The Chaos of Repealing the Affordable Care Act During the Coronavirus Pandemic

A boy waits as his father is checked by a physician's assistant before receiving a COVID-19 swab test at a clinic in Stamford, Connecticut, May 2020.

With the death of Justice Ruth Bader Ginsburg just weeks before the Supreme Court will hear oral arguments in the latest health care repeal lawsuit, the fate of the Affordable Care Act (ACA) is completely uncertain. Repealing the ACA at any point since its passage would have been disastrous to the health and economic security of millions of Americans. But repealing the ACA in the middle of the COVID-19 pandemic that has infected more than 7 million Americans and killed more than 200,000 Americans is morally reprehensible.

More than 20 million people would lose their health coverage, and more than 135 million people would lose protections for their preexisting conditions, including millions of COVID-19 survivors. Repealing the ACA in the middle of an unprecedented pandemic would create chaos across the entire health care system; weaken the country’s public health and economy recovery; and rip affordable health care coverage from millions of people at a time when access to health care services is absolutely essential.

People with preexisting conditions and disabilities, including COVID-19 survivors, would be vulnerable to discrimination by insurers

Before the ACA, insurers could discriminate against people with preexisting conditions by charging people with certain health conditions higher premiums; excluding coverage for services related to those conditions; or denying coverage outright. The ACA protects people with preexisting conditions, including people with disabilities and chronic health conditions, by prohibiting these practices. In addition, it also requires coverage of essential health benefits (EHBs) so that insurers cannot limit benefits to lower costs or discourage people who need care from enrolling in their plans. The ACA also bans lifetime and annual limits so that insurers cannot cap how much they pay for medical care each year or over a person’s lifetime.

The Center for American Progress estimated last year that 135 million nonelderly Americans have a preexisting condition. As the pandemic surges on, every American is at risk of contracting COVID-19 and becoming uninsurable if the ACA is repealed. Already, according to a recent survey, “More than six in ten households where anyone has had COVID-19 (63%) report facing serious financial problems during the coronavirus outbreak.” Without these protections, insurers could discriminate against COVID-19 survivors by increasing prices, limiting coverage, or imposing draconian lifetime or annual limits.

The coronavirus has unknown, potentially long-lasting effects on the health of coronavirus survivors. According to the Mayo Clinic, there are myriad long-term health conditions and disabilities that can result from COVID-19—even if people only had mild symptoms or were young and healthy before contracting the disease. People may have permanent heart and lung damage and may be more prone to stroke, seizures, Parkinson’s and Alzheimer’s disease, blood clots, fatigue, and mental health problems, along with a host of potential unknown conditions.

Given these uncertainties—and the wide range of health problems associated with COVID-19—in the absence of the ACA, insurers in the individual market would likely charge much higher premiums or deny coverage altogether for those who have had COVID-19. More than 150 million Americans have job-based health coverage, and those plans could also reinstate annual and lifetime limits on coverage. Treatment for COVID-19 can be extraordinarily expensive, with typical hospital bills of almost $75,000 following stays in intensive care units.

Moreover, given the wide variety of serious, long-term health problems associated with COVID-19, even those who did not require intensive, inpatient treatment may need costly treatment in the future that could reach arbitrary annual and lifetime limits. Prior to the ACA, almost 60 percent of workers were enrolled in employer plans that had lifetime limits. Many plans set lifetime limits as low as $1 million or $2 million. For people with disabilities and those requiring high-cost treatments for chronic diseases, health care costs can readily exceed this amount. Children living with the long-term impacts of COVID-19, depending on the severity of their case, could reach those caps within just a few years.

Table 1 provides state-by-state data on the current number of COVID-19 survivors as of September 29, 2020.

Table 1

ACA repeal would throw insurance markets into chaos as millions would lose coverage during a pandemic

Repealing the ACA with no viable replacement would wreak havoc on the insurance markets. It is absurd that the U.S. Department of Justice is bringing this case given the risk that it could disrupt a huge sector of the insurance market and leave millions unable to afford care in the middle of a pandemic, even as the country waits for the Supreme Court’s decision in the case.

In total, if the ACA were repealed, more than 20 million Americans would lose their coverage, causing the biggest health insurance loss event in recorded history. Without coverage, people cannot get both the preventive and curative care they need. Rising uninsured rates during the COVID-19 pandemic would be particularly dire, as the uninsured may not only risk their own lives by avoiding treatment but also unwittingly spread the coronavirus without adequate and affordable care.

Struggling small businesses and the self-employed could be priced out of coverage

The ACA is a lifeline for employees of small business and the self-employed. Prior to the ACA, the majority of uninsured workers were self-employed or working at small businesses and had few affordable, comprehensive coverage options. Since the ACA was enacted, the uninsured rate for small-business employees has dropped by nearly 10 percentage points. Medicaid expansion increased the number of small-business employees enrolled in Medicaid by about 50 percent. Furthermore, small-business health care premiums have risen at the lowest rate in years, maintaining affordable options for small-business employees and the self-employed.

Now, during an economic crisis in which these small businesses and individuals have been desperately struggling to survive—and as a deadly pandemic spreads unabated—stripping marketplace coverage from millions of small-business employees risks further imperiling their physical and financial health. Without the ACA, countless small-business employees would become uninsured and unable to afford any coverage.

Young people under the age of 26 could lose access to their parents’ insurance during this period of mass unemployment

Repealing the ACA could have devastating consequences for young adults. Prior to the ACA, young adults were uninsured at a higher rate than any other age group. However, thanks to the ACA’s various coverage provisions, the young adult uninsured rate has been cut in half since 2010. One of the law’s most popular components allows young people to stay on a parent’s health plan until they are 26. This dependent coverage provision has helped millions of young people gain access to health insurance during a volatile age range when many are pursuing higher education; beginning their careers; or working in part-time or contract jobs that do not offer benefits. It has also helped young adults secure more comprehensive coverage than many were previously able to access through student health plans available prior to the ACA. The law made important strides in boosting the quality of these policies by requiring that they cover preexisting conditions; banning annual and lifetime limits; and providing preventive care at no out-of-pocket cost.

These coverage provisions are even more critical during the COVID-19 pandemic, as young people have experienced some of the greatest job losses, which puts their access to employer-sponsored health insurance at risk. Furthermore, reopening colleges and universities for in-person instruction has put young people at acute risk for contracting and spreading COVID-19, making the potential loss of young adult’s access to high-quality coverage an even greater cause for concern.

ACA repeal also threatens to eliminate EHBs that are crucial to young people’s well-being, including maternity care and mental health care. According to Young Invincibles, roughly 8 in 10 first-time mothers are between the ages of 18 and 34, and “mental health care is the number one reason young adults sought health care in 2013.” Census data confirm that mental health care needs have grown throughout the pandemic. As the most cash-strapped generation, young adults have limited disposable income to pay for these services out of pocket. If these services, among others, are no longer covered, it could pose significant challenges to young people’s physical, mental, and financial health.

Black, Native, and Latinx Americans who have been disproportionately harmed by COVID-19 would lose insurance in startling numbers

Communities of color—particularly Black, Latinx, and Native communities—have been disproportionately affected by the coronavirus pandemic, primarily due to current and intergenerational systemic racism that drives health disparities and differential access to care and many social determinants of health. Nearly 30 percent of workers of color have a condition putting them at risk of a severe illness from COVID-19, and these same communities are less able to withstand unexpected costs resulting from job loss or medical costs. In addition, Black, Latinx, and Native people are at least 2.5 times more likely to contract COVID-19; are at least 4.6 times more likely to be hospitalized; and die from COVID-19 at more than double the rate of white, non-Latinx people.

The same factors that drive health disparities for Black, Latinx, and Native communities also leave them disproportionately vulnerable to discrimination by insurance companies if ACA protections are taken away. Prior to the coronavirus pandemic, nearly 14 percent of African Americans, 10 percent of Hispanics, and more than 17 percent of American Indians and Alaska Natives reported having fair or poor health, compared with 8.3 percent of non-Hispanic whites. These preexisting conditions would already be used against Black, Latinx, and Native people by insurers to raise rates, and now the disproportionate rate at which these communities contract and have complications from the coronavirus would further subject them to price hikes and denial of coverage.

Insurers could again discriminate against women

Without the ACA, insurance companies would be allowed to charge women more just for being women—a practice common before the ACA. Notably, the ACA marked the first time that the prohibition against sex discrimination was applied to health care, and a return to this practice could again cost women $1 billion more annually than men. In addition, allowing insurers to once again discriminate against women by charging them more for coverage threatens to blunt women’s job prospects, as small businesses could opt to hire workers who are cheaper to insure. Alarmingly, such a trend would coincide with an economic crisis that has disproportionately driven women out of the workforce. Also, nearly 68 million women have a condition that could be deemed a preexisting condition, and even the nearly 6 million annual pregnancies would likely once again be considered a preexisting condition. Moreover, the elimination of other consumer protections, such as EHBs and the coverage of certain preventive care with no cost-sharing, could force millions of women to once again pay out of pocket for everything from mammograms to contraception to annual checkup appointments.

For the tens of millions who would become uninsured, sending children to school becomes not only a health risk but a bankruptcy risk

The failed coronavirus response has already left parents with countless impossible choices about their children’s well-being. While data on how COVID-19 has spread through schools that are reopened for in-person instruction are subject to uneven reporting, one independent analysis reports that there are more than 24,000 verified cases tied to K-12 schools. Parents’ fears about a child becoming infected or transmitting the coronavirus to a family or household member would only intensify in the case of ACA repeal. Of the 20 million newly uninsured Americans, millions are parents who would not only have to worry about health risks to their loved ones but also unknown or unaffordable medical costs. If families become uninsured and need intensive care or treatment, they could be on the hook for tens of thousands of dollars, leading to medical debt or even bankruptcy.

Drug costs for seniors would soar, and millions more would not be able to afford their prescriptions during a public health crisis

If the ACA is repealed, millions of Americans would pay more for their prescription drugs, including for lifesaving drugs that treat COVID-19 and conditions that place people at higher risk of the virus. First, the ACA lowered drug costs for seniors by closing the Medicare Part D coverage gap—also known as the “donut hole.” Prior to the ACA, seniors who reached a certain level of prescription drug spending faced a coverage gap, in which they had to pay the full cost of all prescription drugs, before the plan’s catastrophic coverage kicked in. Before the ACA closed the coverage gap, about 5 million Medicare enrollees fell into it. With nearly 9 in 10 older adults taking prescription drug medication—and 1 in 4 seniors already struggling to afford their medications—reopening the coverage gap would have devastating consequences.

In addition, the ACA includes prescription drugs in its list of EHBs. Before the ACA, individual market plans were not required to cover prescription drugs. Under the ACA’s EHB requirements, 1.3 million Americans gained prescription drug coverage. Without the ACA, insurers could exclude all drugs or entire classes of drugs, leaving some patients with high out-of-pocket costs and others unable to afford the treatments they need during the current public health crisis.

Many hard-hit states would be further devastated by the elimination of Medicaid expansion

More than 12 million Americans have gained coverage through the ACA’s Medicaid expansion, saving thousands of lives. Medicaid expansion narrowed racial gaps in coverage—which is particularly important as the pandemic continues to hit communities of color most harshly—and is critical for both preventive and curative care. States such as Ohio, Pennsylvania, Michigan, West Virginia, California, and Louisiana continue to battle the pandemic, each with hundreds of thousands enrolled in Medicaid expansion. The sudden elimination would be catastrophic for public health, likely preventing millions of newly uninsured people from accessing treatment, threatening their own well-being and compounding the spread of the virus. Furthermore, low-income families currently benefiting from Medicaid expansion would be at grave risk of financial catastrophe and more likely to take out debt in the event of a health emergency if they were to lose their coverage.

Due to systemic racism, sexism, and poverty, Black women and Latinas disproportionately rely upon the benefits the Medicaid program provides, including covering nearly half of all births in the United States. Eliminating this safety net is particularly concerning given Black women were already facing a maternal health crisis before the COVID-19 pandemic devastated their community. Additionally, ACA repeal would reverse the gains from Medicaid expansion on the employment of people with disabilities—which is typically abysmally low—and would harm a community that is already disproportionately poor. Finally, research shows that Medicaid expansion has also enhanced public safety by helping low-income working-age adults transition from incarceration, saving communities tens of billions of dollars.

Conclusion

Stripping coverage from more than 20 million Americans at any point in time would be terribly cruel, but to do so during a deadly pandemic would be catastrophic on individual, community, and national levels. During this economic crisis and public health emergency, the president should be following the guidance of public health experts and trying to increase access to affordable health care. Instead, he is pretending that the COVID-19 pandemic has passed and is rushing to fill Justice Ginsburg’s Supreme Court seat with an ideological justice willing to overturn the ACA. The Trump administration should use the energy and speed they are applying to this callous endeavor to slow the spread of the coronavirus and help all Americans gain health care coverage to protect them during this unprecedented time.

Nicole Rapfogel is a research assistant for Health Policy at the Center for American Progress. Maura Calsyn is the managing director of Health Policy at the Center. Colin Seeberger is a director of Media Relations at the Center.

To find the latest CAP resources on the coronavirus, visit our coronavirus resource page.