In early 2017, the Congressional Budget Office (CBO) released an analysis, How Repealing Portions of the Affordable Care Act Would Affect Health Insurance Coverage and Premiums that detailed the impact of an ACA repeal. The report suggested a dramatic impact on people if the law is repealed without a replacement—a real prospect if the Supreme Court agrees with the Texas Attorney General and the Administration on their request to strike down the law.

The CBO report, conducted by the nonpartisan office, was a response to a request by Senate Minority Leader Senator Charles Schumer (D-NY), Ranking HELP Committee member Senator Patty Murray (D-WA), and Ranking Finance Committee Member Senator Ron Wyden (D-OR). Senators requested it at the start of the Trump Administration’s efforts to repeal the law. Although the analysis is three years old, it still sheds light on what could happen. CBO was asked what would happen if the ACA were repealed and not replaced, and the report concluded:

  • The number of uninsured people would increase by 18 million in the first new plan year following the enactment of the bill. Later, after the elimination of the ACA’s expansion of Medicaid eligibility and of subsidies for insurance purchased through the ACA marketplaces, that number would increase to 27 million, and then to 32 million in 2026.
  • Premiums in the nongroup market (for individual policies purchased through the marketplaces or directly from insurers) would increase by 20 percent to 25 percent—relative to projections under current law—in the first new plan year following enactment. The increase would reach about 50 percent in the year following the elimination of the Medicaid expansion, and the marketplace subsidies and premiums would about double by 2026.

The CBO numbers were an update of information provided in the 2015-16 Congress based on legislation that Congress had adopted to repeal the ACA. That Congress was headed-up by Majority Leader Mitch McConnell and House Speaker Paul Ryan (R-WS) when they helped pass a reconciliation bill (President Obama vetoed the measure after Congress adopted it) that attempted to repeal the ACA. That bill left out repeal of certain insurance industry requirements because that repeal was not allowed under reconciliation rules. The Supreme Court is being asked to strike down the law in its entirety from insurance industry requirements, patient benefit requirements, and the various tax subsidies and Medicaid expansions.

The Supreme Court, with either 8 or 9 members, has scheduled oral arguments on the constitutionality of the Affordable Care Act for November 10, 2020. The case is the State of California, ET AL. v. the State of Texas, ET AL. In June, the Trump Administration urged the Court to side with Texas and told the Court, “the entire ACA must fall.”

Last year, as described in the Children’s Monitor, the U.S. Fifth Circuit of Appeals agreed with Judge Reed O’Connor of the Federal District Court in Fort Worth when he ruled that “the keystone” of the law was the individual mandate and, when Congress eliminated the individual mandate tax penalty, that it could not be severed from the entire ACA. That would mean that the whole law should be thrown out. Congress eliminated the tax as part of the December 2017 tax cut package. On December 18, 2019, the U.S. Fifth Circuit Court of Appeals in New Orleans agreed to strike down part of the Affordable Care Act provision, ruling that the requirement that people have health insurance was unconstitutional on a 2-1 decision and sent the case back to the lower Court in Texas for further analysis. As a result, the U.S. Supreme Court decided to take up the case in October.

The repeal of the ACA has been led by several Republican state attorneys general spearheaded by the Texas Attorney General Ken Paxton. That action has been countered by several Democratic attorneys general led by the California Attorney General Xavier Becerra. Based on the briefs, supporters of the ACA include AARP, the American Medical Association, and the Service Employees International Union, longtime supporters of the Act. Some of the other supporters of keeping the ACA in place include unusual parties. The Montana Attorney General Timothy Fox and Ohio Attorney General Dave Yost, both Republicans. A brief that was filed on behalf of economists who described themselves as “53 distinguished professors and internationally recognized scholars of economics and health policy and law…[from] the Johnson, Nixon, Ford, Carter, Bush, Clinton, Bush and Obama administrations.

In June, data from CMS indicated that 487,000 people obtained health care coverage after losing it due to the COVID-19 spread this early spring. The ACA allows for a special enrollment period (SEP) after job loss.

An analysis by the Kaiser Family Foundation released on Wednesday, May 13, 2020, showed that, because of the unemployment caused by the pandemic, “Among people who become uninsured after job loss, we estimate that nearly half (12.7 million) are eligible for Medicaid, and an additional 8.4 million are eligible for marketplace subsidies [ACA marketplace], as of May 2020.”

The Court has many options, they could strike down the entire law, they could strike it down in a period of time that would allow lawmakers under the next Congress and presidential term to pass a fix or a replacement, or they could narrowly deal with the mandate. They could also uphold the law, but the original ruling upholding the law in the summer of 2012 was a 5 to 4 ruling with Justice Ruth Bader Ginsberg, a part of the Chief Justice John Roberts majority opinion.

About the Author:

John Sciamanna is CWLA's Vice President of Public Policy.

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