's a balancing act between price and access and choice that i think regulators have to get their head around and finally transparency of provider directories, it's really difficult. everybody seems to want and think that it's kind of a no-brainer to have up-to-date directories but if you took regulators and issuers and

providers, it's very very difficult logistically to keep these provider directories up to date. some states have been innovative. d.c., for example, is working with a third party contractor to kind of collect all the information from the issuers and providers and put it into a seamless box that is rabble for -- available for consumers and other states are following suit. balanced billing, so 10 years ago, georgetown reported out on how states were regulating around balanced billing and we were mostly interested in how people were being protected in the e.r. setting so when you go to e.r., you go to a par hospital and touched by a nonpar provider and that provider doesn't have a contract with your insurer so they can bill you what they want or above what they're paid and the same thing was happening in network hospitals. a woman goes to the hospital to have a baby and the

anesthesiologist is out of network and she gets a 2800 dollar bill so we studied this 10 years ago and i think the hope was that the a.c.a. would take care of it but it didn't. cost sharing includes the cost sharing limits includes those fines related to co-pays deductibles and coinsurance but don't include balanced billing so this is an issue now, there's no federal protection and state protections vary. only about a quarter of the states have some protection against balanced billing and sometimes it varies depending on the setting. there's been recent activity around this issue. new york, connecticut, new jersey had a very comprehensive bill that failed but i think this is an issue as we start to go into more selective networks, we're going to see possibly an increase in balanced billing and it will be interesting to see how states try to deal with it. continuity of care, and this

is -- this is destructions of ongoing care during active treatment when either a participating provider is terminated from a current plan or when a provider is not participating in a new plan so asking people to go back to shop on the marketplace we want to to make sure people undergoing care for whatever reason, post-maternal care, mental health issues, that there's some kind of continuity of care to allow them to transition into that new plan and certainly if we're going to allow flexibility on networks, then we need to make sure at the state level that states are protected when a provider is dropped. so that provider can continue to treat that person that's covered under a q.h.p. at least temporarily. the federal government, the feds, are on this, i think and in the 2016 guidance they're

encouraging issuers to have transitional policies. state protections vary significantly. i would tell you that d.c. health link, the d.c. marketplace, did put in a policy that basically requires 90 days of continuity of care for people switching between plans and i think that's an important step forward for that state and other states may follow. finally, i'd like to finish up on transparency data, make a pitch for this. there's a provision in the affordable care act 2715a that basically allows the collection of significant amount of that information really i think the vision was to help understand the behavior of issuers and the experience of consumers to inform policymakers. that provision has not been implemented. there's some work going on at the naic to figure out what data should be collected to inform

implementation of 2715a but it's not with us yet so hopefully this information and this provision will kind of see the light of day in the next year but you can understand if you have the right data when you're making decisions about balanced billing, when you're making decisions about network adequacy when you're making decisions about changes to continuity of care provisions, it could be good to know exactly how many people are experiencing those issues and how issuers are setting up their plans or paying claims to influence how people experience those specific situations. >> turn now to the guy who's really working one of these state-based exchanges, peter lee. peter, thanks. peter: thank you very much and thank you to the alliance and commonwealth for having me here and thank you for joining us. i say often in california is

that we try to do evidence-based policy making and wish the same of all of you. i will give you stories of what's happening cra. i was daunted to recognize that open enrollment starts in four months so i need to leave in five minutes. i would note that i have additional slides that i'll refer to as i give remarks. i want to start by noting that we in california very much believe we are not just about giving people insurance cards. we believe in the triple aim, try to encourage better healthcare to be delivered better health and lowering costs that. drives a lot of the elements of the affordable care act. for all exchanges, there's four elements that i think go into their success -- how they are a purchaser. we are a very active purchaser. doing effective outreach, getting people in the door, making sure you have affordable products and making sure people are getting the care they should. when i say being an active purchaser, there's four key

elements and only half a dozen states that are active purchasers in different rings of the spectrum. first selecting plans. we turn plans away. we don't take any plan that wants to play. they need to show good prices and something meaningful. second we negotiate price actively. we're in the middle of doing that. third, we standardize benefit designs beyond essential health benefits and actuarial tiers, we have standard designs and fourth we have contractual provisions that push our plans to change the delivery system. we recognize in the end healthcare is delivered by doctors, nurses and hospitals and we think it's our role to be an agent in partnership with cms, medicaid agency and private purchasers in changing outcomes delivered so that's a role in being an active purchaser that different exchanges have different philosophies. before talking about california, there's been so much talk post-king about what's going to

happen about state-based exchanges. some of the main core functions that may be easy to do nationally or regionally and others are local. to my mind there's four key functions that an exchange does that needs to be supported. i.t. the website for enrollment healthcare.gov has a very good functioning enrollment site as well as california and connecticut and kentucky. that is not location specific except for interface with medicare program. second, customer service people answering your phones. in california we have state employees answering phones for california enrollees. every other state contracts with a private vendor to do that service. it's a big service and a third of any exchange's budget. third, marketing and advertising, outreach and enrollment. that is never national. that's a local effort. it's local insurance agents,

it's local faith based groups, it's local advertising in a market. it's a local effort. finally purchasing. selecting plans, negotiating contracting, even if you're a light touch, knowing the plans in arkansas is different than knowing those in california. that's a location-specific effort so i'd warn you of saying oh all these state-based exchanges will be federal. certain things don't go federal. healthcare is local. marketing is local. outreach is local and that's something to remember and i note kevin did a very good outline of budget issues. about a third of our budget which is about $330 million in this fiscal year which started today is one third each in i.t., customer service and marketing. it's a lot of money but you need to do outreach forever. let's bring you to california. this is hard to read but i want to note one of the things the president said after king v

burwell is this no longer about obamacare or the affordable care act but healthcare in america. this is very true in california so in california we saw the number of unanswered decrees about in half. we saw the medicaid program grow by three million the orange bar. we saw the individual market expand dramatically from 1.5 million to 2.2 million. of that, 1.3 million are covered in cover california. we saw the employer market decrease a little bit. i'd note in our uninsured and i think i'd note sara's note about the number of latinos uninsured. more than half of our uninsured are not eligible for subsidy because they're undocumented so we'll have challenges addressing all the populations across the country uninsured if we're not addressing undocumented so eligible for coverage is 1.3 million left so we're changing

healthcare for many folks. cover california is big. we're obviously a big state. we have 1.3 million insured today. we are the second largest purchaser of healthcare for those under 65 after the medicaid program in the state of california. that means when we talk, healthcare plans listen. it means we have the budget to do outreach. we have $6.5 billion in premium. we're a very going proposition. since we opened our doors, 1.8 million people have had coverage. some for two months, some six months, meaning 500,000 that are not covered today have used our services. that's exactly what we thought was going to happen from day one. the individual market is a market with churn. people there are, some of them temporarily because they're in between jobs. others are there while their income is adjusted, income drops, they're in medicaid.

500,000 is part of what any exchange is doing, being the glue holding the employer based system together with support from the public sector. the other thing i'd note is we have plan assessments to support our operations, collecting them from january 12014. we have over $200 million in the bank. unrestricted we can use as we please. our state law says we cannot now nor ever use state tax funds. we knew that from day one and developed our budget to be financially independent. we have about $100 million of federal establishment funds we're still spending as completing the establishment process. after that, we're on our own and running just fine, we can dial up or down our plan assessments and the plans want us to dial them down but we are the cheapest date in town in terms of getting enrollment in the individual market that used to be very expensive. enrollment how did we do? we did a good job. on the right-hand side of this

chart is the ethnic mix of those eligible for subsidies. 38% latino. 34% white. 21% asian pacific islander. second open enrollment period, 37% latino, 18% asian 5% african american 34% white. we enrolled people reflecting the diversity of those eligible for subsidy. how? it was hard work with radio, tv, on the ground work, insurance agents in every part of the state, working together to get the word out and the word is largely out there. for those that didn't sign up, the commonwealth data i think is spot on. it's people that still don't believe healthcare's affordable. something we'll work on continuously. so let me talk briefly about being an active purchaser. we're a big state with 19 rating regions, virtually any of those regions is the size of many states around the nation. those rating regions have

anywhere from three to six health plans in them. in 2014 we turned plans away that wanted to be in our marketplace. in 2015 we turned plans away. we'll see if we turn plans away for 2016. last year, our average rate increase was 4.2%. it wasn't bouncing up and down for a lot of folks because we look very closely at what the plans bring forward. i'm very optimistic for next year because we have a good risk mix and that's exactly what the reinsurance pools were supposed to do, give the, in essence feed funding to have low rates early on to get a good risk pool in to have affordable costs on a go-forward basis. out rates will be announced the end of july so stay tuned for that announcement. next issue be an active purchaser, standard of about design. this is really important. there's a lot of talk about do consumers have access to care because these plans -- and these are not just exchange plans but

plans for employers -- have big deductibles. in blue and look at this in detail later -- are the sorts of coverage not subject to deductible. if you are in any silver, gold or platinum plan no care you receive on an outpatient basis is subject to a deductible except specialty drugs in limited cases. the only thing subject to deductible is going to the hospital. every plan in cover california has the exact same benefit design and by law in california the exact same designs have to be offered off exchange even by plans not in cover california. those plans can offer other products off exchange but they must offer this exact product so consumers can compare apples to apples plans they're shopping for off exchange. this is a huge benefit to consumers so what's it mean for affordability? it means many consumers are

paying very little to get very affordable coverage. we have 120,000 people paying less than $10 a month in bronze plans. 70% of those that have subsidies are picking a silver plan. many of those in the cost sharing subsidy you heard about earlier where in california at the highest cost sharing subsidy, an outpatient visit is $3 a bus ride. that's not a barrier to care and there's no deductible. i would encourage you to look at the background slide. this is not the story across the nation. we looked at colorado and miami. instead of having seven products like we have in l.a., in denver, they have 35 different silver products. in miami, 35. and some of those products that are the cheapest premiums mean you don't get any care unless you've satisfied a $3,000 deductible. that's not good for consumers. standardized design is something active purchasers do and i think

is right for consumers. let me note about accesses to care. we have very early indicators that are very positive in california. there is a lot of discussion about narrow networks. i note virtually all of our plans to some extent have a not-all-in network. i think that's good for consumers if you give consumers the tools to understand who's in. in california, 91% of our enrollees said they could find healthcare from a usual source of care close to them identical to the number of people that said that in the employer insured market 91%. identical rate. 9% cannot find local care the same for people with employer based care and often issues that are raised as exchange issues, you need to pause and say, is this an exchange issue or is this a health insurance in america issue, like balanced billing and other issues. these are not issues subject to exchanges. in terms of getting care i appreciated the commonwealth study that 86% of those newly

covered were sweavd their care. i think that's the case and some aren't but 86% is a pretty good number. i'd ask you to compare that to employer based coverage individuals. my bet is it's similar. we're seeing people in california getting access to care. those in medicaid, meddical in california and cover california, 60% as of october had gotten preventive services, over 70% had seen care. those rates are identical across the board. i want to note on delivery reform. we have in our contract with our plans what's called attachment seven that lays out a range of requirements of the plans to tell us what they're doing and making sure people get care that's appropriate based on culture and language. we also, in california, back to kevin's point on transparenc, have a requirement that every plan get a third-party vendor every piece of their claims data held totally confidentially to

be analyzed to see which plans are doing a better job to serve diabetics, is it different by age, ethnicity or income? we'll analyze that data and it's something the government should do to understand is the right care being given at the right time and raising the bar to see what can we do with c.m.s. with medicaid with private purchasers to make sure they're getting the right care, making sure people get the right care at the right time. thank you very much, i look forward to your questions. >> we have the opportunity to ask questions to the panel. there are microphones you can use to ask your question. there is a green card you can fill out.

you can tweet a question and i invite my commodderator to jump in with questions as she has at this point. i don't know if you want to start us off but you have the opportunity if you would like. >> one question i'd like to ask peter, we know that people don't understand their insurance policies very well, just from our surveys. in particular, people don't understand their deductibles very well so california's been innovative in terms of excluding outpatient and primary care from their deductible. do you know how well people understand that exclusion. peter: it's a really great question. the kaiser family survey results asked people did they understand their benefits. 75% said yes. i'm not sure if i believe that, quite honestly. the good news in our last open enrollment year, 70% of people

that enrolled enrolled with help from an individual. some with an insurance agent and others with navigators. those people were trained to describe the benefits of choosing a cost sharing subsidy plan so you'll note 70% of those eligible for subsidies picked silver. a quarter picked bronze, for many of them, they literally had healthcare coverage for free because they took their advanced premium tax credit and applied it to the bronze plan because they had informed interaction with a trained counselor to help them make an informed choice. i think one of the challenges we all have is to improve health insurance literacy but early indications are pretty good. >> if i could respond briefly. one of the other initiatives at the naic is revising the summary of benefits and coverage and the affordable care act provided that every plan have to have a summary of benefits and coverage that is made available to

consumers, to decide which plan is the boast for them and better understand their plan and the agencies proposed to revise that last year and at the request of the naic, they turned that over to the naic, the job of revising it and that's another group, the naic, that's meeting three hours a week to revise the sbc but one of the major focuses of that effort has been to provide better information to consumers about the deductible and how it works and what is covered by it. >> yes, and i would ask those of you asking questions from the microphones to identify yourselves and if you have an institutional affiliation mention that. >> dr. caroline pomplin, primary care physician. i have a narrow question and broad one. the narrow question is to the lady from commonwealth. when you do your surveys, how

satisfied people are with their insurance, do you ever break it down by people who are sick versus people who are healthy? very often healthy people are satisfied with their insurance because they've never had to use it. the broad question is, you described a very complicated system -- many plans, many regulators many regulations. has anyone ever calculated the cost of the whole bundle -- the government part, the time people spend choosing their plans, the regulations, how all these transaction costs compare to say, medicare, where, for medicare advantage but even medicare advantage everyone has to get the same benefits. medicare advantage can add on a little bit but there are no risk corridors. it's much simpler.

we've looked at cost of this and cost of that but i wonder if anyone has looked at the entire package of costs we pay to have various plans and to consumers picking every year. >> i'll start with your first question. i think that's a really important question and we do look at health status in our service, how people rate their health. we ask people how they rate their health and ask if they have a chronic health problem and look how they answer questions. we find people who have health problems know their plans really well and are more likely to have used their plans and we've asked, for example, whether or not people feel like they're better off now with their new insurance coverage. people who have health problems are somewhat more likely to say they were better off than they were before and i think that's partly because they're more likely to have used their plans. the other important thing to

keep in mind is we asked people who had insurance before getting their new policy whether they could have gotten that coverage that their new health insurance before people who had used their plans, whether they could have gotten the care that they're getting and what we see is nearly half of people who had insurance before getting their new plan so they wouldn't have been able to access that care before so i think what you see in a lot of these data are people who had insurance and had really crumby plans before, maybe had diabetes care excluded from their benefit package so seeing themselves with somewhat better access to care than they had before. >> with respect to the second question, there is as you would expect a huge literature on that question and it breaks down pretty much along ideological lines. i think it's hard to argue with the fact that most countries in the world spend a great deal less on healthcare than we, do they operate it through programs that are either government run

or very closely supervised by the government and they have healthcare that is every bit as good as ours, sometimes better. on the other hand, you can certainly find literature that shows that public programs impose very high costs of various sorts and, you know, this is just a perpetual argument but i think the issue here is really more political and economic. we are not going to get a national single payer system in my lifetime. so there we are. >> we do have medicare. >> do i have medicare? >> we have medicare. >> we have medicare, yeah. and there was a debate in 2010 to extend that to everybody and i don't think -- it never got to a vote. it wasn't close. but, yeah, here we are.

it's the people in this building. >> i believe you were next. >> from george mason university. my question for all the panelists, specifically mr. lee. >> you want to get closer to the microphone. >> my question is, regarding the waivers for 2017. what can we expect with those waivers? what changes are states likely to make? and then is there a difference or will there be a difference if it's a federal exchange versus state exchange? >> i would ask, whether it's peter or one of the other guest experts to say a couple of words about what the nature of these waivers -- for those of us who aren't necessarily students of section what was it? 3518b? >> so i'll briefly -- this is actually just in the beginnings of being explored by all the

states soive -- every other week, i'm on calls with every state exchange executive director talking with the federal exchanges, as well. the range of the latitude that these waivers provide is pretty broad but it's not limitless. there's guard rails and states are looking at anything from narrow opportunities to do things like fixing the family glitch which is a provision that actually excludes subsidies from families where one of the spouses has employer based coverage and the rest of the family doesn't to much more broad programs to try better integration between medicaid and the exchange program so there's a wide spectrum being looked at and we are barely starting down the path of looking at that right now but focused right now on open enrollment three. >> i'd like to add, the commonwealth came out with an issue brief, gosh about two months ago on 1332 waivers and it's great introduction and talked about the guard rails on these decisions and i

i would agree with peter this will probably be a range some states really going for everything under the states making small tweaks. to issues that are bothering them and what they're saying coming out of their enrollment. i would say because we taxpayers, we have seen about 10 states that either set up task forces or at least acknowledge publicly some the things that are considering in public debate to their exchange board meetings. so there's definite activity taking place at the state level. i think they're waiting for the fed to give more guidance. we don't have the official, we'll have anything further than that. we will know more in the next couple of months i would say. >> i would say in response to that that the 1332 waiver process is probably going to be the factor that is most influenced by the next presidential election. we are going to get some regs

before the election. there's a lot of talk about 1330 to waivers but if you read the section, there's not a lot of wiggle room. basically you have to be able to provide at least as good coverage to please as many people without causing a greater budget deficit for the federal government. it's pretty hard to imagine a program, for example, that is based on health savings account or something that would ever meet the requirements of 1332. i mean single-payer system maybe but nobody is going there. and so one can imagine that if we elected a president who is hostile to the affordable care act, that they would exercise a great deal of discretion in trying to allow states to do all kinds of things under the 1330 due process but i would expect that if we elected president who is supportive, it's going to be

construed as it's written, as a fairly narrow opportunity to improve on things but not to abandon the affordable care act and go in a completely different direction spirit are a little more optimistic. we believe it is latitude. we have seen it, even in this administration i would say very supportive of medicaid and supportive of the a ca, under 1115 waivers have been very broad and working with the states and i think this administration, next administration whoever want to work with the states to come up with something that makes it better for consumers, more competitive, better markets. states can come up with positive changes that will move things forward. that may be easier to do and even doing major changes here at the federal level. >> i am an intern at health and human services.

i have a question that specifically addressed, ma but also to the panel in general which is mr. lee, you mentioned at the beginning of a bit of a specialty drugs. that's an issue i have been working on in the office. i was wondering, under the california recently was trying to reform their policy regarding specialty drugs especially with the new wave of cholesterol medicines that have the potential to impact millions of people. what ideas do you think could be implemented at the state and national level in order to regulate the cost of these drugs and the impact on the health care system? >> great question. california's standard benefit design. we don't make many changes each year but for 22nd we made a our tears and across all the plans. these are standard eyes, they will be in place as of january

1, 16. this means the entire individual market in california will have caps on specialty drugs. we did this really concerned come one come we did want to have consumers caught in the middle but we are very concerned about the pricing of specialty drugs. we are very worried that some of the pharmaceutical companies are making profits hand over fist that when you compare that to the restrictions on profits being made by health plans, i look at the profits in

california, profits between one and 3% the icing pharmaceutical countries having profits of 100%, profits. profit. that is something that i think we look at as we can buy benefit designed can buy benefit designs but beyond my pay grade or something of issues, this is one of the major cost drivers of future health care costs in the nation. >> if i could follow-up on that. i think this is such a fascinating example where and innovation occurred in covered california and i just wondered what the potential is of it spread into employer-based policies in the state? >> it's a great question. this is one of the issues where a number of employer-based benefit designs already had caps. some did and we looked at what was in place in large employers and small employers in the market and there were a number of employer-based benefit

designs that did just this, had caps in place. what we did, generally, exchange is have actuarial value, plans that are less rich an average large employer plan. that's what 70%, not the large employers, like 80, 90%. we need to look at making good access to give. doing things like what we've done under deductibles specialty drugs, to make sure the lower value than the average large employer plan, doesn't serve as a barrier for getting access to the immediate care. >> thank you. >> by the way, we're down to the last 10-15 minutes question time. and if we do have to leave, and as you were listening to that last segment i would appreciate your pulling up the blue format the layout the evaluation for

us. yes, i believe you were next. >> my name is jacob bradshaw. i'm here for the national alliance on mental illness, and i have questions about two concerns we have been having. the first is in regard to transparency for the medicare and medicaid networks. because we get a surprising number of calls from people who have called it the state medicare and medicaid office and have informed us that they been told that there is no directory available, and that they told them to called my nonprofit organization for a list of treatment referrals. and in the other concerned that we have is in relation to the institutions from mental disease exemption with medicaid, and have future plans for the aca may help to alleviate that. >> co-head, tim. >> no, i was just, i don't deal with medicaid.

i don't think that any of us do in our work. we work with private insurance. i realize these are serious issues but speed let me take pashtun we would very, very close with our state medicaid program and in california which is a case around the country at a lot of places medicaid programs were contracting with organizations and if the requirements in california that provider directories, provide information be made available. the issue of medicaid is a federal issue and begin a major risk plans i think cms regulates the availability of provider directories to i have no clue on your second question though. >> you have stump the band. let's crowd source is there to be one of like to try to respond the johnson's question more fully and what address -- gentleman's question -- to info at all health care.org. will try to post that on our website.

yes? >> rick curtis, institute for health policy solutions. primarily for peter, by but kevin, i'm sure you'll want to chime in nationally speedy that microphone doesn't be seen to be working very well. swallow it if you would spend okay. can you here me now? no, i think probably everybody in the audience read the press account in the initial year in california where there was such dramatic change in the cost competitiveness of a nongroup market largely because of the exchange, and the real problems, you know better than anybody in the country with a directories

might be interesting to folks to understand how you went about working with folks to get as far as you've gotten and we think you need to get. kevin, you may have some national perspectives on exactly those issues. >> thank you very much. covered california mission statement is we are about enabling consumers to make the right choice of health plans and providers. the individual, the institutions individual, the institutions is right for when we opened our doors in 2014 we had a combined provider directory that took all the directors of all health plans and put in one place or you could say doctor ramirez which health plan does he contract with? we took down because the underlying data was so bad. it was particularly bad from two of our largest health plans that have gone through major changes in the networks. our regulator and in california there are two, 95% of individual market is regulated by the

department of managed health care, did audits and found their directories wanting, significant we found the directories wanting and we work directly with those plans to send what we you going to do now to reach out? to every doctor they thought that contracted they did it. we did it jointly. we did joint letters from covered california and the health plan to but also in california did joint mailings with their medical societies. last year we did many from covered california and the california medical association the association of family physicians, jointly signed by myself and the president of those associations saying it's your job to make sure you know which network you are in. it's your job to be part of solution. i want to be clear. we heard earlier provider directories have been bad for a long time. when it makes a difference

though is when people are changing plans to people that went into new plans that had a new network didn't have problems. it was repeat worked previously in these plans that were changing they had concern. i'm optimistic the directory will be a lot better but there they're still, this would be a work in progress. we are still doing audits and reviews of our plan, but this visit core element of consumer choice to make sure if you're taking a plant because of a doctor, that information is accurate. the other thing we did, if the information was inaccurate we let them change plans after ultimately. that's the thing and exchange content as an active consumer advocate more than just a purchaser to make sure the system works for consumers. those are some of the things we did. >> cabin, before you respond this will give you more to respond to come with question that came in one of the cards asking about whether there is

anything, and i would ask peter if there's anything in your reforms either to the directory or otherwise, that would give consumers information about the quality and ask about the price but maybe your rules preclude that problem, other providers who are listed in the directory. >> great question. first, california is one of the states that dissent network adequacy regulation for quite a while. one of the national leaders of having adequacy standard the question is a great wonder not just adequacy. you don't have an existing relationship with a doctor, it's a good doctor. they are not in regulation standards but a turn your attention to our attachment seven of our contractor if you pulled on the website, you can link to that attachment. we asked everyone over health plans what are they doing to give tools to consumers to make treatment choices, to make doctor choices, hospital choices, that is informed by what it will cost in out of pocket and deformed by the quality of that provider? this is right now and evolving everyarea but it's one of the

things we're pushing everyone over health care plans under that choices ones -- that choices one you make one chip into plan. the way we deal with that in california is again active purchasing. it's our expectation our health plan help people make the right doctor and treatment choices well informed in terms of quality and cost. >> just as a quick follow-up. i don't know if any state based market-based that didn't struggle with provider directories. it's not just provider directories. it's also formularies and that's another important piece for folks not undergoing care, how to make sure that plan they're going into and understand that responsible is a what drugs are covered. maryland, d.c., they moved and with integrated provider directory systems that i think have been successful so far. and other states have followed suit. on the formulary side, last year

we did kind of a sampling of the state based marketplaces. it was still very difficult during open enrollment to find the links for the formularies actually pull up the formularies in many of the state's marketplaces. >> peter? >> i think it's right, when you we look at consumers choosing plans, about 30% care about finding a doctor. 10 or 50% care about drug. these are chronically ill individual. the vast majority don't but for those who do they care a lot about. covered california people can link to each plan's formulary. we look forward to having a consolidated formulary directory. it's not going to be in 2016 want to do things i've learned is i.t. as not as fast and nimble as we all would've thought the we look at building a system such that someone considers the drug i

have. which plans have got that so they can see that as well as seeing what the doctors are that a consumer response workplace i think a lot of exchanges will begin as well as the federal government. >> i should add that i guess it's the letters, the guidance now requires that information on formularies and networks be provided by issuers in machine readable form and i think we'll see a lot of innovation in the private sector where companies merge some of the information with information on quality that might be available elsewhere. so i think it's not just the government that's going to be providing solutions but the private sector as well. >> okay. i think our time would dictate that you are about to ask the last question. >> okay. my name is carolyn. i work for -- my question is about trends in changes to premiums. this year like last year we saw some large jumps

from major insurers that sometimes more than 10 sometimes more than 20%. my question is when it ever can we expect premiums to level off and not see level off and see if you're over here jumps of that size? >> i think we haven't seen anything yet about final rates for this year. so the rates have been posted are those over 10% am not yet subject to having been reviewed by state regulators. in the majorca states the state regulators, the taliban from naic can speak to this better, have the authority to reject rates and ask them to be lowered. the preliminary numbers are not in any one city. take to the bank or take against

this new. number two, again california last year had an average rate increase the 4.2%. i think we're going to have state income and enjoy our rates will be public and and been subject to a 60 day review by our regulators. but what we are saying when we see these jumps, it is plans doing that pricing to i think this is an issue of either regulators missing the boat the prior year our exchange is not doing acted in a purchasing. you are not seeing that in california. and the price jump of 25% means that a plant underpriced dramatically the prior year. it's not about the risk pool. it's about plan to blow and after i want to be clear that across the nation the enrollment was strong, good involvement with a good risk mix across the entire nation. so look at i think it is a dangerous to say here's an example for 15 to 20%. clearly it is a bad risk pool. it's not. it's about underwriting and bad plans screwing up. look at the overall national averages for rate can look at the overall rates we are seeing. i think what we are seeing in

terms of the three r's, reinsurance which is on the report that came out a few days ago, a lot of money went to health plans that was why the rates were so low in 2014. 2015 they are calculating what they will get paid for reinsurance, and 2016 is when we sit down and negotiate with plans. we look at the same trend, everything. when we kick the tires we did have one plan in 2015 that have big spikes. and stay tuned for later. it's so easy to grab a few numbers as if those are really meaningful. they are not. look at overall averages, that's what i'll risk pool story tells. the issue for consumers and so if you're in a plan with a big rate job, it's a matter of making sure that plan or that exchange gives consumers information that got the cheaper often -- the cheaper option.

many exchanges to pasadena which is if you don't do anything we will keep you in the plan you are in. that make sense if your estate whose rates didn't bounce around but if you're in a state where last year you were the lowest silver and next year your plan is 20% higher, you could save a lot of money by changing. i think the issue that i think about variation and rate increase isn't about an indicator of the risk pool. it's an indicator of exchanges meeting to give consumers information to make a better choice in the next open enrollment period. >> i would just say some of it is bad choices or bad assumptions. some of it we're still in a transition period, transition plans. we have grandfathered plans. we have changes in risk programs in the middle of the. we saw the reinsurance amounts going down about to be phased out. we just now got risk adjustment

numbers, just now got reinsurance numbers. that carriers after are doing their best trying to figure out what's ahead and they got what all of doctors are, but we are still not there yet and that's one of the reasons we are saying some spikes. i would always caution on percentages, percentages as a statistician teacher always told me his life to you to look at them carefully after its percentage but a percentage of what. what we are looking now they got where the dollar amount is not the percentage increase or decrease but what premium will be charged versus everybody else in the market and where is everybody coming to. i think we will see some settling down now we are getting closer to where everybody is in the pool, all the rules are set, still have this small group change coming, we think, maybe maybe not. we come everybody is feeling that way so we are us sing some of them but we feel like it will

settle down in the future. >> and we always have to remember that even before the affordable care act we have large jumps in premiums and premiums all over the place so this isn't new. but i would agree with brian that we are going to a transition phase and probably three, four years out we will know also about where we are endless of course we decide to do something. >> i would just follow up on something that peter said about consumers making choices and changing plans. it was remarkable number of people change plans last year, about 30% change plans which is a lot higher than you see in employer-based plans, medicare program. people really are exercising their choice prerogative on plans. >> okay. well, thank you all for active participation in this come and

for showing up in the middle of a week like this. i want to thank the commonwealth fund, especially sara and our colleagues for helping to shape and make good this particular program. also thank you for filling out the blue evaluation form that you were scribbling on right now. and i want to ask you to help me thank the panel for addressing most of the questions anyway. [applause] and my apologies to those of you took the time to write questions on cards that we couldn't get to in the time that we had to i don't think we are done with this project yet and the subject may be showing up in your schedule soon. thank you.

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>> hello everybody. we are going to get started. obviously debate was a term that provides a great deal of interest to a lot of people. nice to see such a great turnout for our event today. i would like to welcome you to the american constitution society's annual supreme court preview. i'm carol yine. as many of you may know and hopefully all of you already

know, acs was founded in 2001 and is a national network of lawyers, law students, judges, and policy makers who believe that the law should be enforced to improve the lives of all people. acs works for positive change by shaping the debates on violetly important legal and constitutional issues such as the ones we will discuss today. so it seems that every june i stand up here and i remark on the block buster quality of the supreme court term that has just ended. this year is of course no exception. from the challenge to the affordable care act to the continued viability of the disparate impact standard in discrimination suits to marriage equality, more could not have been at stake for millions of americans. and as we head into the 2016 presidential elections, no one needs reminding about the

importance of the courts and who is nominated to sit on them. so to get us started in the examination of the october 2014 term let me introduce our moderator. someone who is no doubt already extremely well known in this room. tom goldstein is the an appellate advocate. he is known as one of the nation's most experience supreme court practitioners he has served as counsel to the petition or respondent in roughly 10% of the court's marriage cases for the past 15 years personally arguing 35. in addition to practicing law, tom has taught supreme court litigation at harvard law school since 2004 and previously taught the same subject at stanford for nearly a decade. tom is also the cofounder and cofounder of scot tuss blog which is still the only web

blog to receive the peabody award. in 2010, the national law journal named him one of 40 most influential lawyers of the decade and legal times named him one of the 90 greatest washington lawyers of the last 30 years and praised him for transforming the practice of law before the supreme court. so who could be better than tom to navigate this term for us. so please join me in welcoming tom goldstein. [applause] >> so thank you all so much on behalf of the panelists i really do appreciate that you all have taken the time to come and be with us to talk about the supreme court term that just concluded. it is an extraordinary thing. we've been doing this for roughly o 10 years or so and this is the first time that it will be more fun than the

federal society wrapup. it was an incredible term. i have learned a great deal about it. i have learned that i am now required to get same sex married. that both my partner and i will receive subsidized health care and everything else. which we will need because the court has now required industries to put more mercury into the air. so to fill in the details of that we do have an extraordinary group of people, subject matter experts, folks who know a ton about the supreme court. i'm personally very, very excited to hear what they have to say. we have one particular approach. we think you are a self-selected group of people who know what's going on at the supreme court. particularly with respect to the biggest cases. we are not here to tell you what happened. we're here to analyze, what's going to happen in the future so that you can have a broader and deeper appreciation what it is the court has done and ucks expect to see in the coming

years. there are two dominant cases but lots of important ones. and so let's start with same sex marriage. and we could not be more fortunate to have someone than bill who is a professor at yale but more than that is perhaps the nation's foremost scholar and authority on questions related to gender and sexual minorities. and can you talk to us about the same sex marriage ruling? >> let me get started with justice kendkwli for the majority makes a choice. it's very striking the majority decision rests upon fundamental rights of marriage and not on the denial of equal protection that kenledy's earlier decisions relies on. so it goes to the grizzwoled and specifically the lawrence versus texas mode of analysis. now, why do i think justice kennedy did this and what are some of the consequences? well to begin with i read in

the wedding of anthony kennedy's personal enthusiasm for a libertarian philosophy. the european focus on dignity, a word that occurs in this opinion and elsewhere, and apparently his very deep admiration for marriage, which is described in the opinion as transcend nt, sacred, the foundation of family, society government without which -- i'm quoting -- there would be neither civilization nor progress while -- signature mundfroid -- justice kennedy further said marriage is a unique form of commitment "responding to the universal fear that a lonely person might call out only to find no one there. " words that i'm sure still haunt the three women in the majority. none of whom are married. now, as justice thomas points

out in his dissent, liberty has traditionally been understood as freedom from government interference. and thomas points out that even the case on loving the anti-adjacent case had that feature government oppression. kennedy is using liberty apparently in a much broader sense certainly as the original framers as thomas points out but in a sense of the freedom to construct life choices within a government framework similar to everybody else. and that's where kennedy brings in equality as part of the calculus. the first time. the second thing. here is another advantage of justice kennedy from his point of view choice of fundamental rights. you go with heightened scrutiny

-- this is some kind of heightened scrutiny though not very well specified. it enables the majority to avoid any discussion of animus. a word that was prominent in romer and evans and mentioned also to some extent in windsor. kennedy goes out of his way to be respectful of adherence to traditional marriage. and he recognizes i think implicitly but clearly that the traditional marriage folk are frightened to death that they're going to be associated with bigotry and their grandchildren will see them as the george wallaces of their generation. now, this doesn't satisfy the dissenters, justice alito in particular, worry they will be villified. i don't think it's so much because of justice kennedy's reason. justice thomas correctly points out that the government doesn't

confer dignity. i think the government does not do a very good job of confering villification. there's a third i think i think he went with fundamental rights. equal protection clause analysis might have brought sexual orientation out of the closet as a quasi or suspect classification. either explicitly or by implication. and kennedy i think wants to keep the court's options open to respect religious and traditional marriage libertarian rights to exclude or to discriminate. remember justice kennedy was the fifth vote in lobby lobby and years ago in the boy scouts case and justice kennedy i think is loathe to close options. this is an implicit deal if justice kennedy is going to deliver the fifth vote then you sort of go with the bride who

brought you. there are some disadvantages highlighted by the near histterkle dissenting opinions in this case. so for example due process which much of this sounds like and fundamental rights is much more controversial because unlike the equal protection clause it's not clearly rooted in the constitution's text. marriage is never mentioned. or even original meaning. there's a lot of rich original meaning that would support the same rulings here. the four dissenters go to town. chief justice roberts raises and celebrates the ghost of walk anywhere judicial push is the way scleelia decides this. this is what the majority is engaged in. but i must say in defense of kennedy he does say if you take the right to marry seriously they are part of the rule of law in america.

and you apply them. it's very hard to deny lesbian and gay people. 25 years ago i relied mainly on turner which relied on the majority opinion where missouri allowed procreating prison inmates to marry but not other inmates. the court unanimously struck that down. it seems to me based upon the idea of committed relationship as the basis and the benefits of marriage. and i've always thought since 1987 how can a civilized society give convicted murderers and rapists a fundamental right to marry but not give it to committed lesbian couples raising children? a second problem is that the famous redefinition argument has more bite against the fundamental right to marry than say against equal protection clause analysis.

this is the big argument. he said erroneously marriage has always been different sex. that is simply false. it is not disputed but it is untrue. but then he makes the better point that fundamental rightings marriage has always assumed different sex. true. and then the chief says for us the supreme court under the aegis of fundamental rights to redefine marriage in this way is a really big move and not something the court often does. chief justice says, just who do we think we are? now, i think the right answer to the redefinition argument is that michigan, hoy, eat al, have already redefined marriage in their positive laws away from the imperative of procreation and towards committed relationships and a structure for those to

flourish. and everybody gets this in the state of michigan and ohio except lesbian and gay couples raising children. and so it seems to me that is the answer to the redefinition question. though not a path justice kennedy followed. third problem. the leading case is arguably glutchberg the 97 right to assisted suicide or aid in dying assistance. rehnquist's opinion which kennedy joined in full defines the fundamental right analysis very narrowly and very historicically. the kennedy opinion interestingly associates glutchberg which he joined with bowers and jetsens the specific historicle approach by using the marriage precedent in a very effective way. this particularly drives the dissenters crazy. they argue the dissent the justices can set the level of

generality anywhere, then they are free to expand fundamental rights juris prudence. what are the limits? is this not anti-democratic? to which kennedy's response is kind of democratic deliberation has been exhausted in this case. it was just beginning in glutchberg in the aid in dying issue. and you can just see the arguments that are now used. the irresponsible procreation argument is an argument to exclude lesbian and gay couples. so the way kennedy sees this is his opinion is just a cleanup operation. it's not going to work very well in mississippi, arkansas, and some of the other states that were still outstanding and there are it is a similar number of states to clean it up. moving forward. what do i see moving forward? i see a lot of things until i get yanked timewise.

so one thing. i do think the big take home point is how broadly are we going to understand the liberty juris prudence under the due process clause? and i would read the joirs similar to the way i would read lawrence and casey which i think is unmentioned in this case. and that is the government exists -- this is a post hobbsian understanding of government. government exists to create a structure for americans to make life choices which allows them to flourish. this is libertarian. at least the way kennedy and eescridge understands it. and then this is where kennedy ties in the equal protection idea. that structure cannot be arbitrarily denied minorities. and here, importantly, he would include religious minorities as well as sexual and gender

minorities. can this be relevant? and this is a question. to the ay choice issues that are going to be confronting the court such as state law that is have sought to and successfully closed down abortion clinics? cannot this regulatory understanding of liberty also apply in those cases as well as in immigration cases as we saw 30 years ago 35 in tyler and doe can where children of undocumented ipcomb grants were excluded from the texas school system. second point forward. what about the rights of religious and traditional marriage persons? anthony kennedy as i said voted to protect these rights in some constitutional cases such as the boy scouts case and the free exercise in title 67 case. i would emphasize, however, that moving forward for

religious minorities and traditional marriage people that protections are probably more often going to be statutory. and not unimportantly title 7 as well provides protection possibly for marriage license. quoting justice kennedy, language that will influence later cases,. the first amendment ensures that religious organizations and persons are given proper protection as they seek to teach the principle that is are so fulfilling and so central to their lives and faiths. and to their own deep aspirations to continue the family structure that they have long revered. so all i had add to that is in the wake of more gay marriages religion, as i've been saying for decades, has already changed and will continue to change. and mainly not because of

government action. it won't be mainly, it will be because of young people and shifting cultural morees. but keep that in mind. religion moving from hostility to lesbian and gay marriage or don't ask don't tell, as many churches have done. finally i can't say tht a bad day for hard right conservatives. roberts and scalia in their dissent i don't think consciously, the dissent reads exactly like the harvard law school's attack on brown versus board of education in the 50's. and then throw in herbert wesmler, who taught at columbia. that if you substituted brown for obergfeld, you could simply lift a lot of the chief justice's rhetoric including

his reliance on oliver wendell holmes who was the true critic of whack anywhere. but he was also the author of the notorious sterlization decision where he not only upheld a denial of liberty but then added insult to injury three i am we sills to none. one of the most famouses opinions almost match particularly footnote 22 where he wants to hang his head in a bag and he ridicules the majority opinion as engaged in mystical aperition. ism of a fortune cookie. i will conclude with what's the future for the lgbt rights movement? i think we're going to see the lgbt rights movement move from courts to legislator

legislatures and operatives officials from judges to administers. we've already seen that to a significant effect. the focus is not to be anti-discrimination laws, educational programs, health care needs, and a structuring mechanism not just marriage for family choices. now, one not so good lining for the decision is that moving forward there will be overwhelming pressure for good and bad reasons ant discrimination laws to include conscience allowses probably broader today than would have been self-appropriate three years ago. thank you. [applause] >> fantastic. the second really kind of major case from the end of the term is of course the subsidies challenge to the affordable care act. to talk about that we have jeff

law. jeff is the co-head of the practice at crom well an incredibly prominent international law firm. he previously served in the solicitor general office. argued ten cases himself involved in literally hundreds of others. can you talk about that case? >> thanks to the acs for hosting me. it's always nice to be the bearer of glad tidings. i think in this crowd it's good news that the court sided with the administration in king v. bur well. and i think when you say it's a major case it stood to be if the court had gone the other way. be the bearer but i think having affirmed the administration's position probably took a lot of the air out of the debate over the case. but there are a handful of things that i think the opinion might matter for going forward. so i will talk briefly about those and then a little bit about the other pending challenges to the affordable care act and what this might mean for those cases. i think the one really dock

trinely significant thing in the opinion is that the court starts by saying the chief justice says this is just too important to apply chevron. in the congress -- remember this is an i.r.s. rule that was at issue. so you would normally think that it would get chevron treatment at least that analysis. however you resolved it under the two-step chevron structure. and the chief justice said look if congress had wanted the i.r.s. to decide this surely it would have said so. i think that's a sort of important clarification. in other cases where the court had invoked this too important for chevron principle cases like brown and williamsen over tobacco or mci or the utility air case last term, it had alms seemed like it was part of the chevron step one analysis, it was part of what the court was using to find that a statute was not ambiguous and hence there was no gap for an agency to fill. and here, that's not what the court says. before it even gets to the

two-step analysis and looks at whether the statute is ambiguous, it just says this is too important to even do the normal chevron analysis. now, i don't know how much there is to recommend that approach. i'm not sure what it is that makes a policy question so significant that it shouldn't get the normal chevron treatment. i think this case certainly qualifies. it's just not clear what else comes underneath the umbrella. and i'm not sure why the court is so sure that congress sure that congress wouldn't have wanted the i.r.s. to decide it. we know now that the mandate imposes a tax. this case is about tax credits for individuals on a federal subsidy. and if the administration was right on the merits that congress would never have contemplated that these individuals on federal exchanges could not get the tax credit under the act, then you would have thought that there wouldn't be that much

controversy over the i.r.s. saying so in the face of any ambiguity on that score. so i have some doubts about whether this too important for chevron doctrine is capable of principles application going forward. i also am not as sure as some folks that it will matter all that much. by and large the court is invoking it in cases where most of us are probably more comfortable with the justices making these decisions than agency administers. certainly i think that's probably been the intuition in this case. i also think -- and bill can correct me if i'm wrong -- that having upheld the affordable care act there will not be an outcry whether the court was being faithful in chevron. i think at the end of the day the only thing i will say is that some folks have allauded chief justice's opinion as one of judicial modesty. i'm less sure about that.

because whatever you think about the notion that some questions are just so important that they have to be decided by we the justices, i don't think that's a conception of the judicial role that could be fairly described as modest. i think the folks that are -- i think when folks laud this opinion as one of judicial modesty, i think what they're really saying is that on the merits they agree with the court's statutory analysis and they think that the court should not have disrupted the current way that the affordable care act functions. i don't think it's really a claim about the role of judges. on the merits, i think -- my own view is that there was a disconnect between the case and a lot of the common tri over the case. i think there were a lot of people who said and wrote that this was an easy case. i'll be curious to see what the other panelists think. my own view is that it was a it was

a harder case than people give it credit for. i think if you believe in tax or purpose, come hell or high water, it's an easier case. but for the moderate justices, they are reluctant to ignore text in order to look at larger claims of purpose just as they are reluctant to read words in ways that they think would accomplish ends that congress did not intend in the statute itself. and i think bill and others made some very clever and good arguments about why this was not a case about text versus purpose. it was a case about good textualism and bad textualism and all the rest. but i do think that bubbling up for the chief justice and kennedy, there did seem to be a real pull between what the statute seemed to say on its face and what we all seem to believe that congress was intending not withstanding what

may have been some inartful drafting in the provision. as you know, the majority said look if exchange established by the state means just that, only state exchanges and not the federal exchange, both in the provision directly at issue in the case and in other related provisions of the affordable care act, it would really it seems put the statute at odds with itself because none of the individuals on the federal exchange would qualify for subsidies. but the act clearly contemplates in a number of provisions that individuals on all of the exchanges -- whether state or federal -- are eligible individuals and can get the tax subsidies. and that's enough, the majority says, to make it ambiguous. and then it turns to resolving that ambiguity. it says by looking at the structure of the act. i think when you boil down what

the court says is context and structure, i think it amounts to a set of arguments that are really about purpose and consequences. as the chief justice says in its opinion this was passed to improve health insurance markets, not destroy them. and i think it really turned on the fact that the chief justice and justice kennedy and the more liberal members of the court did not think that the challengers to the act had a very compelling story to tell about why exchanges established by the state would mean only state exchanges. you can tell a story about why they would have wanted to induce states to create their own exchanges. but there certainly was not ample evidence of that in the legislative record of the act. and though the court didn't say it, it almost felt like a dog that didn't bark case. if that were really the way that the act had been structured and what they were attempting to accomplish, you got the feeling you would have seen more evidence of it than some after-the-fact comments by

folks who played some role in the legislation. so i think at the end of the day it really did turn more on a story about purpose than it did about some of these arguments. and i think the administration had a more compelling story to tell about why its interpretation must have been the one that congress had intended. and you get flavors of that in the chief justice's opinion when he says, look, there's a lot of inartful drafting throughout this statute. now, the dissent says look, we change all the rules again and again in order to uphold the affordable care act. and is that a fair criticism? i think in part it is and in part it isn't. i'm not sure that it is -- i'm not sure the dissent is right to say that the court had to strain to create ambiguity here any more than it does in a range of cases that get far

less attention. is it more of a strain to find ambiguity here than it is to say as the court did in yates that a fish is not a tangible object that can be destroyed or consealed? i'm skeptical. i always thought fish were tangible objects. so other than the intensity of the spotlight i'm not sure that the court had to work a lot harder here to find ambiguity than in any number of cases where it resolves hard statutory questions. i do think it is fair to say that whether or not the chief justice or justice kennedy thought it was ambiguous they did seem to think it is a drafting area. i do think it's fair the court has been much less hospitable to that argument. we've all gotten questions about i'm not worried about how it came out if it is a mistake

because congress can fix it. that arguments has a lot more way than here because in most context it's a pretty benign fiction. here it would have seemed ridiculous because everyone knows that thebecause everyone knows that the last thing congress would have done is amended this provision to add established by the state or the secretary in lieu of the state. i suspect that they felt not being able to write that opinion, they really had to put it on ambiguity and resolve that ambiguity by purpose. what does it mean going forward? i think the act is here to stay. there will be some legislative tension for very -- various things. there are still pending judicial challenges, there's the origination clause challenge, i think there's legislation pending. i don't see anything here that would increase the chances of en banc or search. i think there