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2021 Individual Market Health Insurance Enrollment Periods
Updated Aug 18, 2021
This chart describes the regular and special enrollment periods when individuals may sign up for health insurance coverage through either the federal marketplace (healthcare.gov, which 36 states use) or state-operated marketplaces (used by 14 states and Washington, DC).
| Marketplace | Original 2021 Open Enrollment Period | 2021 COVID-19 Special Enrollment Period (SEP) |
| Federally facilitated marketplace (36 states) |
Nov. 1 – Dec. 15, 2020 | Feb. 15 – May 15, 2021* |
| State-Operated Marketplaces | ||
| California | Nov. 1, 2020 – Jan. 31, 2021 | Feb. 1 – May 15, 2021 and April 12- Dec. 31, 2021** |
| Colorado | Nov. 1, 2020 – Jan. 15, 2021 | Feb.8 – Aug. 15, 2021 |
| Connecticut | Nov. 1, 2020 – Jan. 15, 2021 | Feb. 15 – April 15, 2021 and May 1- Oct 31, 2021 |
| DC | Nov. 1, 2020 – Jan. 31, 2021 | Jan.1, 2021 – Jan. 31, 2022*** |
| Idaho | Nov. 1 – Dec. 31, 2020 | Mar. 1- April 30, 2021 |
| Maryland | Nov. 1 – Dec. 15, 2020 | Jan. 1 – Aug 15, 2021 |
| Massachusetts | Nov. 1, 2020 – July 23, 2021 | |
| Minnesota | Nov. 1 – Dec. 22, 2020 | Feb. 16 – July 16, 2021 |
| Nevada | Nov. 1, 2020 – Jan. 15, 2021 | Feb. 15 – August 15, 2021 |
| New Jersey | Nov. 1, 2020 – Jan. 31, 2021 | Feb. 1 – Nov. 30, 2021 |
| New York | Nov. 1, 2020 – December 31, 2021 | |
| Pennsylvania | Nov. 1, 2020 – Jan. 15, 2021 | Feb. 15 – Aug. 15, 2021 |
| Rhode Island | Nov. 1, 2020 – Jan. 23, 2021 | Feb.1 – Aug. 15, 2021 |
| Vermont | Nov. 1, 2020 – Dec. 15, 2020 | Feb. 16 –Oct. 1, 2021 |
| Washington State | Nov. 1, 2020 – Jan. 15, 2021 | Feb. 15 – Aug. 15, 2021 |
*Heathcare.gov opened a special enrollment period as a result of President Biden’s Jan. 28, 2021 executive order designed to strengthen Medicaid and the Affordable Care Act enrollment.
**California closed its COVID-19 SEP on May 15, 2021 and reopened a new, separate SEP in response to the American Rescue Plan Act on April 12, 2021.
***Washington, DC will extend its COVID-19 SEP through the last day of the DC Health Link Individual & Family 2022 Open Enrollment Period (January 31, 2022), unless the District of Columbia COVID-19 Public Health Emergency (PHE), as declared by the Mayor, is still in place on that date, in which case the SEP is available until the end of the month in which the PHE ends.
Congressional Proposals Could Improve Coverage Affordability and Access for Millions
Last week, Congress released a series of legislative proposals designed to respond to COVID-19’s ongoing public health and economic crises. The proposed legislation, expected to be voted on in early March, is a direct response to the Biden Administration’s American Rescue Plan and includes several provisions that could significantly impact eligibility and coverage sold through the health insurance marketplaces.
Tax Credit Increases for Purchasing Coverage through Marketplaces
The legislative proposals would institute a significant increase in tax credits available to consumers to help them pay for coverage sold through the health insurance marketplaces. Currently, premium tax credits (PTCs) are available to individuals and households who earn between 100 to 400 percent of the federal poverty level (FPL) and who purchase coverage through the health insurance marketplaces. (During 2021, individuals earning $12,880 to $51,520 or a family of four earning $26,500 to $106,000 a year would qualify for tax credits.)
Tax credits are allocated on a sliding, income-based scale so individuals and families are only required to pay 2 to 9.5 percent of their income for insurance (based on the cost of a second-lowest cost silver-level health plan available to that household).
The proposed changes increase the amount of PTCs available by both reducing the required contribution percentages to zero to 8.5 percent and by eliminating the 400 percent of FPL income cap, so that no household would be required to pay more than 8.5 percent of its income for coverage sold through a marketplace.
A recent report estimated similar changes could increase marketplace enrollment by more than 4 million individuals. The change would be retroactively applied, meaning individuals would be eligible for the additional subsidy amount retroactive to Jan. 1, 2021. These changes would be temporary, only applying to tax years 2021 and 2022. In addition, the proposal would create a new eligibility category whereby any individual receiving unemployment benefits in 2021 would be eligible for the maximum amount of PTC available. Specifically, the change would require that any income above 133 percernt of FPL be disregarded for the purposes of PTC calculation.
In a recent letter to Congressional leaders, 19 state-based marketplace (SBM) leaders agreed that policies that enhanced subsidies and removed the income cap would be some of the most effective tools to improve coverage affordability and access. However, significant work to make these changes will be required. Marketplaces must rapidly update eligibility and enrollment systems, modify consumer shopping tools such as cost calculators and websites, and conduct the education and outreach necessary to make consumers aware of the changes. The proposed legislation includes $20 million in grants to the SBMs to make the necessary IT changes.
Protections for Individuals who Misestimated 2020 Income
The Congressional proposals include a provision that would protect consumers from tax penalties related to receipt of an inaccurate amount of PTCs. PTCs are calculated based on an estimate of an individual’s expected income for the upcoming tax year. Typically, consumers who underestimate their incomes and receive more PTCs than they should have are subject to a financial penalty of up to $2,700 for incomes up to 400 percent of FPL. There is no penalty cap for individuals earning above 400 percent FPL.
The proposal recognizes the unprecedented unpredictability of many individuals’ income in during the pandemic and waives penalties for the 2020 tax year. Concerns about excessive penalties and income miscalculations in 2020 were raised by SBM leaders in a letter sent to the Treasury Department and Internal Revenue Services (read their letter here).
Congressional committees are currently finalizing legislative language and could vote as soon as early March. If passed, the federal government and the SBMs will need to work at a rapid pace to make the policy and system changes necessary for implementation. SBM officials are also making plans to adopt changes that will enable access to more affordable coverage for the populations they serve.
The National Academy for State Health Policy will continue to monitor and report on the proposed legislation as it moves through Congress and the SBMs as they begin the groundwork necessary to implement the proposals.
State-based Marketplace Strategies for Insurance Market Stabilization and Improvement Submitted to the Biden Transition Team
The National Academy for State Health Policy (NASHP), in consultation with state-based health insurance marketplaces leaders, has submitted a list of priority strategies to President-elect Biden’s transition team to improve marketplace operations.
These “action items” are designed to lower costs, stabilize individual and small group health insurance markets, improve access to coverage, and enhance the consumer’s experience when purchasing small group or individual market coverage.
NASHP is home to the State Health Exchange Leadership Network, a consortium of state leaders and staff dedicated to operation of the SBMs. These recommendations draw upon the experience of SBM leaders who have spent the past decade building and operating successful platforms for the procurement of health insurance coverage.
NASHP Outlines Priorities for the Biden Transition Team to Improve Health Insurance Markets
President-elect Biden has pledged to build on the Affordable Care Act (ACA) to provide more insurance choices, reduce costs, and make the health care system less complex and more accessible.
Since launching in 2013, more than a dozen state-based health insurance marketplaces (SBMs) have had the flexibility to develop efficient and cost-effective strategies to serve more than 4 million Americans.
Drawing on its years of experience working with SBMs, the National Academy for State Health Policy (NASHP) has developed a list of priority actions that the incoming Biden Administration could take to address its goals of providing high-value, affordable, and accessible coverage to Americans.
SBMs have become tested sources of innovation, leveraging a variety of strategies to more efficiently and effectively deliver coverage options to consumers through:
- Strategic and targeted marketing and outreach campaigns, and
- Development of tools, resources, and policies tailored to the needs of local consumers and insurance markets.
NASHP is sharing the SBMs’ lessons learned with the Biden transition team in an action item report. They are summarized below.
Immediate Actions to Address the COVID-19 Crisis
As COVID-19 surges across the country, Americans continue to reel from the impact of the pandemic, including income fluctuations, unemployment, and loss of once-secure benefits, including employer-sponsored insurance (ESI). At a time of continued financial uncertainty and when many individuals must navigate unfamiliar coverage options and eligibility processes, it is unreasonable to also impose roadblocks or penalties that hinder consumer’s ability to obtain or maintain needed coverage.
Flexibility from the Internal Revenue Services (IRS) to ensure that consumers are not unduly penalized during tax season because of inaccurate income reporting estimates could provide needed relief to families already experiencing financial hardship (read the NASHP blog, State-Based Marketplace Leaders Ask for Federal Reinforcement of Insurance Markets during COVID-19). Broadening special enrollment periods (SEP) to make it easier for individuals to enroll in coverage in the event of job or income loss could also ease the burden on individuals and families who lose ESI and need coverage. As evidenced by the hundreds of thousands of individuals who enrolled during SEPs in 2020, consumers are seeking open access to coverage and will need flexible enrollment channels as circumstances continue to fluctuate.
Simplifying and streamlining enrollment for qualified individuals:
While insurance subsidies, including advanced premium tax credits (APTC), are available to most individuals who earn between 100 to 400 percent of the federal poverty level (FPL), many are not able or are reluctant to access these benefits because of barriers that hinder access due to confusing eligibility and enrollment rules, often perpetuated by complex federal policies. These policies feature discrepancies between how eligibility is determined for various federal programs, including APTCs and Medicaid, as well as policies that deter qualified legal immigrants from enrolling in programs, such as the public charge rule. Additionally, complications in assessing the affordability of employer coverage — either for families that fall into the family glitch or those that are interested in exploring the use of health reimbursement arrangements (HRAs) — limit the ability of both employers and families to fully explore coverage options that can or should be available to them. Simplifying or rescinding policies that add to enrollment complexities will ensure that more individuals accurately receive the benefits that they qualify for.
Initiatives to prevent market segmentation:
Health insurance markets function most efficiently when they have a robust pool of enrollees across which to balance costs and risk. To generate this mix, the ACA consolidated the market, requiring all individual market plans to be sold in one risk pool (similarly, small group coverage must also operate using a single risk pool). However, recent actions taken by the Trump Administration have enabled the proliferation of alternative forms of coverage, including short-term, limited-duration, and association health plans, and health care sharing ministries. These alternatives are usually not required to meet the same rules as traditional insurance, including guaranteed coverage of certain benefits or protections for those with pre-existing conditions, nor are they required to participate in the single insurance risk pool. Yet, they do compete with insurance products, drawing individuals (often young and healthy) out of the insurance risk pool.
This latter competition may be exacerbated by the growth of direct enrollment entities – third-party enrollment entities that may opt to direct consumers to coverage alternatives. Issues may also arise from the federal government’s recent reinterpretation of the “guardrails” governing Section 1332 state innovation waivers, which opened the opportunities for waivers that allow for coverage alternatives.
Limiting the avenues by which these unregulated products can cut into or harm insurance markets will support the development of healthier, balanced markets and thereby lower costs to consumers.
Restoring and enhancing equal access to coverage and services:
Policies set in place under the ACA sought to ensure equal access to coverage and health services regardless of health status or other traits commonly used to discriminate against consumers, including race, sex, age, or national origin. Recent federal actions rolled back some of those protections, including actions that rescinded protections against discrimination based on gender identity and sexual orientation, as well as steps to improve language accessibility. Other actions reduced protections for consumers by providing an avenue for insurers to deny new enrollments in the case of enrollees who owe outstanding premium payments.
Individuals are given only limited windows in which to enroll in coverage, and barriers that prohibit them from enrolling during that time restrict their access to critical coverage. This is especially troublesome at a time when financial hardships from COVID-19 may have caused delays in timely premium payments. To enable access to coverage and better protections for consumers, it is important to reinstate or enhance consumer protections that improve access and safeguard against discriminatory practices.
Preserving market stability:
Above all, markets require consistency, otherwise insurers act to compensate for both real and perceived changes to their markets, especially ones that are expected to reduce enrollment or drive up costs. A drastic example of this was seen in 2017 when the federal government ceased payments to issuers to support to the cost-sharing reduction (CSR) program, followed closely by Congressional repeal of the individual mandate penalty. Premiums inflated, as insurers sought to offset predicted losses. Several states intervened, instituting policies to mitigate the effect of CSR losses, and in some cases passing their own individual mandates. To maintain market stability and avoid premium spikes, future policies (e.g., changes to the CSR program, premium adjustments, actuarial value calculators, or the poverty threshold) must be designed to minimize market impacts if they are enacted.
While many of these actions relate to reinforcement of federal requirements to ensure access to and stability of insurance markets, states will undoubtedly continue to lead as innovators and regulators of their markets. States will need the maximum flexibility available to them to continue to experiment and make changes to their markets to accommodate the evolving needs of their consumers and insurance markets. This includes continued flexibility over SBM operational functions, like open enrollment windows, as well as broader opportunities to innovate, like flexibility available through Section 1332 state innovation waivers (as conceived prior to the recent reinterpretation of the waiver guardrails). As new federal leadership emerges, NASHP will continue to monitor the actions of states and the federal government as both work to build better, stronger, health care systems.
While the Supreme Court Appears Likely to Uphold the Affordable Care Act, States Still Face Uncertainty
Last week, the US Supreme Court heard oral arguments in the case of California v. Texas about the constitutionality of the Affordable Care Act’s (ACA) individual mandate to purchase health insurance coverage, which some states are challenging because Congress eliminated the tax penalty associated with the mandate.
Based on the justices’ questions during oral arguments, many legal analysts consider it unlikely that the entirety of the ACA will be struck down. However, exactly how the Supreme Court will rule cannot be predicted — as evidenced by the court’s 2012 decision in NFIB v. Sebelius that made the ACA’s Medicaid expansion a state option. With a decision not expected until spring 2021, states must operate their health programs under a veil of uncertainty in the coming months and be prepared for a range of possible rulings.
Background
Spearheaded by Texas, 18 Republican-led states and two individuals are challenging the ACA’s constitutionality, and the Trump Administration’s Department of Justice (DOJ) is also supporting the challenge. Their main argument centers on a change that was made through the 2017 enactment of the Tax Cuts and Jobs Act (TCJA), which included a provision to reduce the ACA’s individual mandate penalty to zero dollars. They contend that because the 2012 Supreme Court case NFIB v. Sebelius upheld the constitutionality of the ACA based on Congress’ taxing power, now that there is no revenue associated with the mandate penalty, it can no longer be considered a tax and consequently the individual mandate is unconstitutional. The plaintiffs also argue that because the individual mandate is so crucial to the ACA, the entire law should be ruled unconstitutional.
Defending the ACA is a group of Democratic attorneys general from 21 states and the Democratic-led US House of Representatives.
- For a detailed report on the background and evolution of the case, read the Kaiser Family Foundation’s report, Explaining California v. Texas: A Guide to the Case Challenging the ACA.
- For information about the potential implications for state health policy if the entire ACA is struck down, read this National Academy for State Health Policy (NASHP) blog, You Can’t Unring a Bell – Implications for States if the Supreme Court Upends the Affordable Care Act and view/download this slide deck, A Review of the ACA’s Key Provisions and the Potential Implications of the Supreme Court’s Overturning the Law.
Key Questions before the Supreme Court
- The court must first determine if at least one state or individual plaintiff has standing to bring the lawsuit.
- If they do, then the court will decide whether or not the individual mandate is constitutional — and if the justices decide it is, then the ACA will stand.
- If a majority of the court rules that the individual mandate is unconstitutional, then its next decision relates to severability.
- The court will decide whether the individual mandate can be severed, leaving the rest of the ACA in effect without the mandate.
- Or, if a majority of justices decide it cannot be severed, then they will determine whether only parts of the law or all of it must be struck down. (It also is possible that the Supreme Court could send the issue of severability back to the lower courts to determine.)
Key Points from Oral Arguments
Do plaintiffs have standing? A number of the justices’ inquiries focused on the question of standing — specifically whether the challengers have a legal right to sue because the mandate as it exists now causes substantial harm to them. The challengers’ argument is that the 18 states have standing because of increased costs associated with the mandate, such as when more individuals enroll in Medicaid to comply with it and the administrative costs of filing paperwork needed to meet the ACA’s reporting requirements. The two individual plaintiffs contend they have standing because they believe they are obligated to purchase health coverage due to the mandate and incurred costs in doing so.
As noted in SCOTUSBlog’s analysis of the oral arguments, the justices appeared somewhat divided on the issue of the challengers’ claim of standing, and their discussion centered on the Trump Administration’s additional argument that the plaintiffs have standing because they are injured by other parts of the ACA that are directly connected to the mandate. As noted by Justice Elena Kagan, given that Congress often passes legislative packages that cover many different issues, it would be significant “…if you can point to injury with respect to one provision and you can concoct some kind of inseverability argument, then it allows you to challenge anything else in the statute.”
Speaking on behalf of the states defending the ACA, California Solicitor General Michael Mongan argued that the two individual plaintiffs lack standing because, without an enforcement mechanism, the mandate no longer compels them to purchase insurance. Regarding whether the 18 state challengers’ have standing, Mongan argued they have not demonstrated that they have faced greater costs due to the mandate.
Is the individual mandate constitutional? The state challengers’ main argument is that because the Supreme Court’s 2012 decision centered on whether the mandate was a valid exercise of Congress’ taxing power, with the mandate no longer generating federal revenue, it is now unconstitutional. Also, the challengers argued that the specific language used in the text of the mandate obligates individuals to purchase coverage, despite the fact there is no longer a penalty for not buying health insurance.
In contrast, the ACA’s defenders argued that the mandate is not a command to purchase health coverage, and that because Congress removed the financial penalty associated with the individual mandate, it is “toothless” and effectively inoperative. Mongan noted that Congress has “routinely created inoperative provisions … And they haven’t been viewed as constitutionally problematic because they don’t alter legal rights or responsibilities or bind anyone.”
Justice Kagan cited the court’s 2012 ruling that the mandate was constitutional, and that with the TCJA’s removal of the mandate’s financial penalty, “…Congress has made the law less coercive…” She added that because of this, it does not seem valid to now deem the mandate unconstitutional.
Is the individual mandate severable from the ACA? The challengers argued that even though there is no enforceable penalty now, the text of the ACA indicates that the individual mandate is inextricably tied to its functioning. Some of the justices appeared to agree with this assessment, noting that in the 2012 case, the ACA’s defenders contended that the mandate was essential for ensuring successful operation of the ACA.
In response, the ACA’s defenders highlighted the ACA’s carrot-and-stick approach — noting that even though the financial penalty (the stick) has been nonexistent since 2019, enrollment in the health insurance marketplaces has remained relatively stable, most likely due to the “carrots” (the marketplace subsidies and insurance protections) emerging as more effective than originally anticipated. Additionally, they noted that the Congressional Budget Office (CBO) determined in 2017 that the ACA’s insurance markets would continue to function the same regardless of whether Congress chose to reduce the penalty amount to zero or fully eliminate the mandate provision.
Noteworthy because of their potential to side with the court’s three liberal-leaning justices, Chief Justice John Roberts and Justice Brett Kavanaugh appeared to question the argument by the challengers that the elimination of the mandate penalty effectively invalidates all of the ACA. They emphasized that it did not seem that Congress intended the entire ACA to fall when it zeroed out the mandate penalty under the TCJA considering it chose not to repeal the full law at that time. Justice Kavanaugh also commented that the court’s prior decisions related to severability could serve as an argument for not striking down the entire ACA if the mandate is found to be unconstitutional, saying, “I tend to agree with you that it’s a very straightforward case for severability under our precedents, meaning that we would excise the mandate and leave the rest of the act in place…”
Next Steps
A decision may not come until the end of the court’s term in June 2021 and there are a range of potential outcomes. However, as a Health Affairs analysis of the oral arguments pointed out, it appears likely that if even if the court decides the individual mandate is unconstitutional, many of the justices’ comments related to the severability of the mandate appear to indicate that the court could decide to keep the rest of the ACA in place.
As states await the outcome, state-based marketplaces and Medicaid programs are focusing on enrolling individuals in coverage, while also continuing to respond to the challenge of increasing COVID-19 cases and preparing for the distribution of an eventual COVID-19 vaccine. The incoming Biden Administration will need to be poised to work with states to respond to the implications of the court’s ruling if parts or all of the ACA are struck down.
The Biden Health Plan and States: Opportunities for Collaboration
As he launched his Covid-19 Task Force this week, President-elect Joe Biden moved quickly to turn his health care campaign promises into policies in preparation for entering the Oval Office in January. In addition to ending the pandemic, Biden plans to build on the Affordable Care Act (ACA) by expanding access to and affordability of insurance coverage, creating a public option, and lowering Medicare eligibility to age 60.
Biden also proposes to lower drug costs, end surprise medical billing, address long-term services, expand mental health services, increase funding to community health centers and state Medicaid programs, address maternal mortality and its impact on Black women, improve rural health care, work with providers to improve health outcomes and quality, and protect consumers against price increases resulting from provider consolidation. But his ambitious agenda will likely face some stiff headwinds.
First, the Supreme Court today began hearing oral arguments in Texas vs. California, which may lead to the overturning of all or portions of the ACA. While many court observers doubt the entire law will be scuttled, the future of the ACA will not be certain until the Supreme Court rules, which could come as late as June 2021. The court’s 2012 decision in NFIB vs. Sebelius is a reminder of the challenges of trying to predict how the court will rule. In that decision, the court upheld the constitutionality of the ACA but surprised the health policy community by nullifying the law’s mandate for Medicaid expansion, making that decision a state option. The uncertainty about the court’s action on the current ACA case will weigh on the Biden Administration, which must be ready for whatever results.
Many of Biden’s proposals require Congressional action and budget approval in a particularly challenging economic and political environment. Should Republicans maintain their Senate majority following the two Senate run-off elections in Georgia, the Biden Administration can expect resistance to many of its proposals. While the President-elect and new Congress will undoubtedly work to address the nation’s first priority of curbing the ongoing pandemic and in so doing so jumpstarting the economy, the new Administration is expected to fight as hard for health care reforms that Biden promoted on the campaign trail.
As the debates unfold and Congressional roadblocks arise, states will have new opportunities to advance health care reforms and innovations – giving the new Administration a temporary safe harbor from the headwinds of Congressional opposition. The Biden Administration can, through regulatory reforms, Medicaid and 1332 state innovation waivers, and discretionary funding, enable states to implement some of his proposals and invest in other innovative health policies and programs as states continue to serve as the nation’s laboratories of innovation
Access to Affordable Coverage
State and federal marketplaces: Biden proposes to strengthen the ACA by:
- Eliminating the “cliff” that makes individuals with incomes exceeding 400 percent of the federal poverty level (FPL) ineligible for advanced premium tax credits (APTC);
- Limiting what people spend on health insurance to 8.5 percent of their incomes; and
- Making the benefit plan richer, basing APTC tax credits on gold plans instead of less robust silver plans.
The Biden Administration may provide greater funding for outreach and extend open enrollment and special enrollment periods – now offered by only state-based marketplaces – throughout the federal marketplace (healthcare.gov).
Medicaid enrollment: The federal Public Health Emergency, now set to expire Jan. 20, 2021, is expected to be extended, and with it the mandate enabling states to maintain their current Medicaid enrollment. Biden may use the Public Health Emergency’s authority to temporarily increase APTCs, though that raises questions about the impact on consumers and carriers when the emergency ends. Biden is also expected to seek to help state and local governments by increasing federal funding for Medicaid.
Complementary state strategies: Prior to the pandemic, several states had increased insurance premium subsidies available to consumers, but current revenue shortfalls make that unlikely in most states in the near future. However, the federal government can move quickly to overturn regulations and other guidance that has impeded state-based marketplaces and new coverage initiatives. In the next week, the National Academy for State Health Policy (NASHP) will release a comprehensive document, developed with input from state-based marketplaces, that outlines regulatory fixes that the Biden Administration could implement, including:
- Immediate changes that would protect consumers from Internal Revenue Service penalties during the pandemic and restore anti-discrimination protections;
- Remove enrollment disincentives for legal immigrants;
- Eliminate the double-billing requirement for non-Hyde abortions;
- Protect the integrity of the individual insurance market; and
- Rescind 2018 federal guidance on 1332 waivers to ensure that all coverage available through the waivers is as comprehensive and affordable as the ACA’s.
Public option: Biden proposes a federal public option, offered through the health insurance marketplaces, that would have the purchasing power to ensure affordable prices and be available to the individual market and employees for whom employer coverage is too costly. The public option would auto-enroll individuals with incomes up to 138 percent of the FPL. States that have expanded Medicaid would have the option of moving individuals into a premium-free public option plan or keeping them in Medicaid.
Complementary state strategies: Washington State has enacted a public option, which is offered on its exchange, that is currently being phased in. New Mexico and Colorado have attempted the same. At issue is how to make sure the plans provide a competitive pricing advantage. NASHP has developed a hospital cost tool to help state officials easily evaluate hospital finances. The tool also provides information to inform discussions about how to set hospital prices as a percent of Medicare under a public option. The Biden Administration has broad authority to use funding through the Center for Medicare & Medicaid Innovation to advance public options and approve 1332 or Medicaid waivers that could support different models, including a Medicaid buy-in initiative.
Impact on Prescription Drug Pricing
Negotiate Medicare drug prices: The Biden plan seeks legislative authorization to use Medicare’s purchasing power to negotiate drug pricing using a model similar to Germany’s, in which insurers and manufacturers negotiate ceiling prices based on comparative effectiveness research or else face binding arbitration.
Limit launch prices for drugs without competition or that are abusively priced. An independent review would determine the value of specialty, high-cost drugs and recommend a price similar to those found in other countries. Medicare, private plans operating in the marketplace, including the public option, would have access to these prices
Limit price increases for bio-similars and generics to medical care inflation rates. Manufacturers would need to adhere to the limits or pay a tax penalty.
Support drug importation from Canada. President-elect Biden supported state initiatives to import drugs. Currently, six states (VT, FL, CO, ME, NM, and NH) have enacted importation laws.
Complementary state strategies: Recently issued federal rules authorizing importation require some revision to support state implementation efforts. Also, states would benefit from federal assistance in communicating with the Canadian government.
NASHP has developed model state laws that mirror the Biden proposals. One uses international pricing to set a ceiling that applies to what commercial payers in a state would pay for certain high-cost drugs and has already been introduced in Pennsylvania. Other states are expected to follow. Should the Biden Administration succeed in pegging Medicare rates to international prices, states could benchmark to those rates.
Another NASHP model law uses the Institute of Clinical Effectiveness Research’s (ICER) list of unsupported drug price increases and establishes tax penalties for manufacturers whose drug prices are not supported by clinical evidence, according to ICER. A third model law gives authority to state attorneys general to take legal action in cases of generic drug price gouging. All three state model laws have been developed with legal guidance but would benefit from collaboration with the US Department of Justice and other federal agencies.
These Biden proposals would significantly expand access to affordable coverage and curb drug prices, but they are expected to face strong headwinds as the new Administration works to manage the pandemic, awaits the Supreme Court’s decision on the future of the ACA, and confronts a possible Senate majority that could oppose much of the Biden agenda.
State actions alone cannot replace nationwide, consistent policy as proposed by the President-elect, but their initiatives and innovations can begin to plant the seeds should the Administration be unable to immediately overcome political and stakeholder opposition, and state efforts can help build momentum for future federal reforms.
Implications for States if SCOTUS Overturns or Upends the ACA
The Supreme Court decision in the California vs. Texas case challenging the Affordable Care Act (ACA) could impact all or just a few of its policies and programs with far-reaching consequences for states. This NASHP slide deck describes the ACA’s major provisions, state implementation of the act, and potential implications if the ACA is overturned or revised. Read a related blog, You Can’t Unring a Bell – Implications for States if the Supreme Court Upends the Affordable Care Act, and read/download the slide deck.
You Can’t Unring a Bell – Implications for States if the Supreme Court Upends the Affordable Care Act
For more than a decade, states have been at work implementing the Affordable Care Act (ACA). Today, to varying degrees, its provisions are hardwired into all states. If the ACA fails to survive the objections raised in the US Supreme Court case California vs. Texas, states will face significant challenges and new costs.
Next week’s oral arguments before the nation’s highest court could lead to a decision to end the ACA, depending on how broadly the court rules, and create significant disruptions in states.
The court may reaffirm its 2012 ruling that upheld the constitutionality of the mandate that individuals must have insurance coverage or pay a penalty. It could also conclude that the individual mandate is in fact unconstitutional and strike down some but not all the law, or it could end the law altogether. Of course, the most profound impact such a decision would have is on the more than 20 million Americans now covered through ACA’s coverage expansions. Most states, now confronting severe budget constraints due to COVID-19, would be unable to replace the federal dollars that now support that coverage through Medicaid expansion and tax subsidies.
But there are more implications – some mundane but substantial – at stake here for states should the court significantly alter or eliminate the ACA. This blog and the accompanying slide deck outlines the far-reaching effect of states’ health insurance programs stripped of the ACA.
For starters, the ACA required states to significantly alter how Medicaid eligibility and enrollment is conducted and changed how financial eligibility is determined for many Medicaid enrollees. It required a single application to be used for multiple health coverage programs and streamlined how eligibility is conducted. Federal dollars supported the buildout of new technologies and other administrative apparatus to support the new, consolidated eligibility and enrollment systems and to link Medicaid to health insurance exchanges. This work was transformative and is now well established in all states, but without the ACA:
- Would states be required to again retool all their systems and do it without the federal money that helped build them?
- Would states face federal penalties for noncompliant eligibility determinations as they transitioned Medicaid expansion enrollees off coverage and revamped their systems to once again administer traditional Medicaid programs?
- What about the cost and ensuing confusion as children of state employees, now eligible for the Children’s Health Insurance Program (CHIP) and ACA funding, lose that coverage and revert back to their parents’ health coverage?
If the ACA’s expanded coverage to fill the Medicare Part D’s “donut hole” is eliminated, how will states protect low-income Medicare beneficiaries who are dually eligible for Medicare and Medicaid, and at what cost?
Importantly, the ACA set national standards for insurance regulation, particularly for small group and individual markets. Before the ACA, insurers used crude tools to lower costs and maximize revenue, imposing annual and lifetime limits on claims, refusing to cover pre-existing conditions, using discriminatory rating practices, denying renewals, and rescinding coverage while shifting more and more costs to out-of-pocket expenses for consumers. The ACA prohibited such practices and imposed medical loss ratios on all markets to limit what insurers could charge in overhead and administration.
In providing advanced premium tax credits (APTC) and health insurance exchanges to help consumers find and secure affordable, comprehensive coverage, the ACA stabilized and grew the individual markets in states. The loss of these consumer protections and subsidies will alter the dynamic of these markets and challenge states to maintain coverage. While 40 states have enacted laws to allow children to stay on a parent’s plan until age 26, some make that coverage optional for insurers, not a requirement. As the chart in this slide deck demonstrates, some states have concretized parts of the ACA in their state laws, protecting those with pre-existing conditions, limiting out of pocket exposure, and banning annual and lifetime benefits. But the majority of states have not followed suit and the loss of APTCs that make that coverage affordable will complicate state policymaking decisions.
These few examples of the data included in NASHP’s slide deck make clear that the ACA is deeply embedded in state program operations, policy and law. The elimination of the ACA would indeed create profound loss for the millions of people covered by the program, but the disruption it would cause states’ insurance markets and administrative and IT infrastructure cannot be ignored. As the court hears oral arguments and ultimately makes its decision, states must be prepared for potential upheaval as 11 years of work implementing and refining the ACA could be upended.
For individuals living with complex, often chronic conditions, and their families, palliative care can provide relief from symptoms, improve satisfaction and outcomes, and help address critical mental and spiritual needs during difficult times. Now more than ever, there is growing recognition of the importance of palliative care services for individuals with serious illness, such as advance care planning, pain and symptom management, care coordination, and team-based, multi-disciplinary support. These services can help patients and families cope with the symptoms and stressors of disease, better anticipate and avoid crises, and reduce unnecessary and/or unwanted care. While this model is grounded in evidence that demonstrates improved quality of life, better outcomes, and reduced cost for patients, only a fraction of individuals who could benefit from palliative care receive it. 
