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As the United States Supreme Court begins to consider Wednesday's arguments in a case that could implode the Affordable Care Act in 34 states, many in the insurance and health-care industries are bracing for a possible logistical and financial tsunami.

At issue in King v. Burwell is whether Obamacare subsidies for low-income Americans are聽limited only to "an exchange established by the state." If the Supreme Court rules that they are, it could invalidate the federal exchange established to serve the 34 states that chose not to build their own. That would instantly break the insurance plans' business model, experts say.

Those customers unable to afford health insurance without the subsidies would most likely drop out, insurers would then lose the premium revenue聽essential to pay their ongoing claims, and hospitals and health-care providers would have to provide many emergency services without a structure to compensate them.

鈥淪o what鈥檚 going to happen? It鈥檚 going to go berzerk,鈥� says David Oscar, the communications chair for the New Jersey Association of Health Underwriters and an insurance broker in Fairfield, N.J. 鈥淭he insurance carriers are going to have a conniption, and they're not going to be able afford the costs anymore.鈥�

Before each year, actuaries crunch their numbers to discern the risks of a given population pool, insurers then create their offerings of plans and prices based on the premium payments they expect to receive, and then state regulatory commissions recheck these numbers to make sure they comport with the law before approving them.

鈥淭he insurers have rates that they鈥檝e already agreed to for the calendar year, and they've already been through rate review, which is a months-long process,鈥� says Linda Blumberg, senior fellow at the Urban Institute鈥檚 Health Policy Center.

According to , a Supreme Court ruling that would eliminate the Obamacare subsidies would cause health-care spending to fall by at least 35 percent for about 8 million affected individuals in these states.聽

Hospitals could lose up to $6.2 billion in payments, physicians up to $2.1 billion, and drug companies $1.6 billion, the study found, noting that 鈥渦ncompensated care could increase to unsustainable levels."

Such cost pressures would force insurers to try to raise their rates 鈥渟mack dab in the middle of a plan year,鈥� says Blumberg, a practice that is currently outlawed.聽

Indeed, anticipating a ruling that would create such chaos in the industry, the American Academy of Actuaries, a professional association based in Washington, D.C., to allow insurers to revise their rates midstream, should the Supreme Court gut the law鈥檚 subsidy provisions.

And as reported by the live updates from oral arguments in the King v. Burwell case , Justice Anthony Kennedy聽on Wednesday morning brought up the fears many in the insurance and health industry have been sounding. Justice Kennedy "expressed deep concern with a system where the statute would potentially destroy the insurance system in states that chose not to establish their own exchanges 鈥� likening this to an unconstitutional form of federal coercion," wrote Eric Citron, live from the Supreme Court.聽

If the court rules against such federal subsidies, "premiums for 2015, which are already in place, and premiums for 2016, which need to be submitted prior to the court鈥檚 ruling, would likely be inadequate to cover claims,鈥� the Academy鈥檚 Health Practice Council wrote in a letter to US Health and Human Services Secretary Sylvia Burwell, the named defendant in the Supreme Court case.

But last week 聽that聽the administration knew of no legal actions it could take to 鈥渦ndo the massive damage to our health care system that would be caused by an adverse decision.鈥�

Even if insurance companies are allowed to raise their rates聽for 2016, however, health聽experts describe a 鈥渄eath spiral鈥� in which even those without subsidies would no longer be able to afford health insurance. found that unsubsidized premiums for all individual plans, both those offered within and those sold independently, would jump nearly 50 percent.聽

鈥淚t would be very messy, and not just for the exchanges,鈥� says Gary Claxton, vice president at the Kaiser Family Foundation and director of its Health Care Marketplace Project. 鈥淏ecause the way the law works, the whole non-group [individual] market for insurers is considered one risk pool, which means the business you write inside the exchanges and outside the exchanges are rated on the same basis. So it affects all of your business 鈥� basically you鈥檇 have to raise rates on everybody.鈥�

Responding to such concerns, this week some Republican senators that would provide temporary subsidies for those who would otherwise be forced to drop their coverage,聽and keep this year鈥檚 financial infrastructure in place, and possibly next year鈥檚 as well.

But insurance industry experts are not convinced that the current Congress will act. If the Supreme Court takes away the subsidies and Congress doesn't "adjust, fix, or amend this mess 鈥� and I think we know how likely that is," says Mr. Oscar, the health underwriter and insurance broker, "we鈥檙e up a creek without a paddle."