Trump Administration Argues that Key Parts of ACA Should be Invalidated
June 08, 2018
Yesterday, the Trump Administration sided with Texas and a coalition of 19 other Republican-led states that filed a lawsuit in federal court challenging the constitutionality of the Affordable Care Act (ACA).
In its lawsuit, the states argue that the decision of Congress to eliminate the penalty for the individual mandate, beginning during 2019, have rendered the individual mandate unconstitutional and, as a result, the consumer insurance protections under the law are also invalid. These consumer protections include guaranteed issue, which requires insurers to offer coverage to everyone regardless of their medical history, as well as community rating, which prohibits insurers to set premiums based on a person's health history. These two provisions are among the most popular provisions of the ACA. Although the Texas-led lawsuit contends the entire law should be invalidated, in its filing, the Justice Department said that other provisions of the law, such as provisions to allow states to expand Medicaid coverage, should not be struck down.
Legal experts have commented that the decision of the Trump Administration to support Texas and the state coalition reverses a long-standing policy of the Justice Department to defend congressional statutes if reasonable arguments can be made in their defense.
While the final outcome is uncertain, the Administration’s position raises the possibility that major parts of the law could be struck down by court action, despite the failure of the Congress to repeal the law through legislative action.
Additionally, the Administration continues to pursue a variety of administrative actions, including the issuance of proposed regulations that seek to alter or impact the ACA. As an example, the Administration has put forth regulations that seek to expand use of Associated Health Plans (AHP) and Short-Term Limited Duration Insurance (STLDI) policies. The Administration and Members of Congress have contended these products will increase competition and bring down costs for consumers by providing access to alternative insurance options to the comprehensive coverage offered under ACA requirements. Many coverage advocates have raised concerns that healthier consumers will take advantage of less-costly, less-generous coverage, leaving the sicker and higher cost patients to secure coverage through ACA plans; ultimately, undermining the ACA insurance marketplaces.
A recent announcement by Pennsylvania’s Insurance Commissioner Jessica Altman indicates that Pennsylvania’s efforts to increase competition and stabilize the health insurance market have been effective:
- Pennsylvania health insurers are requesting an aggregate statewide increase of 4.9 percent for 2019 health insurance plans
- Consumers in nearly half of Pennsylvania counties (31) will have more health insurers offering coverage and, as a result, more choices
- The number of counties with only one insurer offering coverage will decrease 60 percent, from 20 this year to eight during 2019
- Insurers currently selling in the small group market plans requested an aggregate statewide increase of 3 percent for 2019
HAP and Pennsylvania hospitals embrace the importance of expanding access to meaningful coverage. The ACA has been instrumental in supporting more than 1.1 million Pennsylvanians through health insurance coverage, providing better access to health care services and dramatically reducing the uninsured population in Pennsylvania. HAP will continue to advocate for policy that advances those outcomes.
If you have any questions relating to this issue, and the impact of coverage, please contact Jeff Bechtel, HAP’s senior vice president, health economics and policy, and questions regarding HAP’s federal advocacy efforts should be directed to Laura Stevens Kent, HAP’s vice president, federal advocacy.