The Affordable Care Act is back in the headlines. House Democrats last week made moves to shore up the ACA in the wake of the Department of Justice’s sudden reversal in policy, now saying it agrees with a district court decision to overturn the entire health care reform law. RISE looks at the latest developments and what they mean for the future of health care reform.
Justice Department does a 180, switches position on validity of the ACA
The DOJ kicked off the latest news cycle in a legal filing, stating that it wouldn’t defend any part of the law in court and it agrees with a district court judge’s ruling in December that the entire law is unconstitutional because of the passage of a Congressional tax bill, which eliminated the financial penalty for not having health insurance.
Up until last Monday, the DOJ had maintained that most of the legislation should remain intact. News of the abrupt shift in policy drew criticism within the health care industry and from lawmakers on both sides of the aisle, as a full repeal of the nine-year-old law without any replacement would create complete chaos for the entire health care system.
Indeed, millions of Americans would lose health insurance if the law was eliminated, removing popular provisions, such as protections for Americans with pre-existing conditions and allowing children to stay on their parents’ health insurance plans until they turn 26. But the potential impact of a full repeal is even more far-reaching because the law is now interwoven into the entire health care system. For example, it would also put an end to Medicaid expansion as well as the development and testing of innovative health care payment and service delivery models via the Centers for Medicare and Medicaid Innovation. The ACA also established the Medicare Stars program, accountable care organizations, and the Medicare Shared Savings Program, as well as a phase-down of the excessive payment levels to Medicare Advantage plans over a six-year period. In addition, it created a pathway for the Food and Drug Administration to approve generic versions of biologic drugs.
“This lawsuit is as dangerous as it is reckless,” said California Attorney General Xavier Becerra, who is leading a coalition of 21 attorneys general to defend the ACA, and filed an opening brief last Monday in Texas v. U.S. “It threatens the health care of tens of millions of Americans across the country – from California to Kentucky and all the way to Maine,” said Becerra. “The Affordable Care Act is an integral part of our health care system. For the last nine years, it has ensured that seniors, young adults, women, children and working families have access to high-quality affordable care. It has prevented insurance companies from discriminating against 133 million Americans with pre-existing conditions. Because no American should fear losing healthcare, we will defend the ACA every step of the way.”
For now, the ACA remains the law of the land while the case is under appeal, but many expect the case will end up before the Supreme Court and will become part of a larger debate during the 2020 elections.
House Democrats introduce legislation to strengthen, expand ACA provisions
A day after the DOJ’s surprise declaration, House Democratic leaders introduced a bill that expands the ACA’s premium tax credits, increases subsidies for low-income people who already qualify for aid, extends eligibility of ACA subsidies to those in higher income brackets, funds state-based reinsurance programs, and provides funding for navigators to assist consumers in signing up for health care. But it doesn’t restore cost-sharing payments to health insurance that the Trump Administration had ended.
The legislation, introduced by Energy and Commerce Chairman Frank Pallone, Jr. (D-NJ), Ways and Means Chairman Richard Neal (D-MA), and Education and Labor Chairman Bobby Scott (D-VA), aims to reverse actions taken by the Trump administration to “sabotage” the ACA.
“The ACA’s impact is undeniable–an end to discrimination against people with pre-existing conditions, the removal of barriers to preventative services, and 20 million more Americans with insurance. Today’s bill builds on this progress, and helps even more Americans enroll in quality, affordable coverage,” said Neal in an announcement about the legislation.
Judge strikes down Trump administration’s plan to expand association health plans
A federal judge, meanwhile, has blocked plans by the White House to expand access to association health plans (AHPs), which allow associations to market low-quality health care plans that avoid the protections under the ACA.
The U.S. Department of Labor allowed small businesses, including self-employed workers, to form associations to obtain health coverage as if they were a single large employer. The plans were cheaper but also skirted ACA requirements for the minimum benefits coverage provisions. Industry stakeholders also noted that these skimpy plans attracted healthy people away from the ACA marketplace, effectively driving up premiums because insurers’ risk pools now included a larger share of sick members.
U.S. District Judge John Bates ruled that the Trump administration’s Final Rule was “clearly an end-run around the ACA. Indeed, as the President directed, and the Secretary of Labor confirmed, the Final Rule was designed to expand access to AHPs in order to avoid the most stringent requirements of the ACA.”
The federal government will likely appeal the decision but in the meantime AssociationHealthPlans.com said in a statement that the ruling was disappointing because thousands have already enrolled in AHPs and it has created an “unnecessary detour on small businesses’ path toward more affordable health coverage.”
CMS report reveals slight decline in open enrollment numbers for 2019
Meanwhile, a report issued by CMS finds that enrollment in health insurance exchange plans in all 50 states and the District of Columbia remained steady at 11.4 million. But that figure represents a decline of approximately 300,000 plan selections from the same time last year.
In the announcement about the final report, CMS also said it would continue to allow insurers to offer certain “grandmothered” plans, which don’t meet all the mandates of the ACA. These plans provide consumers with more affordable coverage than they would have access to through ACA-compliant plans, according to the release.