On November 10, the U.S. Supreme Court heard oral arguments for California v. Texas, a case that could decide the fate of the Patient Protection and Affordable Care Act (ACA). The central issue for the Court is determining whether the minimum essential coverage provision of the ACA – commonly known as the individual mandate – is constitutional now that the tax penalty has been set at $0. If the Supreme Court declares the individual mandate unconstitutional, they will decide whether the mandate can be severed from the rest of the law or if the entire ACA – including protections for people with pre-existing conditions – should be struck down with it. The outcome of this case and the actions taken by Congress and the Administration over the next few months are expected to impact health care access for all Americans including the psoriatic disease community.
This article will break down the history of access to care for people with pre-existing conditions, the current court case, possible outcomes, and the impact of the Supreme Court’s decision on Americans with pre-existing conditions.
History: Accessing Health Care with Pre-Existing Conditions Before the ACA
Prior to the ACA, people with pre-existing conditions were subject to medical underwriting, meaning they could be charged higher premiums, denied coverage altogether or offered a plan that excluded services related to their pre-existing condition. In addition to denying or charging more for coverage, insurers created annual and lifetime limits, leaving those most in need of health care services vulnerable to untamed out-of-pocket costs.
Over the years, states and the federal government took some actions to limit discrimination based on pre-existing conditions, but these protections were piecemeal and did not adequately shield people with pre-existing conditions from higher costs or gaps in coverage. Prior to the ACA, some states took action to protect their residents from discrimination due to a pre-existing condition on the individual market by requiring guaranteed issue or placing limits on exclusions for services related to pre-existing conditions, called waiting periods. States also created high-risk pools, which covered uninsured individuals who could not get coverage on the individual market due to a pre-existing condition. Although they were able to obtain coverage, members frequently paid premiums that were 150-200% what their counterparts without pre-existing conditions paid.
The ACA was the first to extend protections to all Americans with pre-existing conditions. In addition to guaranteeing coverage, the ACA also did away with medical underwriting altogether, stating that premiums could only vary based on age, geographic area, tobacco use and number of family members on the policy. The ACA also created many other protections that improved access to care. This list is not exhaustive:
- The ACA made comprehensive health care more affordable for individuals living with chronic diseases or pre-existing conditions: premium tax credits for individual marketplace plans, annual out-of-pocket maximums, closing the Medicare Part D Donut Hole.
- The ACA made health insurance more accessible: an individual marketplace outside of employer coverage, Medicaid expansion, young adults allowed to stay on their parent’s insurance until age 26.
- The ACA improved quality of care: required coverage for Essential Health Benefits including $0 copays for certain preventative care.
While elements of the law have improved access to care, particularly for those living with chronic diseases and disabilities (request a free disability e-kit to learn more), it has faced criticism. One element of the law that has faced continuous legal challenges is the individual mandate. The individual mandate requires that most Americans have health insurance or pay a tax penalty. In 2012, the Supreme Court ruled that individual mandate was constitutional under Congress’ power to tax, therefore upholding the law in its entirety.
In 2017, the passage of the latest tax reform bill set the ACA individual mandate penalty at $0, which is the basis of the California v. Texas court case. 18 states, led by Texas, have sued the federal government seeking to have the entire ACA struck down, arguing that because the individual mandate has a $0 penalty it no longer falls under Congress’ power to tax. With the Court set to hear oral arguments on November 10, there are several outcomes that could happen in the case and each outcome has varying levels of impact.
The Court could find that the individual mandate is unconstitutional and can invalidate only that provision. This decision would leave the ACA essentially the same as things are today. During the trial court proceedings, the federal government argued that the protections for pre-existing conditions could not stand without the individual mandate. If the Court agrees with that argument and strikes down both the mandate and the protections for pre-existing conditions, certain aspects of the ACA would stand such as Medicaid expansion and it would be up to individual states to reinstate the insurance protections on their own. The Court could also find that the plaintiffs bringing the case have no standing, thereby leaving the ACA fully intact. Lastly, the Court could also invalidate the law in its entirety, if it finds that the individual mandate is unconstitutional and inseverable (not able to be separated out) from the ACA overall. This would be the most far-reaching decision and would create significant uncertainly for a health care marketplace ten years removed from the old system of coverage.
Ahead of the 2020 election, Congress and the Administration tried to address pre-existing conditions protections should the ACA be overturned in the Supreme Court. In September, President Donald Trump signed an Executive Order stating that “It has been and will continue to be the policy of the United States to give Americans seeking healthcare more choice, lower costs, and better care and to ensure that Americans with pre-existing conditions can obtain the insurance of their choice at affordable rates.” However, such a policy cannot be enacted through regulation, meaning Congress would have to pass legislation to implement such a policy should the Supreme Court overturn those protections in California v. Texas.
At the beginning of October, the Senate voted on legislation that sought to protect pre-existing conditions protections should the Supreme Court invalidate the ACA. The bill, sponsored by Senator Thom Tillis (R-NC), would prohibit insurers from denying health insurance to applicants based on pre-existing conditions, charging higher premiums and excluding pre-existing conditions from coverage. While it would keep some of the existing patient protections should the ACA be thrown out, it would also allow insurers to again implement harmful practices such as annual and lifetime limits on how much they will spend for a patient’s health care, eliminate the patient out-of-pocket maximum, and allow insurers to charge higher premiums based on non-health factors such as gender. The bill did not pass the Senate, with many Senators arguing the bill did not go far enough in protecting patients from harmful insurance practices.
What it Means to Protect Pre-Existing Conditions
While many agree that it is important to protect people with pre-existing conditions, there is not consensus about the definition of “protections” or the best way to achieve this goal. As the patient advocacy organization for the over 8 million Americans with psoriatic disease, NPF is focused on ensuring our community has affordable access to comprehensive care.
All of our advocacy efforts are guided by our Access to Care Statement, which is approved by our Medical Board. Among the many guiding principles in the statement, there are two that are especially helpful in guiding our stance on what it means to protect people with pre-existing conditions.
- NPF supports federal and state policies that promote adequate, affordable and accessible health care for our community.
- NPF opposes policies that intentionally discriminate based on psoriatic disease status or individual characteristics.
Drawing from these statements, it is clear that guaranteed coverage alone does not adequately protect our community. People with psoriatic disease don’t just need health insurance. They need health insurance that covers health care provider visits, preventative care, mental health services, hospital care, prescription drugs, and more. And they need this care at a price they can afford.