What does a challenge to the Affordable Care Act mean for Massachusetts?

A Supreme Court decision in a case challenging the Affordable Care Act could result in billions in lost federal funds and thousands more uninsured in Massachusetts, according to a new analysis by the Blue Cross Blue Shield of Massachusetts Foundation.

“It’s important for Massachusetts consumers to be aware of the potential effect of the court’s decision in this case,” said foundation President Audrey Shelto. “A final ruling that overturns the ACA would have widespread implications, affecting every state in the nation. Our analysis describes what’s at stake for Massachusetts if the court were to overturn the ACA — focusing on what it could mean for the state’s health insurance coverage rates and federal funding.”

In the case, known as California v. Texas, Republican attorneys general and governors in 18 states, including Texas, are seeking to strike down the ACA, while 17 other states, including California and Massachusetts, are seeking to preserve the 2010 federal law. The case is scheduled to be heard by the Supreme Court Nov. 10.

The ACA, passed in 2010, vastly expanded health care coverage in the U.S., ensured those with preexisting conditions could get coverage, expanded eligibility for Medicaid, closed the “doughnut hole” under Medicare’s drug benefit, mandated coverage of young adults up to age 26 under their parents’ insurance policies and coverage of preventive care with no patient cost-sharing, created subsidies for individual health insurance, and increased taxes to pay for its benefits.

Massachusetts’ own health reform law, passed in 2006, included many of the same protections that the ACA later brought to the rest of the country. However, the ACA still had a significant impact in Massachusetts by formalizing and increasing federal funding streams for the coverage expansions that were largely already in place in the Commonwealth, Shelto notes. If the ACA were overturned, it is unknown whether the state would be able to reestablish that funding and the programs they support.

In that case, the Blue Cross analysis estimates, 422,000 Massachusetts residents would lose health insurance coverage, more than doubling the number of uninsured people in the state with a rate that would climb from 4.4% to 12.0% of the under age 65 population.

If the ACA is struck down but the federal government reestablishes the funding that made the state’s 2006 coverage expansion possible, the state would see 69,000 people lose coverage, the analysis estimates. Federal health care funding for Massachusetts would shrink by $2.1 billion per year.

California v. Texas hinges on what is known as the “individual mandate,” a provision in the ACA that most people must maintain a minimum level of health insurance coverage and those who do not must pay a penalty to the IRS. In 2017, Congress lowered the penalty to zero. The challengers, backed by the Trump administration, contend the mandate is no longer constitutional because it no longer produces any revenue, and that the rest of the ACA must be struck down as well as a result. The law has remained in effect while the case has been pending. A decision is expected by the end of the court's term in June 2021.

The Blue Cross Blue Shield Association has filed a brief in support of the ACA in the case.

“Blue Cross and Blue Shield companies believe everyone should have access to health care, no matter who you are, where you live or what your health status may be,” said BCBSA’s President and CEO Scott P. Serota. “The U.S. Supreme Court should not invalidate the Affordable Care Act. To do so would strip vital protections from consumers no matter where they get their health insurance coverage – through an employer, Medicare and Medicaid, or the individual marketplaces that were created under the law. The ACA is particularly critical now for millions of the newly unemployed and their families, ensuring they still have access to quality and affordable health insurance coverage during a severe public health crisis.”

The Blue Cross Blue Shield of Massachusetts Foundation analysis was based on a model developed by the Urban Institute, using 2019 and 2020 cost and coverage data from MassHealth, the Health Connector, and the Center for Health Information and Analysis.

The foundation is an independently governed, nonprofit organization that supports the expansion of access to health care for low-income and vulnerable residents of Massachusetts through research, education, and grants to community organizations.

^{PHOTO OF AUDREY SHELTO BY MICHAEL GRIMMETT}