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What Pennsylvanians Need to Know About Texas v. Azar

December 19, 2018

A Texas judge’s ruling in Texas vs. Azar last Friday created mass confusion, partly because it came as a surprise, and partly because many of the headlines about it jumped to conclusions. Here’s what you need to know about the impact of the ruling on Pennsylvania and the Affordable Care Act (ACA).

Pennsylvania is not currently impacted.  To begin, the Centers for Medicare and Medicaid have already stated that they will enforce the ACA until the appeal process concludes. Even if something changes, Pennsylvania is not currently affected by the decision. This is largely because our Attorney General, Josh Shapiro, did not participate in the lawsuit. Since we did not participate, the lower court judge cannot force us to be bound to his unfavorable ruling declaring the ACA unconstitutional.

The decision is not final.  Many people hear “unconstitutional” and assume that that is a final decision. It is more appropriate to say “temporarily unconstitutional” because there are potentially two more court battles to come – a federal appeals court and the Supreme Court – before the law would become permanently unconstitutional were those courts to uphold the judge’s decision.

If upheld, the impact could be disastrous.  It is important to consider the significance of the potential impact on Pennsylvania. In this case, the judge found that the penalty for not having insurance, which Congress eliminated last year in the tax bill, was a main feature of the law and therefore the entire law cannot stand on its own.  This decision would not only affect those enrolled in coverage under the ACA, but any individual in the Commonwealth who uses health insurance. Its impact is so wide because it would overturn all of the key consumer protections and reforms implemented by the law as well as the provisions that created individual Marketplace and Medicaid Expansion.

Here are just some of the people who would be impacted were this logic to be upheld:

  • People with Pre-Existing Conditions: Nearly half of Pennsylvania’s population (5.4 million) have a pre-existing condition. The decision would strike down the two provisions that protect them – community rating and guaranteed issue – meaning that people with pre-existing conditions could be charged more for coverage and could be denied coverage.
  • People who are covered through the ACA Marketplace: Over 400,000 are covered through the Affordable Care Act marketplace. Without this option for getting coverage, many people may be forced to go uninsured. Even if the decision is not upheld, this population could be at risk.  The ruling announced one day before the end of open enrollment this year could have a chilling effect on enrollment this year and next year as a result of confusion.
  • Women: Prior to the ACA, women were charged up to 1.5 times more for coverage than men. In Pennsylvania, women were paying between 26 and 50 percent more.
  • Individuals Needing Costly Healthcare: Prior to the ACA, 4.5 million Pennsylvanians faced a lifetime or annual limit, meaning that when they needed care the most, their plan could simply stop paying.
  • Young Adults under 26: 89,000 young adults are able to remain on their parent’s plan until age 26 helping them transition into the workforce or continue their education.
  • Seniors on Medicare: 1 in 5 Pennsylvanians is on Medicare, and for them, upholding the ruling would mean the re-creation of the Medicare donut hole, increased costs for preventative care, and fewer efforts improve coordination among doctors, hospitals, and insurance companies to reduce errors. Also, transparency in the Medicare Advantage system would go away.
  • Medicaid Expansion: Over 700,000 Pennsylvanians benefit from the expansion of Medicaid. This is particularly vulnerable in the court’s ruling. Not only could the expansion of the program be overturned, but also the enhanced funds that states receive from the federal government to ensure that coverage is there.

We must remain vigilant.  Because the ACA is enmeshed in what promises to be an extended legal battle, the ACA is, once again, at risk.  As the process goes on, we must ensure that no compromises are made by Congress that would jeopardize the well-being of anyone currently protected or covered by the ACA.