Despite what he claims, Attorney General Patrick Morrisey’s new bill won’t protect people with pre-existing conditions from losing their health coverage if, as he hopes, the courts strike down the Affordable Care Act (ACA).
The Attorney General is trying to have it both ways. He’s signed West Virginia onto a lawsuit in which the Trump Administration and 17 other states are asking the courts to strike down the ACA. Facing concerns, however, that its demise would let insurers go back to denying coverage or charging more to people with pre-existing conditions, he’s now proposing a bill to prohibit that practice, calling it the “best of both worlds.”
In reality, no state law can protect West Virginians with pre-existing conditions – or other state residents – from the dire consequences if the Attorney General’s position in the lawsuit prevails.
To be clear, the ACA remains the law of the land, and experts across the political spectrum agree that the legal arguments for striking it down are extraordinarily weak. Nevertheless, the U.S. Fifth Circuit Court of Appeals recently endorsed part of the argument against the ACA and sent the case back to a U.S. District Court to decide how much of the law should fall.
Though the ACA’s defenders (which include more than 20 other states) have appealed, the ongoing litigation casts a cloud of uncertainty over the law, and the coverage and protections it provides.
Any final court decision to strike down the law would have severe consequences.
West Virginia would lose its Medicaid expansion under the ACA and federal premium tax credits that have helped low- and moderate-income residents pay their premiums, costing the state over $1 billion in federal funding. Some 162,000 West Virginians would lose their health insurance, almost doubling the state’s uninsured rate.
Striking down the ACA would also end important Medicaid and Medicare improvements, for example forcing seniors to pay more for drugs, and it would cause massive uncertainty and disruption in both programs by abruptly changing the rules for how Medicare plans and providers get paid and how individuals can enroll in Medicaid.
Morrisey’s bill would do nothing to avert these consequences. It ignores the elimination of Medicaid expansion, cost increases for seniors in Medicare, and disruption for children and parents seeking Medicaid coverage. And when it comes to the elimination of premium tax credits, it creates a state commission to study the problem, but doesn’t provide a single dollar to replace the lost federal funding.
The bill does purport to reinstate the ACA’s protections for people with pre-existing conditions. But even there, it falls far short of a solution.
First, reinstating these protections without reinstating the tax credits that help people afford individual market coverage wouldn’t do much for consumers. Eliminating these tax credits would put coverage out of reach for many, and healthy people would be especially likely to drop their plans. The tax credits serve as a powerful financial incentive for them to enroll in coverage, which helps balance an insurance pool that also includes people with serious and costly health needs.
The exodus of healthy consumers would cause large premium increases for those who remain and major disruption in the individual market. In fact, the non-partisan Congressional Budget Office (CBO) predicted that maintaining the ACA’s consumer protections while ending its subsidies for individual market coverage would cause the individual market to collapse in much of the country and cause premiums to spike sharply elsewhere. CBO based its projections partly on the pre-ACA experiences of states that did what the Attorney General now proposes – prohibit discrimination based on pre-existing conditions without providing financial assistance.
Second, West Virginia can’t reinstate some of the ACA’s most important consumer protections. While less well-known than its individual market reforms, the ACA created important protections for people with employer coverage – including banning annual and lifetime limits. But generally, only the federal government is allowed to regulate the health insurance that self-insured large employers offer, so state legislation can’t protect the majority of workers.
Third, it’s not clear whether the Attorney General’s bill even fully prohibits discrimination based on pre-existing conditions for individual market consumers. Unlike the ACA, it doesn’t state clearly that insurers must accept anyone who applies for coverage. Notably, it also omits the ACA’s protections against health care discrimination on the basis of race, color, national origin, sex, age, or disability.
For West Virginia and every other state, the answer isn’t to tear down the ACA and enact an ineffective state law. Instead, policymakers should work to improve the law to make health coverage and health care more affordable for West Virginians.
Kat Stoll is the Policy Director and Director of West Virginians Together for Medicaid.
Aviva Aron-Dine is the Vice President for Health Policy at the Center on Budget and Policy Priorities.