Future of ACA in Focus as Administration Challenges Law and U.S. House Democrats Reaffirm Support
March 26, 2019
As the U.S. Department of Justice called for the 5th Circuit Court of Appeals to uphold a Texas District Court decision invalidating the Affordable Care Act (ACA), U.S. House Democrats are pursuing a legislative strategy to reinforce patient protections under the ACA and protect the ACA insurance markets from actions by the Trump Administration to undermine the law.
Late last year, Texas federal district court judge Reed O’Connor ruled in Texas v. United States that the entire ACA is unconstitutional because Congress zeroed out the penalty tied to the individual mandate, which provides that citizens must have health insurance. The ruling reasoned that the individual mandate is “essential” to the ACA and inseverable; and thus, the entire law is invalid.
The Trump Administration had previously adopted a narrower perspective in the legal proceedings, arguing that key parts, including consumer protections—but not all—of the law should be struck down. Under this new position, the Administration is challenging the constitutionality of the entire law, including expanded access to Medicaid coverage.
In one of the first acts of the 116th Congress, the U.S. House Democrat Majority voted to authorize intervention by the U.S. House of Representatives to defend the ACA in federal court. Efforts to protect and strengthen the ACA, and exercise oversight of the Trump Administration’s administration of the law, is a top priority for House Democrats.
The Administration continues to pursue a variety of administrative actions, including the issuance of regulations that seek to alter or weaken the ACA.
As an example, the Administration has issued regulations seeking 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.
House Democrats are now pursuing a signature legislative package that will take targeted steps to reinforce patient protections, including for individuals with pre-existing conditions, and stabilize the insurance markets. The Energy & Commerce Committee vetted policies during a March hearing seeking to strengthen the framework established by the ACA by reducing out-of-pocket costs for consumers, enhancing enrollment outreach efforts, and supporting state-based insurance marketplaces. The committee will be marking up a series of bills on Wednesday.
Of particular interest to Pennsylvania, H.R.1385, the State Allowance for a Variety of Exchanges (SAVE) Act, introduced by New Jersey Congressman Andy Kim and Pennsylvania Congressman Brian Fitzpatrick (R-PA01), would provide states with $200 million in federal funds to establish state-based marketplaces. Under current law, federal funds are no longer available for states to set up state-based marketplaces.
Pennsylvania currently is utilizing a federally-facilitated marketplace. New Jersey recently announced it will begin running a state-based exchange for 2021 coverage. Advantages to a state-based exchange include:
- More state control of all aspects of enrollment and reenrollment processes
- Greater flexibility to manage operational aspects of the marketplace based on Pennsylvania consumer needs
- Increased access to data
- Greater visibility to do targeted outreach and education efforts
HAP has actively supported efforts to promote enrollment and would support the Commonwealth in pursuing a state-based exchange which would allow the state to employ Pennsylvania-centered strategies to best serve Pennsylvania consumers and the unique needs of the state’s insurance markets.
According to the final enrollment report for 2019, issued this week by the Centers for Medicare & Medicaid Services, enrollment in plans through the ACA marketplaces during the 2019 open enrollment period dropped slightly from 11.8 million to 11.4 million.
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 policies that advance those outcomes.
If you have any questions relating to this issue, and the impact of coverage, please contact Jolene Calla, HAP’s vice president, health care finance & insurance. Questions regarding HAP’s federal advocacy efforts should be directed to Laura Stevens Kent, HAP’s vice president, federal legislative advocacy.