Over the last four years, we have witnessed major changes in the health care industry, with policy changes that bear the potential for long-term impact. Here are a few of the policies rolled out by the Trump administration:
ACA Individual Mandate Repeal
The individual mandate penalty enforced by the Affordable Care Act (ACA) was repealed and went into effect in January 2019. The ACA offered incentives to low and middle-income families who earned too much to qualify for Medicaid so that they could purchase subsidized health coverage on the health insurance marketplace using premium assistance credits. At the same time, the ACA enforced an individual mandate—a penalty for those who remained uninsured. Experts argued that eliminating this mandate would encourage healthy individuals to walk away from the individual insurance market, which in turn would spike premiums for those who remained insured.
However, analysis by the Kaiser Family Foundation (KFF) found that insurers in the individual markets remained profitable through 2019 and that the individual market remained stable. From the enrollee perspective, elimination of the penalty and expansion of short-term health plans has not led to a sicker group of enrollees, at least based on hospitalization rates, according to the KFF report. However, with the COVID-19 pandemic, economic instability, and lawsuits to bring down the ACA, 2020-2021 may present a different picture in terms of enrollees and health plan premiums.
The Growth of Short-Term, Limited-Duration Health Plans
Based on a final rule issued by the Department of Health and Human Services (HHS), Labor, and Treasury, in August 2018, insurance companies can offer health insurance plans that do not have to adhere to the rules of the ACA when sold in the individual marketplace. These plans can be offered for a maximum duration of 364 days (<12 months) and extended for up to three years at the insurer’s discretion. Their minimum duration can be as little as a month. Short-term health plans have certain pros and cons:
- Lower premiums (by as much as 54% compared to ACA-compliant plans) because they primarily cover healthy individuals
- Can exclude individuals with pre-existing conditions by outrightly denying insurance or excluding coverage of pre-existing conditions
- Coverage benefits are limited compared to ACA-compliant plans: they may not cover essential health benefits such as prescription drugs, mental health care, substance abuse, and maternity care
- They are not subject to cost-sharing limits compared to ACA-compliant plans that have an annual cap of $8,150 for an individual in 2020
These plans will be attractive for healthier individuals, particularly those who buy their own insurance but do not qualify for ACA premium subsidies, leaving the ACA-compliant plans with sicker individuals who might then end up facing higher premiums. Unfortunately, many of these short-term plans are marketed to consumers without sharing details on their limitations.
Medicaid Work Requirements
Medicaid expansion post-ACA had the goal of broad health insurance coverage. While studies have shown that expansion improved coverage and access, service use, and quality of care, counter arguments have emerged that the program has broadened beyond its original intent and has increased the costs for states. As of date, 38 states and Washington, D.C., have adopted Medicaid expansion.
However, in January 2018, four years into expansion, the Centers for Medicare & Medicaid Services (CMS) announced that non-elderly, non-pregnant adult Medicaid enrollees would be required to work or participate in community activities for continued Medicaid eligibility or coverage. This 1115 waiver under the Social Security Act authorizes the HHS Secretary to approve pilot or demonstration projects that give states the flexibility to improve their programs. While the work requirement waiver demonstration received pushback from several quarters,
- Indiana and Utah have implemented the waiver, but COVID-19 may have halted the program
- The waiver is approved but not implemented in Arizona, Ohio, South Carolina, and Wisconsin
- The waiver is pending in Alabama, Georgia, Idaho, Mississippi, Montana, Nebraska, Oklahoma, South Dakota, and Tennessee
- The waiver has been set aside by the court in Arkansas, Kentucky, Michigan, and New Hampshire
Arkansas was the first state to approve these requirements in June 2018—Medicaid beneficiaries between 30 and 49 years were informed by mail that they needed to work 80 hours each month, participate in a community engagement activity, or meet an exemption criteria to qualify for continued Medicaid coverage. Consequently, nearly 17,000 adults were off Medicaid between October and December 2018, which was an estimated decrease of 12 percentage points in the state.
The Center on Budget and Policy Priorities projects widespread loss of coverage among low-income adults if work requirement policies are implemented, leading to reduced access to care, worse health outcomes, and a rolling impact on them finding or keeping a job.
Improving Rural Health Access
Under administrator Seema Verma, CMS has placed significant focus on addressing the barriers to health care access in rural America, including lack of transportation, absence of health care services, or not being able to take advantage of the latest innovations in technology or care delivery. One such effort is the recent announcement of the Community Health Access and Rural Transformation (CHART) Model—an innovative health care delivery and reimbursement model that provides rural health clinics the option of participating in:
- Community Transformation Track, which will allow the development of systems of care in rural communities
- ACO Transformation Track, to allow rural care providers to participate in value-based payment models
The models have eased certain operational and regulatory constraints for rural providers, made changes to provider payments such that they receive upfront investments, and made changes that will allow providers to address their patients’ food and housing needs along with clinical needs.
To read about some of the health care priorities of the Biden campaign, click here.
Patients Rising Now acknowledges the important contributions of Surabhi Dangi-Garimella, Ph.D. in this article. Improving patient access is our mission and we are happy to utilize a variety of experts to carry that out.