August 27, 2020

Trump Administration Continues to Chip Away at Affordable Care Act Requirements

As you have probably read in the news, the Supreme Court agreed to hear arguments in November for another case regarding the constitutionality of the Affordable Care Act (ACA).

Over the last several years, the Trump Administration has issued numerous regulations and implemented initiatives to undermine key aspects of the law—mostly with the stated goal of increasing flexibility for health care providers, patients, states, and other stakeholders. ACEP has responded to many of these policies outlining their potential impact on the coverage of emergency services and access to care for higher risk populations.

For example, last year ACEP responded to a request for information on state “1332” waivers, which allows states to submit a plan to CMS that, if approved, would allow the state to develop a different way of providing private health insurance to their residents than the ACA required (i.e., qualified health plans in the ACA Exchange). The ACA included guardrails for these 1332 waivers, mandating that states must demonstrate in their plans that they would offer coverage that was as comprehensive and affordable as residents would have otherwise received under the ACA Exchange. ACEP expressed significant concerns with guidance that the Trump Administration issued to states that created more flexible definitions of “comprehensive” and “affordable” and opened the door for states to offer less comprehensive coverage options—like association health plans and short-term, limited-duration plans—to consumers.

Further, as discussed in a previous Regs & Eggs post, ACEP opposed a voluntary initiative that the Centers for Medicare & Medicaid Services (CMS) announced at the beginning of the year that would allow states to turn their Medicaid programs into a “block grant” program. According to CMS, the Healthy Adult Opportunity (HAO) initiative would provide states that choose to participate with more flexibility to serve a segment of their adult Medicaid population, while capping the total federal funding that is available. We expressed concern that curtailing federal funds may leave states without sufficient resources to meet the needs of those most vulnerable in our communities.

It is unclear how many states will take advantage of the ACA flexibilities the Trump Administration has provided. The State of Oklahoma, which had been one of the only states to apply for the HAO initiative thus far, officially withdrew its application on August 11. As the nation continues to grapple with the COVID-19 pandemic, states may find that now is the not the best time to make substantial changes to their Medicaid programs or private insurance markets.

However, despite the fact that most of the health care community is focused primarily on combatting the pandemic, the Trump Administration recently proposed another ACA-related policy change—this one aims to provide more flexibility to health plans. Specifically, the Departments of Health and Human Services, Labor, and Treasury issued a proposed regulation that would allow greater flexibility for certain “grandfathered” health plans to make changes to their cost-sharing amounts without causing a loss of their grandfather status. As background, health plans that existed before the passage of the ACA are deemed “grandfathered plans” and are not subject to all the requirements included in the law—such as the requirement to cover the 10 essential health benefits (EHBs).

Currently, these plans are allowed to make certain changes each year and still keep their grandfathered status. According to the Kaiser Family Foundation, in 2019 22 percent of businesses offering health benefits offered at least one grandfathered health plan, and 13 percent of covered workers were enrolled in a grandfathered plan. Under the proposed reg, these plans would be allowed to increase cost-sharing for their enrollees by a higher amount than they could today while still being able to maintain their grandfather status.

ACEP submitted comments on the reg opposing the proposed changes and requesting that the Departments NOT finalize them. We believe that if enrollees in grandfathered health plans can no longer afford their insurance because these plans increase cost-sharing by too much, they may become uninsured, forcing them to increasingly rely on the emergency care safety net for health care services. This would increase costs to our health care system and put a greater strain on our already overburdened emergency departments. In addition, we believe that the reg could lead to more grandfathered health plans keeping their status instead of appropriately transitioning to non-grandfathered plans. ACEP has long supported the important requirements in ACA that non-grandfathered plans must follow, especially the coverage of the EHBs. We believe that it is critically important for all health plans to cover all 10 EHBs. Without such guaranteed coverage of the EHBs, consumers may be left with a narrow set of benefits that do not ensure access to the services they need to manage their health conditions.

Please reach out to me with any questions about these policies. As the Supreme Court hearing date approaches, I will be sure to keep my eye out for additional ACA-related policy changes that could impact you and your patients. Until next week, this is Jeffrey saying, enjoy reading regs with your eggs.

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