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ACA Sabotage: Weakening Consumer Protections

April 20, 2018

Up until recently, sabotage has been a series of subtle or not-so-subtle actions that felt a bit indirect and were certainly ill-willed but weren’t systematically written down and articulated as official policy. That changed earlier this week. The administration released its final guidance to insurance companies and states for individual and small group plans in 2019. This directly effects close to a million Pennsylvanians, including 389,081 through Let’s looks at these changes:

For individual and small group plans, the biggest changes weaken the consumer protections of the Affordable Care Act and favor insurance companies:

  • States and plans can now scale back on the essential health benefits. This means that instead of requiring all hospital stays be covered, a plan with the state’s permission could substitute more outpatient services and put limits on hospital stays. It could also refuse to pay for more expensive treatments so long as it covers other services, like prescription drugs, that could also treat that condition, even if they are not as effective. It could also offer fewer drugs or visits within those categories. Plans will still need to cover all 10 essential health benefits, but not equally.  As a result of this, consumers could see some required benefits made optional or eliminated altogether.
  • New rules have been added to make it harder for lower-income consumers to enroll or receive financial assistance, and in-person assistance is expected to be scaled back even more than last year.  This is because the administration eliminated the requirement to have at least two navigators in a state and have at least one of them be a community-based nonprofit organization.
  • Insurers will be able to impose larger rate increases without public scrutiny and accountability. Under the ACA, any increase above 10 percent was subject to review. Now the threshold will be 15 percent.
  • Plans will now be able to take more dollars for their own profit and gain rather than providing care for enrollees. Currently, companies need to spend at least 80 cents on the dollar for patient care, but now they will only need to spend 79 cents. No big deal? When you take in billions, that cent adds up quickly.
  • Regulators, in states like Pennsylvania that use, will need to work even harder reviewing plans to ensure they have enough doctors or providers in their networks without having any additional funding or capacity.
  • Plans will not have to meet as rigorous requirements related to publishing their lists of covered drugs, pricing, and restrictions.
  • Lastly, it eliminates attempts to standardize plans for easier comparison by consumers shopping for coverage.

While Republicans in Washington failed to repeal the Affordable Care Act, the administration has articulated a clear plan for weakening most of its protections by giving states more “flexibility” to put insurance companies back in the driver’s seat.