If the ACA Is Repealed Under Texas v. Azar, Millions Will Lose Health Insurance Coverage
Part of a Series
To download the table that shows increases in the number of uninsured people by congressional district, click here.
The lawsuit brought by Republican state officials to overturn the entire Affordable Care Act (ACA), Texas v. Azar, continues to work its way through the U.S. legal system. In December 2018, a right-wing district court judge in Texas sided with opponents of the law, finding that the entire ACA should be struck down. Today, the U.S. Court of Appeals for the 5th Circuit will hear oral arguments and decide whether to overturn the district court’s partisan decision. Worryingly, the 5th Circuit Court of Appeals also appears to be questioning whether the defenders of the ACA have standing to intervene in the earlier ruling. Regardless of how the court rules, the odds are high that the case will then be appealed to the U.S. Supreme Court. For the foreseeable future, the ACA is in danger.
If the lawsuit ultimately succeeds, it would have devastating consequences for nearly every American who has health coverage, whether through their employer, the individual market, Medicare, or Medicaid. The Urban Institute estimates that overturning the ACA would result in almost 20 million more Americans being uninsured and would lower federal health care spending by $135 billion in 2019 alone. In this column, the Center for American Progress estimates the increase in the number of uninsured people by congressional district that would occur if the ACA were struck down.
Background on Texas v. Azar
Texas v. Azar is a politically charged attempt to repeal the ACA. In February 2018, Texas and 19 other states filed a lawsuit arguing that the ACA is unconstitutional. Their widely panned legal argument claimed that because the Republican-sponsored Tax Cuts and Jobs Act eliminated the individual mandate penalty, it rendered the rest of the ACA invalid.
Coming on the heels of repeated, unsuccessful attempts to repeal the ACA through congressional action, the Texas lawsuit is the Trump administration’s latest attempt to overturn the law. In an unprecedented action, President Donald Trump’s U.S. Department of Justice (DOJ) announced in June 2018 that it would refuse to defend the ACA. Instead, it filed a brief asking the U.S. District Court in Fort Worth to strike down the ACA’s protections for people with preexisting conditions, which prevent insurance companies from charging people more or denying them coverage based on medical history. As a result, defense of the ACA rests on California Attorney General Xavier Becerra (D), whose state is leading the fight, as well as Washington, D.C., and 19 other states that intervened in the lawsuit, and the U.S. House of Representatives.
In December 2018, U.S. District Court for the Northern District of Texas Judge Reed O’Connor sided with Texas, striking down the entire ACA. The California-led defenders of the law immediately appealed to the 5th Circuit Court of Appeals. In March 2019, as part of that appeal, the Trump administration apparently decided its position in the litigation was not extreme enough, and the DOJ filed a letter in support of Judge O’Connor’s decision to repeal the entire ACA.
It is possible that either the 5th Circuit—or eventually the Supreme Court—could default to the Trump administration’s earlier position that only provisions related to protections for enrollees with preexisting conditions are invalid. But even a narrower ruling against the ACA would have wide repercussions well beyond people who buy insurance on their own. More than 130 million Americans have preexisting conditions; without the full ACA, they could face higher rates or, if they ever needed to seek coverage through the individual market, be denied coverage altogether because of their medical history.
National and congressional district-level coverage losses
If the ACA were repealed in its entirety, health care costs for millions of families would rise. The ACA includes tax credits and other financial assistance that reduce premiums and out-of-pocket expenses for lower- and middle-income people who buy their insurance through the ACA’s marketplaces. Furthermore, repealing the ACA would drastically cut federal funding that benefits state Medicaid programs. The federal government pays states at least 90 percent of the costs for enrollees covered through the ACA’s Medicaid expansion. In total, states would lose $135 billion in federal funding for Medicaid and marketplaces enrollee financial assistance in 2019 alone, according to the Urban Institute. The states with the biggest reductions would include California, with a loss of $22 billion; New York, with a loss of $10 billion; Florida, with a loss of $9 billion; and Texas, with a loss of $6 billion.
Repeal would also harm Americans who have coverage outside the ACA’s flagship programs. In the absence of the ACA’s consumer protections, insurers could bring back annual or lifetime limits on coverage, and employers would no longer be required to extend dependent coverage to young adults up to age 26. Also void would be the ACA requirement that insurers make crucial preventive services—including contraception, mammograms and other cancer screenings, well-child visits, and vaccinations—available to patients at no cost.
Nearly 20 million more Americans would become uninsured in 2019 were the ACA repealed, the Urban Institute projects. About 15.4 million lower-income people would lose coverage through Medicaid or the Children’s Health Insurance Program (CHIP)—even if states that expanded Medicaid before the ACA maintained their pre-ACA expansion waivers. About 6.9 million people currently enrolled in the so-called individual market—those who purchase their plans directly from insurers—would lose private insurance coverage. These coverage losses would be partly offset by an increase of 2.4 million people covered by employer-sponsored insurance.
To understand the potential local impacts of an ACA repeal resulting from Texas v. Azar, CAP spread the Urban Institute’s estimates of state coverage changes across the 435 congressional districts and Washington, D.C. CAP’s analysis assumed that each district’s coverage loss would be proportional to the size of insurance coverage gains that have occurred since the implementation of the ACA’s major coverage provisions, as measured through U.S. Census Bureau data. Within a state, the variation in CAP’s congressional district estimates is determined by relative changes between the 2013 uninsured rate and the 2017 uninsured rate, which in turn were affected by takeup of insurance through the exchanges, Medicaid expansion, the Medicaid “welcome mat” effect, and other factors related and unrelated to the ACA.
On average, about 45,600 more people would be uninsured in each congressional district and Washington, D.C., if the ACA were fully repealed. Coverage reductions would generally be greater in states that took the federally funded option to expand Medicaid, but even nonexpansion states would experience sizable increases in the number of uninsured people. For example, in the 24th Congressional District of Texas—encompassing many suburban communities in the Dallas-Fort Worth metropolitan area—the number of uninsured people would swell by 52,000.
If the Supreme Court ultimately sides with partisan judges and conservative activists by striking down the entire ACA, the effects would be immediate and devastating. States stand to lose billions of dollars in funding for their populations, and individuals would face higher health care costs, greater financial vulnerability, and the prospect of losing coverage altogether. The dire consequences of ACA repeal have been spelled out time and again, but that’s not stopping the Trump administration from pushing forward with a lawsuit that would inflict harm on families across America.
Emily Gee is the health economist for Health Policy at the Center for American Progress. Charles Gaba is a health care analyst and the founder and editor of ACASignups.net.
Jesse Nadel and Tarun Ramesh provided research assistance.
The spreadsheet accompanying this column shows estimated increases in the number of people by congressional district who would become uninsured in 2019 if the ACA were overturned. In a March 2019 report, the Urban Institute projected that nearly 20 million more people would become uninsured nationwide and provided state-by-state estimates of changes in coverage. The Urban Institute’s state-level projections are reproduced in the first tab of the spreadsheet.
The table in the second tab of the spreadsheet provides CAP’s estimates of coverage reductions by congressional district and in Washington, D.C. CAP calculated coverage gains by comparing each congressional district’s rate of insurance among the nonelderly population in 2017, the most recent year for which data are available from the American Community Survey (ACS), to rates in 2013. The ACA’s major coverage expansions, Medicaid coverage to childless adults and the launch of the health insurance marketplaces, began in 2014. Each congressional district’s change in the number of people with coverage was then translated into a share of the respective state’s total coverage gain; that share was assumed to be the district’s share of the state-level coverage reductions that would occur under ACA repeal.
Four states have redistricted since 2013: Florida, North Carolina, Pennsylvania, and Virginia. For those states, CAP calculated the change in insurance coverage rates at a county level using the five-year version of the ACS for 2013 and 2017. CAP then assigned counties to the congressional districts under the 116th Congress using the Geocorr 2018 data correspondence tool from the Missouri Census Data Center.
District-level estimates presented in the table may not sum to state or national totals due to rounding.
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The U.S. Supreme Court heard oral arguments in California v. Texas, the Affordable Care Act (ACA) repeal lawsuit, on November 10, 2020. The case was brought by a number of Republican state attorneys general and supported by the Trump administration. President Donald Trump long pledged to appoint judges who would side with his administration’s political interests and rule to overturn the ACA. The death of Justice Ruth Bader Ginsburg—and the rushed process to attempt to replace her—dramatically heightened the chance that the court would strike down the law and upend its previous decisions to uphold it. Overturning the ACA would throw the nation’s health care system into chaos and be disastrous for the health and economic security of millions of Americans. The Center for American Progress provides coverage and analysis on the impact of the health care repeal lawsuit, including how it would harm people with preexisting conditions and disabilities, communities of color, women, young people, families, and low-income families.