Where does the ACA go from here? (updated)

9:22am Nov. 6th: See updates at end


There's still millions of ballots left to count, and no doubt some legal battles gearing up, but as of 11:00am on November 4th, the most likely scenario going into 2021 will be:

  • Joe Biden will be sworn in as the 46th President of the United States.
  • Democrats will continue to control the U.S. House of Representatives, albeit with a smaller margin than they have today.
  • Republicans will continue to control the U.S. Senate, albeit with a smaller margin than today (either 52-48 or possilbly 51-49 depending on an upcoming runoff election in Georgia).

The Texas Fold'em lawsuit (official name: CA v. TX, formerly TX v. Azar) is scheduled to be heard by the U.S. Supreme Court (6-3 conservative) just 6 days from today, on November 10th.

Keep in mind, however, that while the hearing will happen next week, their actual decision isn't expected to be announced until next spring...most likely between April and June.

As I've repeatedly noted, this gives Democrats a window of opportunity to make the entire case moot...if they're able to pass a simple bill through both the House and the Senate to either raise the federal individual mandate penalty to $1 or higher; clarify that the mandate is severable from the rest of the law; or remove the mandate language altogether.

With a Democratic trifecta, any of these would be doable (although two of the three would likely require killing the filibuster first, and the third would require using the "reconciliation" procedure which can get messy). Without a Democratic trifecta...well, let's just say that it would be in Mitch McConnell's hands and leave it at that.

Of course it's also possible that such a move won't be needed at all. There's a decent chance--even with Amy Coney Barrett having been sworn in--that the Court won't strike down the ACA after all (or that they'll only strike down the mandate language, which would amount to the same thing).

Let's suppose that Biden is sworn in as President in January, Democrats do narrowly hold the House and Republicans do retain a small majority in the Senate. What then?

Well, first of all, Biden's Justice Department would presumably immediately withdraw from the case...and instead turn around and start defending the ACA against it. As you may recall, about six months after the Texas Fold'em lawsuit was originally filed, there was a hell of a bombshell announcement scooped by law professor & ACA legal expert Nicholas Bagley, in which Donald Trump's Justice Department essentially decided to throw the fight...that is, instead of defending the law of the land, they refused to.

In fact, they went a step further and formally declared that they agreed with the plaintiffs that the ACA should be struck down (they actually changed their stance on this...at first they "only" wanted the ACA's pre-existing condition protections nullified, but the following spring Trump's new Attorney General, William Barr, announced that the Administration wanted the entire law wiped out.

I have no idea whether the DoJ flipping sides would make any difference in SCOTUS' ruling, since it would happen a couple of months after the oral arguments already happen...but it wouldn't hurt.

In addition, a Biden Administration could do quite a bit via executive administrative orders, just as Obama did when faced with a hostile Senate (and as Trump did over the past four years).

For instance, he could immediately reverse every Executive Order issued by Donald Trump which has harmed or sabotaged the Affordable Care Act, including things like Seema Verma's bastardization of Section 1332 "Innovation Waivers" which are supposed to strengthen the effectiveness of the ACA but which she's warped into ripping away its guiderails. It could put a stop the Medicaid work requirements which Verma seems obsessed with approving even in the face of repeated court losses, and so on.

My colleague Andrew Sprung (Xpostfactoid) has beaten me to the punch on this with a great post in which he notes that Sen. Elizabeth Warren already did an extensive write-up of some of the steps Biden could take, including things like:

  • Use compulsory licensing authority to bypass patents on overpriced essential drugs.
  • Enforce mental health parity (mandated by the ACA but far from implementedJ).
  • Fund ACA outreach/enrollment assistance, cut by 84% by Trump administration in states using Healthcare.gov.
  • Ban LGBTQ discrimination.
  • Restore mandatory contraceptive coverage.
  • Kill the ban on Title X and USAID funding for organizations that perform abortions.

Warren even made a good case for using executive power to fix some of the ACA's more glaring issues, such as the "family glitch".

Another colleague of mine, Dave Anderson, has also chimed in:

In January, there will be a divided government. This severely restricts the possibility space for legislative health policy. Anything that can pass Congress will need Speaker Pelosi and likely Majority Leader McConnell’s agreement. I am not sure that there is all that much that will fit that description. There might be a chance of something on prescription drugs. There might be a chance on something getting to the White House on balanced billing that may be very favorable to clinical interests, but there is no agreement zone for large expansions of public insurance coverage.

Beyond that, in a Biden vs. McConnell scenario, you can kiss any Big Plans for universal healthcare coverage goodbye. The Public Option is gone. Free marketplace coverage to those caught in the Medicaid Gap? Gone.

If that's how it plays out, the ACA would basically revert back to its pre-Trump status: Mostly operational, but with the same inherent shortcomings & problems..minus the individual mandate penalty (although five states have already reimplemented their own anyway).

My guess is that the only part of BidenCare which he might somehow convince Mitch McConnell to agree to would be killing the Subsidy Cliff--that is, the 400% FPL income threshold cap beyond which ACA exchange enrollees aren't eligible for financial subsidies. If I turn my head and squint, I kind of see a path in which McConnell agrees to do this as part of a big, must-pass omnibus spending bill (like the long-overdue COVID-19 package bill, for instance, or perhaps a Continuing Resolution to keep the federal government from shutting down again.

Don't get me wrong--Mitch McConnell hasn't suddenly decided that he wants to save or improve the ACA...but he might also decide that public opinion on it has improved enough that both saving and even improving it a bit makes more sense politically, now that the "repeal" fire seems to have finally gone out of the bellies of many Republicans. Also, I guarantee that it wouldn't beef up the subsidy formula as Biden's plan calls for; it would just remove the income cap for those eligible.

Of course, McConnell wouldn't agree to anything like this on its own. He'd demande something big in return. What that might be, I have no clue, but I'm sure I wouldn't be happy about it.

Anyway, even this might be a pipe dream, but it's the best I can come up with at the moment.

UPDATE Friday morning: There've been a few major developments since I posted this a few days ago.

  • It's (nearly) official: Trump has been defeated. Joe Biden will become the next President of the United States.
  • There's still a chance of Democrats taking control of the Senate, via not one but two runoff elections in Georgia!
  • There's also an admittedly very slim chance of Democrats flipping two other Senate seats in Alaska and/or North Carolina.

It's really the second and third of these bullets which could change the dynamics of everything I posted above.