California has wholeheartedly embraced the Affordable Care Act — it advertises it, it invests in it, it protects it.
It even goes to court for it.
That’s because the Golden State has a lot to lose if the the act, also known as Obamacare, is overturned.
Today, the high court will hear oral arguments in California v. Texas, a lawsuit that is challenging the health law’s constitutionality. California Attorney General Xavier Becerra is leading the defense of the act, with a decision expected next spring.
“The ACA has withstood numerous legal and political challenges,” Becerra said on Monday. “It’s been upheld by the Supreme Court as constitutional twice before. And we are optimistic that it will withstand this challenge as well.”
While not all states embraced the law, California implemented it fully— and built on it.
So how much exactly does the state stand to lose? And what is California’s plan if the law is terminated with no replacement? Here’s what you need to know.
What’s in it for California?
The Affordable Care Act was signed into law in March 2010 and was fully implemented in 2014. The law did several things, among them:
Prohibited insurance companies from denying coverage to people with preexisting conditions
Required that insurers cover young adults on their parents’ plans up to age 26
Eliminated annual and lifetime limits on coverage
The law also allowed states to choose whether to expand their Medicaid programs for low-income people, meaning more could qualify. And notably, the act created state-based marketplaces, such as Covered California, where people shop and enroll in health insurance. Through these marketplaces people can access federal subsidies that help keep their premium costs down. In California, enrollees may also qualify for state-based aid.
Eliminating the Affordable Care Act without any replacement from Congress would cause more than 5 million people in California to lose their subsidized insurance or their Medicaid coverage (Medi-Cal in this state) through the program’s expansion, which some state officials have called a disaster during a pandemic.
California’s rate of people without insurance dropped from 17.2% in 2013 to 7.7% in 2019. By comparison, Texas, which wants to eliminate the law, continues to have the nation’s highest percentage of uninsured residents. Its uninsured rate dropped from 22.1% in 2013 to 18.4% in 2019.
California v. Texas, brought by 18 Republican attorneys general and backed by the Trump administration, questions the validity of the act’s individual mandate, which requires most citizens and legal residents to have health insurance or pay a penalty. The mandate was intended to get young, healthy people to sign up and offset the cost of sicker people.
Critics have contended that requiring coverage is unfair, and that a tax penalty is a burden to families. The mandate has been the most unpopular part of the law, according to polls.
In its 2017 tax bill, Congress eliminated the tax penalty associated with not having insurance (California later implemented its own penalty.) The Republican attorneys general argue that with no fine, the federal mandate is invalid— and therefore, so is the entire law.
Today’s hearing comes two weeks after the Senate confirmed a new U.S. Supreme Court justice — and just days after a contentious presidential election. Democratic lawmakers unsuccessfully pushed back on replacing the late Justice Ruth Bader Ginsburg with now Justice Amy Coney Barrett, arguing that a more conservative court would likely lean against the law.
And a Joe Biden presidency won’t make a difference in the court case, said Gerald Kominski, a senior fellow at the UCLA Center for Health Policy Research. “But if the court keeps the law intact, one of Biden’s platforms was expanding the ACA, or what we call ACA 2.0, so he’d try to take it even further.”
As medical experts continue to learn about the lingering health effects of COVID-19, policy experts are raising another concern — that insurers could classify coronavirus as a preexisting condition.
“We think of cancer, diabetes, heart disease — but pregnancy was also a preexisting condition,” Deborah Kelch, a health care consultant, said during a recent legislative hearing. “And of course, as we are looking at it, COVID eventually will be a preexisting condition.”
That means that if Obamacare’s protections for people with preexisting conditions were to go away, hundreds of thousands of Californians who have tested positive for the virus could potentially find themselves with pricier coverage — or none at all. (There are no preexisting condition limits for people on Medicare, which primarily covers people 65 and over.)
Researchers at the Commonwealth Fund estimate that nationally, about 3.9 million adults under age 59 have had COVID-19 and had no prior condition. COVID-19 has been linked to damage of the lungs, heart and other organs. The uncertainty of how vast these effects could be is enough for insurers to want to label coronavirus as a preexisting condition, the Commonwealth researchers say.
