The Affordable Care Act Turns 12 Today, And It Could Look Pretty Different By Year 13

Some big changes may be in store for Obamacare, depending on any action – or lack of action – by Biden, Congress and state officials.

The Affordable Care Act turns 12 on Wednesday, and the tumultuous debate over its existence seems to be over.

Polls consistently find majorities of American approve of the law. Conservatives have run out of major constitutional challenges. Repeal is not on the Republican agenda anymore, and a few weeks ago, when Sen. Ron Johnson (R-Wis.) suggested off-handedly that maybe Republicans should take it up again, he promptly walked back the statement with a news release clarifying that he didn’t really mean it.

But Year 13 could be a tumultuous one.

Officials in Washington and in state capitals face a series of key decisions about the future of Obamacare, and, depending on what they decide, literally millions of Americans could gain or lose health insurance ― although not too many people outside of political and policy circles seem to have noticed.

Here’s what’s at stake.

Making ACA Improvements Permanent

The American Rescue Plan, the COVID-19 relief bill that Democrats passed and President Joe Biden signed in March 2021, ramped up the financial assistance available to people buying coverage on their own through or state-run exchanges such as Covered California.

That boost made a big difference, reducing premiums by hundreds or even thousands of dollars a year. But the extra financial help ends at the end of 2022, when premiums will go back up for millions of insurance buyers unless Congress makes the increase permanent or at least extends it for a few more years.

Joe Biden, as a presidential candidate in October 2020, delivers remarks about the Affordable Care Act and COVID-19 at a virtual briefing with medical experts in Wilmington, Delaware. Biden had promised to reinvigorate the Affordable Care Act.
Joe Biden, as a presidential candidate in October 2020, delivers remarks about the Affordable Care Act and COVID-19 at a virtual briefing with medical experts in Wilmington, Delaware. Biden had promised to reinvigorate the Affordable Care Act.
Drew Angerer/Getty Images

A provision to do just that was part of the so-called Build Back Better legislation that President Joe Biden and Democrats in Congress put together last year and seemed on the verge of passing ― until December, when Sen. Joe Manchin (D-W.Va.) raised a bunch of objections.

Biden and Democratic leaders say they are still working with Manchin on a compromise that would include at least some Build Back Better components. Although agreement has been elusive so far, Manchin has spoken positively about the health care provisions.

Also, it would seem to be in his interest ― as it is for every other Democrat ― to avoid a big premium increase for many of his constituents next year.

“There is no Democrat in the House or Senate who has an ounce of doubt that extending [the enhanced subsidies] is good policy,” Eliot Fishman, senior director of health policy at FamiliesUSA, told HuffPost. “In the end, I just can’t imagine they’ll let them expire.”

Filling In The ACA’s ‘Medicaid Gap’

A dozen states, including Florida, Georgia and Texas, still haven’t expanded Medicaid to cover all low-income residents, as the Affordable Care Act originally envisioned.

Rather than wait for officials in those states to come around, Biden and the Democrats have discussed having the federal government insure those people directly through some kind of federal action. More than 2 million people would become eligible for Medicaid as a result, according to several estimates.

Build Back Better had such a proposal in it. It, too, could be part of an eventual compromise with Manchin.

The politics aren’t as straightforward as they are with the subsidy proposal. West Virginia already has an expanded Medicaid program, so Manchin’s constituents wouldn’t stand to benefit in the way that, say, the constituents of the Democratic Sens. Jon Ossoff and Raphael Warnock in Georgia would.

But Manchin has signaled he supports this provision anyway, giving champions of the expansion hope that it could end up passing this year.

Fixing The ‘Family Glitch’

Another way to bolster the Affordable Care Act is through executive action. The Biden administration has already begun that process in order to address what’s come to be known as the “family glitch.”

Today, a group of more than 5 million low-income Americans can’t get subsidized insurance on the exchanges even though they have no way to get affordable coverage through an employer. The reason is the formula that the federal government uses to determine eligibility ― and, in particular, how it assesses the price of coverage available through employers. (Full explanation here for those who are interested.)

“Closing the Medicaid coverage gap and fixing the family glitch would finish what the ACA set out to do 12 years ago.”

- Judith Solomon, Center on Budget and Policy Priorities

The formula works that way because of a regulatory decision in the Obama administration that many experts questioned at the time. The Biden administration has said it wants to rewrite the regulation, and that effort is now underway, with a proposed rule currently under formal review at the Office of Management and Budget.

The process will take a while to complete as the administration works through the ambiguities and disagreements over just how much it can ― and should ― do on its own. But even a partial fix could reduce the number of uninsured Americans, especially if some of the legislative proposals become law as well.

“Closing the Medicaid coverage gap and fixing the family glitch would finish what the ACA set out to do 12 years ago,” Judith Solomon, a senior fellow at the Center on Budget and Policy Priorities, told HuffPost.

Tightening Rules On Junk Insurance

The Biden administration could also reverse some of the regulatory changes that the Trump administration made, starting with Trump-era rules for “short-term/limited duration” plans.

Those plans have been around for a long time, and, as the name implies, their original purpose was to serve as a temporary form of protection for people who had short lapses in coverage ― say, because they were between jobs. They may not be available to people with preexisting conditions, and typically they have coverage gaps that expose beneficiaries to large, potentially ruinous medical bills.

The Obama administration wrote rules limiting such plans to just 90 days, on the theory that the Affordable Care Act’s offer of comprehensive, subsidized coverage made the short-term plans unnecessary. The Trump administration changed those regulations, pushing the maximum plan duration to a year and effectively allowing people to stay on short-term policies indefinitely through a series of renewals.

“‘Short term’ plans sold for up to a year of coverage should have no place in a post-ACA world.”

- JoAnn Volk, Georgetown University's Center on Health Insurance Reforms

The Trump administration’s argument was that these policies are cheaper, which for some people they certainly are. But just last week, the Commonwealth Fund released a report suggesting that the proliferation of the plans was weakening the actuarial balance of the Affordable Care Act exchanges.

Meanwhile, people who buy the threadbare protection frequently don’t recognize its limits, in no small part because companies promote the policies as an Obamacare alternative.

“‘Short term’ plans sold for up to a year of coverage should have no place in a post-ACA world,” JoAnn Volk, a research professor at Georgetown University’s Center on Health Insurance Reforms, told HuffPost. “We have ample evidence that consumers who buy these plans don’t know what they’re getting until they find out the hard way they don’t cover what they need.”

Officials in the Biden administration have signaled that reversing this rule is on their agenda. But the administration hasn’t announced that it has started the process yet, leaving open the question of when ― and if ― it will.

Preventing A Massive Drop In Medicaid Enrollment

Low-income people who are eligible for Medicaid frequently don’t enroll ― or, when they do enroll, they drop out of the program because they are confused about eligibility guidelines or struggle with the eligibility paperwork.

That can be a big problem during a pandemic, when people desperately need health care, which is why the very first COVID-19 relief bill, which Congress passed and President Donald Trump signed in early 2020, prohibited states from automatically removing people from Medicaid rolls.

The prohibition will end whenever the federal government declares an end to the COVID-19 state of emergency. (Biden administration officials have promised 60 days of advance warning.) What happens to the Medicaid rolls at that point will depend on how states handle the situation.

States can choose to take a slow, methodical approach ― by, for example, communicating proactively with enrollees, confirming that databases have up-to-date mailing addresses and making it easy for people now eligible for subsidized private insurance to sign up. Or they can rush through the process without the same level of caution.

The Biden administration has required states to make and file plans for how they intend to manage the transformation, but as of January, only half the states had done so, according to a survey by the Henry J. Kaiser Family Foundation. Without enough attention to the transition, more than 10 million people could lose coverage, according to estimates from the Urban Institute.

“President Biden has without question followed through on his promise to reinvigorate the ACA, with record enrollment in the insurance marketplace and Medicaid,” Larry Levitt, executive vice president at the Kaiser Foundation, told HuffPost. “But if care isn’t taken as the public health emergency unwinds and Congress fails to extend the enhanced premium help for ACA enrollees, the recent coverage gains could be entirely erased.”

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