Forecasting the future of the ACA


November 13, 2020 – On November 10, the Supreme Court heard oral arguments in California v. Texas, a case challenging the constitutionality of the Affordable Care Act (ACA). Benjamin Sommers, Huntley Quelch Professor of Health Care Economics, discusses implications for health care in the U.S. from both the court case and the Biden presidency.

Q: As the Supreme Court considers whether or not to strike down the ACA, what are your thoughts on the ramifications of potentially losing this law?

A: If the ACA were struck down completely by the Court, without immediate action by Congress, more than 20 million Americans would lose their health insurance. The marketplaces and Medicaid expansion would go away, along with billions of dollars in federal funding, and the law’s protections for pre-existing conditions would be removed. That’s the headline. And during a pandemic, it’s hard to imagine a worse public health decision.

But beyond that, a decade after its passage, the ACA is thoroughly embedded in the U.S. health care system in numerous important but less obvious ways, affecting issues ranging from how Medicare plans get paid, support for the Indian Health Service, young adults staying on their parents’ plans until age 26, and what basic services have to be covered by health insurance plans. Eliminating the law would, without much exaggeration, be a recipe for chaos.

Q: President-elect Biden has said that he hopes to build on the ACA and reverse some of the Trump administration’s actions to undermine the law. If the challenge to the ACA fails, what strategies do you see the new administration pursuing?

A: If the Republicans maintain control of the Senate, which looks like it will come down to two runoff elections in Georgia in January, there likely won’t be much—if any—legislative action on the ACA. But there is still a lot the administration can do to bolster the ACA, primarily through reversing the executive orders and non-legislative changes the Trump administration made. For instance, I’d expect to see the Biden administration lengthen the enrollment period for people to apply for coverage, spend much more money and energy on outreach to help get people enrolled, work to encourage the remaining non-expansion states to expand Medicaid, and eliminate barriers to coverage like work requirements.

If the Democrats do manage to claim narrow control of the Senate, there will be a lot more on the table, including a possible public health insurance option on the ACA marketplace, increased generosity of premium subsidies, and legislation to improve the affordability of prescription drugs. But a 50-50 Senate with the Vice President breaking ties is still a tough environment for major policy initiatives, so I expect much of the movement to remain reliant on executive orders and oversight.

Q: If you could wave a magic wand, what would be your first step in improving the ACA as it stands now?

A: Without a doubt, it would be to expand Medicaid in the remaining 12 states that haven’t yet opted to do so. There are 2 to 3 million low-income adults in those states in the so-called “coverage gap.” These are people with a heavy burden of chronic conditions, who are disproportionately people of color, and who have no real way to afford health insurance under the current system due to the decisions made by their state leaders. Expanding Medicaid in those states—as the ACA drafters initially intended—would provide an immediate benefit in terms of public health, financial security, and health equity.

Karen Feldscher