By Aaron Morrison, American Consumer Institute
Earlier this year, the Supreme Court decided that they will hear the most recent challenge to the Affordable Care Act (ACA). The challenge, now referred to as California v. Texas, calls on the Supreme Court to repeal the ACA. Yet, simply repealing the ACA through isn’t enough, it needs to be updated or replaced. While a record number of Americans support the ACA, it needs to be revised to restore consumer sovereignty that will give consumers the right to make their own choices, as well as protecting those with preexisting conditions.
However, in the short run, with the coronavirus outbreak, it is paramount for Americans to be enrolled in healthcare, albeit a private plan or the ACA. To that end, the Trump administration is considering the launch of a special enrollment period for Americans to sign up for health coverage under the ACA. In addition to that, nine state-run exchange markets have already stated that that “they will allow people to obtain coverage under the ACA even though the enrollment period has closed.”
On top of that, President Trump has advocated for a “temporary, emergency risk mitigation program” aimed at preventing a spike in health care premiums. With the COVID-19 pandemic continuously spreading, policymakers are on the hot seat to decide on how to mitigate the strain of the pandemic on the American healthcare system.
With the economy heading towards a recession, and with millions of Americans on the verge of losing their jobs and their health insurance, Congress should focus on what is already available to expand coverage and promote more efficient use of health resources.
Approximately 71 percent of Americans want the government to provide universal healthcare coverage largely in order to protect those with preexisting conditions. In addition, according to an American Consumer Institute study, 90 percent of Americans agree that they should be free to make their own choices about healthcare. Under the ACA, insurers are required by law to provide coverage for 10 essential health benefits and conditions. Insurers were convinced that a “flow of younger, healthier enrollees would offset the treatment cost of the older, sicker enrollees who signed up.” They did not.
As a result, the cost of participation increased to an unsustainable amount, leading insurance providers to withdraw from the ACA exchanges and causing premiums to rise while consumers’ ability to choose their own healthcare provider is almost entirely gone. The ACA made a universal healthcare system a reality while pushing consumer choice to the backseat.
When the ACA was first signed into law, consumers that opted out of the ACA were penalized with an annual ‘Shared Responsibility’ fine. In other words, those Americans that failed to secure the minimum essential coverage that the ACA requires faced a penalty tax at the end of the year. In January 2017, President Trump issued an executive order that removed the ‘Shared Responsibility’ fine, making the single alternative to ACA even cheaper. As a result, the lack of choice, as well as increased premiums, are causing “consumers to choose short-term health insurance policies that are much cheaper and do not satisfy ACA’s health insurance coverage mandates.”
The executive order may allow for a cheaper alternative to the ACA, but the alternative misses the mark. Consumers not only want choice, but they want a bang for their buck. The average consumer can either choose to enroll in the hard-to-understand ACA and pay high premiums for a broad policy or pay low premiums for a policy that can only be used in a catastrophe.
Rather than being forced to choose a cookie-cutter policy, the ACA should be revised to include better consumer tools that will aid people when attempting to identify a plan that suits their specific needs. As the threat of COVID-19 increases, more Americans will be shopping for healthcare coverage. If consumers could have the tools and assistance necessary to successfully navigate the marketplace, one could argue that more people would be willing to enroll, which in turn, would gradually reduce premium costs.
48 percent of Americans, however, believe that the ACA should be overturned due to the fact that it prevents consumer sovereignty. However, according to a Gallup Poll published in December 2019, 55 percent of consumers believe that the ACA is absolutely necessary in order to protect those Americans with preexisting conditions. Requiring protection for preexisting conditions does not require the ACA.
The majority of American consumers believe that the government should provide and maintain universal healthcare that not only protects consumer sovereignty but ensures affordable coverage against the threat of COVID-19 and pre-existing conditions. The Court should be careful to exclusively focus on the law and not to venture into policy disputes, especially when policy consequences would be tremendous.
Congress, however, should look for pathways to full coverage for the uninsured. As for Americans who opt into the ACA, Congress should make sure they can get a plan that provides for their needs at an affordable rate. Other pathways include “providing a 90% subsidy for COBRA or other insurance coverage,” especially for those Americans that have recently lost their job as a result of the COVID-19 crisis, and providing funds to support new reinsurance schemes.
The ACA may not be perfect, but at sensitive times like these, we are not in a position to strip millions of Americans of their healthcare coverage. In the short term, we should be expanding the ACA enrollment period so that uninsured Americans can get coverage, establish an emergency risk mitigation program in order to prevent rising premiums, and provide insurance subsidies for both the consumer and business that provide coverage to reduce overall premium costs.
Aaron Morrison is a policy intern policy analyst at the American Consumer Institute, an education and research organization. For more information about the Institute, visit www.TheAmericanConsumer.Org or follow us on Twitter @ConsumerPal.