Trump's Newest Assault on Obamacare
Two weeks ago, the U.S. Department of Justice (DOJ) filed a legal brief in support of a Texas lawsuit that would kill one of the most popular provisions of the Affordable Care Act (ACA): the one that ensures people with past medical problems can get affordable health insurance. It’s the latest twist in the Trump administration’s unrelenting campaign to sabotage “Obamacare,” even if that means pricing sick Americans out of health coverage altogether.
The DOJ’s intervention raised eyebrows since it marked a further politicization of a federal agency whose mission is to enforce laws passed by Congress. Instead, it is trying to unravel the law that President Trump and his party failed repeatedly to “repeal and replace.” It’s an undemocratic run around the legislative branch, an attempt by President Trump to win in court what he could not win in Congress.
Generally speaking, if you have a preexisting condition — a chronic condition such as asthma, a past cancer diagnosis, or pregnancy — and are covered by Medicare, Medicaid, or private group insurance, you are protected financially from the costs of those conditions. But prior to the ACA, those in the individual, or non-group, market could be denied coverage for being sick or pregnant. In fact, 18 percent of individual market applicants were denied coverage before the ACA and many more did not apply for coverage or were offered it only at unaffordable prices.Today, roughly 27 percent of adults (52 million people)not eligible for Medicare have preexisting conditions — these people would be the most at risk if these protections are thrown out.
The ACA embraced a three-legged stool to help make coverage affordable and sustainable in the individual market. First it required everyone to obtain insurance; secondly, it subsidized coverage to make it affordable; and finally, it prevented insurers from denying coverage (guaranteed issue) or raising premiums based on preexisting conditions (community rating). Republicans in Congress and the Trump administration have already gone after the first two legs — repealing the individual mandate penalty and ending cost-sharing reduction (CSR) payments to insurers. And now they are coming for the consumer protections despite President Trump’s promise to “ensure that Americans with preexisting conditions have access to coverage.”
Say for example that you were once diagnosed with breast cancer, but it’s now in remission. Without guaranteed issue or community rating (when insurers make premiums the same for people of the same age and location), many health insurers would decline coverage rather than take on the risk of a recurrence. Or to hedge against that risk, they might charge premiums so high you couldn’t possibly afford it. That’s the world we will return to if the White House has its way and the courts rule against the ACA.
The GOP’s efforts last summer to eliminate the ACA foundered in part on public concerns about losing protections for preexisting conditions. Kaiser Family Foundation polling showed the majority of the public — and even a majority of Republicans — favored continued protection for people with preexisting conditions. Yet only Republican Senators Lisa Murkowski (R-AK), Susan Collins (R-ME), and John McCain (R-AZ) joined Democrats to defeat a repeal package.
That’s why conservative activists in Texas and other states have taken to the courts to eviscerate the ACA. In 2012, the Supreme Court upheld (NFIB v. Sebelius) the ACA on the basis that the individual mandate penalty was a tax. The Texas lawsuit now argues that since the individual mandate penalty — the tax — has been eliminated, the requirement to buy insurance without a penalty is illegal. They say that given the elimination of the tax, the whole law is now unconstitutional.
The Trump DOJ weighed in with a less sweeping view, arguing that eliminating the individual mandate is not “severable” from the other legs of the stool. Therefore, they say that only provisions tied to the individual mandate — including guaranteed issue and community rating — should be abolished. These provisions together were designed to enlarge the pool of people who have insurance and thereby spread the risks and costs of sickness across a larger population. That’s how insurance markets are supposed to work, and it’s how health plans can hold down premium costs.
While the case continues to work its way through the courts, progressives need to remind voters of the Republicans’ broken promise to protect consumers from the costs of preexisting conditions. The ACA was intended, among other things, to ensure that Americans could obtain meaningful insurance coverage that would cover the costs of care when required. This is just the latest move among many Republicans have taken to undermine these consumer protections and support policies that would do exactly the opposite. And make no mistake, the main victims of GOP hypocrisy and callousness will be the very people President Trump professes to care about — working class families whose members have the misfortune to get sick.
Arielle Kane is director of health care at the Progressive Policy Institute.