The past few weeks have tested the U.S. health care system, exposing major gaps in access to testing and treatment of the novel coronavirus disease (COVID-19). To combat the growing COVID-19 pandemic, which promises to create a surge of provider visits and hospitalizations, comprehensive and affordable insurance coverage is crucial to protecting the health and wellbeing of millions. In a world where we are all at risk of contracting and spreading COVID-19, it is abundantly clear that access to health care is a universal human need. However, under our current system, insurance coverage, which ensures that that care is paid for, is not a guarantee. Still, facing this pandemic would have been even more difficult if it weren’t for the Affordable Care Act (ACA).
That is why, in the midst of this unprecedented public health crisis, there is one event that CHIR will be celebrating (separately, of course, and from the safety of our homes): the ACA’s 10th anniversary. The landmark health law was signed into law on March 23, 2010, and fundamentally changed the insurance landscape. Here are some of the ACA’s reforms that led to historic levels of coverage, and help protect people in this time of great uncertainty:
Preventing Discriminatory Practices
One of the fundamental goals of the ACA was to make it so that everyone, no matter their health status, could access quality and affordable health insurance. Prior to the ACA, health insurers could discriminate against sick people and populations deemed “risky” for high health costs (such as women of childbearing age) by charging higher premiums, refusing to cover treatment for preexisting health conditions, or even denying coverage based on health status.
The ACA prohibited these practices through federal standards such as guaranteed issue of coverage, a ban on preexisting condition exclusions, and rating rules that stop insurers from charging higher premiums to sick people. We know that people with underlying conditions are at a higher risk of contracting a severe illness from the novel coronavirus than healthy ones. We’re grateful those discriminatory practices that, 10 years ago, would have barred them from coverage are no longer permitted.
Providing Comprehensive Coverage
Before the ACA, even people who were healthy enough to obtain insurance coverage faced challenges to accessing health services; individual coverage often excluded or limited coverage for services like prescription drugs, mental health and maternity care.
Under the ACA, most individual and small group health plans have to cover a set of services deemed “Essential Health Benefits.” These coverage requirements, which include benefits such as laboratory services, prescription drugs and hospitalization, ensure that consumers have insurance policies that provide pathways, not road blocks, when they need health services, including testing and medically necessary hospitalization related to COVID-19.
The ACA also requires health plans to cover recommended preventive services, such as child well visits, mammograms, and colonoscopies without cost-sharing. If a novel coronavirus vaccine is ever developed, the ACA will ultimately require free access to that, too.
Banning Coverage Limits
Before 2010, health insurance enrollees could “use up” their coverage, hitting either an annual or lifetime dollar limit. In 2009, the year before the ACA’s enactment, 89 percent of individual market enrollees and 59 percent of workers enrolled in employer coverage were subject to lifetime dollar limits. If enrollees hit their limits, they could be exposed to exorbitant medical bills.
Setting limits on health benefits poses a huge issue for people with high-cost health needs, due to the high price tag on health care in the U.S. Since the ACA’s reforms went into effect, millions of people reported an easier time paying medical bills. Although we still have a long way to go to prevent the significant financial burden of getting sick in this country, the ACA’s ban on coverage limits ensures that, in the event of expensive treatment regimens or a long hospital stay, consumers won’t have to worry about “capping out” their health insurance.
Reducing the Financial Strain of Premiums and Out-of-Pocket Costs
The ACA established health insurance marketplaces for people without an offer of affordable employer coverage to find comprehensive health insurance. To promote access to insurance, it also established income-based subsidies for premiums and cost sharing, as well as an expansion of Medicaid, ultimately implemented on a state-by-state basis, to help low-income people sign up for coverage. In addition to financial assistance, the ACA limits the amount of annual out-of-pocket costs, such as copayments, coinsurance and deductibles, that a plan can impose on consumers.
Purchasing insurance and paying out-of-pocket costs can pose huge obstacles to obtaining health care services. The ACA’s Medicaid expansion, financial subsidies, and out-of-pocket maximum help millions of consumers afford the coverage and care that they need.
The Next Ten Years?
On its 10th anniversary, the ACA is going to work, protecting consumers, setting minimum coverage standards, and establishing fair market rules that create greater access to affordable, comprehensive health insurance. As large numbers of workers are laid off or forced to cut back their hours and lose benefits in the midst of a severe economic downturn, the insurance marketplaces and Medicaid expansion (in states that adopted it) will provide a crucial safety net for individuals and families to get coverage. But challenges remain; a lawsuit threatens to overturn the ACA in its entirety, gutting the federal standards and financial assistance that led to unprecedented levels of coverage. Even today, millions of people are already uninsured or underinsured, and affordability remains a challenge.
Policymakers are navigating uncharted waters in the fight against the novel coronavirus. In recent weeks, we have seen states step up to fill some of the gaps in coverage, and federal actions that reduce barriers to testing and treatment. This pandemic is the most challenging health crisis our generation has ever faced. Much more aggressive federal and state actions will likely be needed, but the ACA has provided us with a stronger foundation than we would have had 10 years ago.