The Affordable Care Act (ACA) dramatically increased access to health insurance for millions of Americans and improved health care quality. However, it remains unaffordable for many who are ineligible for premium subsidies and a number of states have experienced tepid insurer participation and other challenges. A concerted effort to bring the nation closer to universal coverage is needed, and some pragmatic policy proposals are described in this article.
The ACA established marketplaces where consumers could select and purchase individual health insurance, with assistance from the federal government to help lower their out-of-pocket costs. It eliminated declination of coverage for persons with preexisting conditions, required that all plans offered on the marketplace include comprehensive benefits, and limited monthly premiums to a percentage of household income. It also extended Medicaid eligibility to a much larger group of low-income adults. A recent quasi-experimental study found that marketplace-based subsidized enrollment led to improved health outcomes, including use of medical care and preventive services among enrolled persons.
Since the ACA’s enactment, more than 29 million Americans have obtained health insurance through the marketplace, and the uninsured rate has fallen to its lowest level in history. In 2018, approximately 10.6 million persons selected or reenrolled in marketplace-based coverage, and the Congressional Budget Office projects that about 14 million persons will enroll during the current open enrollment period.
Many states have taken different approaches to implementing the ACA. Some have expanded Medicaid and set up their own exchanges, while others did not implement the expansion and rely on the federal exchanges. The remainder of the states are considered “passive” – they took some role in establishing the ACA, but did not expand Medicaid or create their own exchanges, so the federal exchanges serve as their marketplaces.
The 115th Congress and President Trump made several attempts to repeal and replace the ACA, but they failed. However, they did eliminate the individual mandate penalty starting in 2019, which may reduce marketplace enrollment and increase premiums. In addition, they slashed funding for outreach and advertising, cut navigator program funding by 90%, and shortened the open enrollment period, all of which have undermined consumer awareness and confusion about the ACA’s coverage options.
To help stabilize the marketplace, the federal government should establish a permanent reinsurance program to offset some of the cost increases caused by the elimination of the individual mandate penalty and the discontinuation of cost-sharing reduction reimbursements. Further, steps should be taken to limit the sale of noncompliant individual market insurance, such as extended short-term, limited-duration plans and association health plans, which skirt ACA regulations. Lastly, federal and state regulators should ensure that all marketplace-based policies meet the ACA’s minimum essential benefit requirements. These changes will promote competition, stability, and affordability on the ACA’s marketplaces and in the individual and small group markets. They will also bring the United States closer to its goal of universal coverage.