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How uncertainty over the ACA is affecting healthcare

How uncertainty over ACA is affecting healthcare

The uncertainty surrounding the future of the Affordable Care Act will harm access to care, according to an analysis by the Brookings Institute, a liberal-leaning think-tank.

Christen Linke Young, who specializes in health care law and policy, writes in a recent brief that an ongoing challenge to the ACA should have been easily quashed by the courts but that the decision by the 5th Circuit Court of Appeals last month to remand the case to a lower court will sow doubts in the health care market that will ultimately hurt patients.

“The extended period of uncertainty is unnecessary and will impact stakeholders across the health care industry,” she writes. “Moreover, while some uncertainty may have existed since the lawsuit was first filed or since the lower court judge reached a decision in late 2018, the Fifth Circuit’s seeming openness to the argument that the entire law should be invalidated, combined with the Trump Department of Justice embracing that view in early 2019, has increased the stakes.”

Perhaps the gravest threat to the market comes from the prospect of the ACA’s protections for pre-existing conditions being overturned. People who are counting on being able to change jobs, start businesses or retire without fear of being denied coverage may reconsider these decisions if there is a chance the ACA will be overturned.

Health care providers may also rethink investment strategies due to the uncertainty of the ACA’s future. In addition to changing provider payment formulas for Medicare and Medicaid, the ACA dramatically increased the insured rate, particularly in states that opted to expand Medicaid.

In Arkansas, for instance, the uninsured rate has dropped from 20 percent to 8 percent. Providers must be taking into account the threat of those gains being undone.

“A rural health system in Arkansas might be considering whether to invest in expanded capacity to treat individuals with substance use disorder, especially in light of the prevalence of opioid use in the state,” writes Young. “But the potential for the overall uninsured rate to more than double – wiping out coverage for substance use disorder services for many potential patients – may complicate the system’s decision-making around that investment.”

Similarly, Obamacare introduced voluntary payment models aimed at rewarding providers for cost-savings and better patient outcomes. However, says Young, providers who opted into those payment models generally did so because they believed it would work out better in the long-run, after making certain investments and changes to their processes. The possibility of the ACA going away throws a wrench into those plans.

Overturning Obamacare could also pose a big threat to manufacturers of generic versions of expensive “biological” drugs. Part of the ACA authorized the FDA to expedite approval of generics.

“But invalidating the ACA would strip the FDA of that authority, making it unlawful for them to approve any new biosimilar drug,” writes Young. “What, then, is a biosimilar manufacturer to do? Should they continue the research and development necessary to seek approval of new biosimilar drugs, which could save the health care system billions of dollars but requires an upfront investment of tens or hundreds of millions of dollars over several years? Or should they forego new biosimilar research until there is greater certainty about whether it will remain lawful to sell the product?”