ACA is the safety net we need… to protect

Before COVID-19, 28 million Americans had no health insurance, and health care costs were a factor in two out of three bankruptcies. So how bad could it get during a pandemic? That depends on how well our Medicaid and Affordable Care Act (ACA) safety net holds.

COVID-19 layoffs could cost 27 million Americans their employer-sponsored health insurance (ESI). The good news? Eight out of 10 would be eligible for Medicaid or the ACA. We just need to make it easy for them to enroll. The bad news? President Trump cut ACA enrollment assistance by 84 percent. In March, he refused to reopen ACA enrollment. And he recently sued to overturn the ACA altogether. Meanwhile, Republican governors in 13 states refuse to expand Medicaid, putting 4.5 million Americans at unnecessary risk.

Despite years of budget cuts and obstruction from Republicans, nearly 20 million Americans are enrolled in the ACA. It has given small businesses more bargaining power, increased worker productivity and mobility, and invested in preventive care that will reduce the long-term cost of chronic conditions like diabetes and heart disease. Its market-based reforms helped reduce spending on Medicaid by 21.5 percent, Medicare by 18.2 percent, and private health insurance by 6.1 percent (compared to projections made pre-ACA). It’s not perfect, but it’s progress.

Buying insurance through the ACA is complicated, like everything else in health care. That’s why the ACA funded toll-free customer service lines, enrollment drives, and local, in-person assistance. Trump cut annual enrollment assistance for federal marketplace navigators from $63 million to $10 million. Today, out of the 32 states that operate federal marketplaces, seven offer no access to navigator assistance in the majority of their counties. Four states offer no in-person support whatsoever. And Utah no longer receives any funding for navigators.

The ACA initially extended Medicaid to cover low-income workers who couldn’t afford to buy insurance from the ACA marketplace, with the federal government footing nearly all of the bill. Today, the federal government covers 90 percent of costs and the worker’s state pays 10 percent. When Republicans sued to overturn the ACA, the Supreme Court ruled that states could opt-out of this deal. The New England Journal of Medicine found when a state spends 10 cents to provide a dollar of health care to its neediest citizens, it can save money by reducing other health care costs. And some cases, cost savings outweigh any increases in state spending. Yet 13 states continue to opt-out. Before COVID-19, about 2.5 million Americans living in those states were left behind. With COVID-19 layoffs, another 1.9 million Americans could join them.

For years, Republicans have proposed to cap federal health care spending and switch from direct payments to block grants, shifting the risk of rising health care prices to states. They argue states can produce better results at lower cost. COVID-19 increases the risk of this arrangement for states in three mutually reinforcing ways. The pandemic is increasing emergency health care costs. Corporate layoffs are pushing families off ESI. And the cost of a vaccine and new treatment for COVID-19, when they are ready, is likely to be high.

You’d think Trump and Republicans in Congress would rethink their position. They haven’t. Last month, Trump sued to eliminate the ACA’s premium subsidies, Medicaid expansion, and protections for preexisting conditions. He has yet to present a plan to replace the ACA.

At a recent Business Forward briefing, Larry Levitt, executive vice president of health policy at the Kaiser Family Foundation, told business leaders: “One big difference between this recession and all previous recessions is that the ACA is there as a safety net for people losing their job-based health insurance. It’s an important safety net, but also, an imperfect one…” It’s time for Republicans to help repair the safety net instead of pulling it away.

Jim Doyle is President of Business Forward, a bipartisan network of more than 100,000 entrepreneurs, investors, small business owners, and executives working end gridlock in Washington.