This time last year, prospects for the Affordable Care Act (ACA) didn’t look good. President-elect Trump had repeatedly vowed to repeal the ACA on “day one” of his new administration. With Republican majorities controlling both the Senate and the House, repeal did seem more than likely. Less certain was whether a replacement plan would actually materialize and what it would contain. The ACA had already survived multiple near-death experiences—including a final showdown in the Supreme Court, where it avoided being struck down entirely by a single vote—but maybe its days were truly numbered.
The stakes could not have been higher. An estimated 20 million Americans have gained coverage since the major provisions of the ACA were implemented in 2014. In New York State, the uninsured rate has fallen to 5%, a historic low. Gains have been seen across all segments of New Yorkers, and in every county. And while open enrollment for 2018 continues until January 31st in New York State, early enrollment figures from the New York State of Health Marketplace are strong: more than 4.1 million people had signed up for coverage by December 15th, outpacing the previous year’s sign-ups.
2017 was tumultuous, to say the least, with multiple attempts to repeal the ACA. The House passed the American Health Care Act in May (remember that Rose Garden ceremony?). Most expected that the Senate would follow suit with the Better Care Reconciliation Act, but an overnight vote saw the measure fail (remember Senator McCain’s dramatic thumbs-down?). Congressional leaders vowed to move on to other topics and repeal seemed dead.
It wasn’t. A serious—but by no means fatal—blow to the ACA was finally dealt in the tax reform law passed in the final days of December 2017. The law repealed the individual mandate, an unpopular but important part of the ACA designed to ensure that both healthy and sick people enroll and to keep costs down. Estimates of the likely impact vary widely, but the nonpartisan Congressional Budget Office (CBO) estimates that the repeal will lead to an increase of 4 million uninsured Americans by next year, and 13 million more uninsured by 2027. That’s a substantial erosion of the coverage gains we’ve witnessed.
It’s hard to predict how the loss of the mandate will affect New York State, but all ideas to stabilize the markets and keep premiums down should be considered. One option would be for New York to establish a State mandate, in the same way Massachusetts did back in 2006. Other options—but expensive ones—would be to fully fund a high-risk pool or reinsurance program.
Threats to the progress we’ve made in New York State go beyond the repeal of the individual mandate. Here are just a few:
1. Uncertain funding for the Essential Plan. For low-income New Yorkers who earn too much to qualify for Medicaid, the Essential Plan has been a popular free or low-cost ($20 per month) coverage alternative. More than 700,000 New Yorkers rely on the program for coverage. But because the Essential Plan is funded in part through federal cost-sharing reduction (CSR) payments, its future is cloudy. President Trump issued an executive order to end CSRs in October, and bipartisan congressional efforts to restore the funding have stalled out. New York State could lose nearly $1 billion annually in CSR payments for the Essential Plan.
The Essential plan is nothing less than…essential. New York State should take every step—up to and including legal action—to reinstate federal payments, continue the Essential Plan, and protect affordable health care for hundreds of thousands of its residents.
2. DACA remains under threat. Approximately 10,000 Dreamers (young people enrolled in DACA, the Deferred Action for Childhood Arrivals program) are covered by Medicaid in New York State. The Trump administration announced in September that it would rescind the program, but the President challenged Congress to come up with a plan to preserve DACA by the time the program expires in March, less than two months from now. (Although just last night, a court ruled that DACA must be maintained; more legal wrangling will surely follow.) Many members of Congress have expressed support for and promised action to protect the Dreamers, but so far we’ve seen no meaningful action.
As I’ve written previously, there are State-level options that could continue Dreamers’ Medicaid eligibility and coverage; New York should be prepared to act based on what happens in the courts and Congress. The State has the authority to classify all current DACA recipients as “permanently residing under color of law,” a status that would allow income-eligible Dreamers to continue to receive Medicaid. Doing so would have almost no additional cost because these funds are already included in the State’s budget.
3. Stalled efforts to renew CHIP. In a year full of surprises, one of the bigger shocks was Congress’s failure to renew the Children’s Health Insurance Program (CHIP). With a long history of bipartisan support, that seemed like a slam dunk that might even get used as a “sweetener” along with repeal efforts. Yet a long-term funding fix hasn’t yet come together. Some states will run out of funding as early as next week for the program, which covers nearly 9 million low-income American children. New York is projected to expend its existing CHIP funds by March. The most recent CBO estimate says that it will cost only $800 million to fund the program through 2027; that’s about $89 per kid enrolled in the program. I vacillate between dismay and rage that even coverage for children could fall victim to the health care wars.
4. Possible introduction of Association Health Plans (AHPs). The new year brought another threat to stable and affordable coverage when the federal government proposed rules for AHPs, which are designed to allow small businesses and people who are self-employed to band together to purchase more affordable health insurance coverage. That sounds good in theory. But there’s a catch of course. AHPs could siphon off younger and healthier workers, driving up costs for sicker people. AHPs could also skirt the consumer protections and essential benefits required under the ACA and under state laws.
Experience with AHPs has not been positive. A recent Health Affairs blog post points out that “Many [AHPs] have left a legacy of insolvency and fraud, with millions in unpaid claims for policyholders and providers.” Is it any wonder that the National Association of Insurance Commissioners, the National Governors Association, and the National Conference of Insurance Legislators, along with more than 1,000 state government, business, labor, consumer, and health care provider groups, have expressed concerns about AHPs? You can too; the public comment period for the proposed rules is open through March 6th. Use your voice.
All these threats are real, but we can’t give up on the progress we’ve made. In his State of the State address last week, Governor Cuomo reiterated that in New York, “health care is not just for the rich and well off—it is a human right.” An unwavering belief in that vision will guide us as we prepare for the battles ahead. Let’s start the new year with hope and renewed energy to keep fighting for what’s right for New Yorkers.