National

Open enrollment for Affordable Care Act coverage begins today, with enhanced subsidies that Congress renewed through 2025 expected to cushion the blow of premium increases for millions of Americans.

The big picture: Health costs are steadily climbing due to inflation and a post-pandemic surge of demand for medical services.

But the more than 12 million Americans now receiving subsidies will likely benefit from them again in 2023, including those making more than 400% of the federal poverty level.

The amount people pay in premiums will also be limited to 8.5% of their income.

And the Biden administration finalized rules to fix a glitch that had been preventing some families from getting subsidized health insurance.

Yes, but: For those who don't qualify for subsidies, premiums will increase more than in past years for marketplace plans.

"We're seeing a return to regular services," Chiquita Brooks-LaSure, administrator at the Centers for Medicare and Medicaid Services, told reporters on Monday.

Be smart: The cost pressures in the individual market are also being felt in the commercial sector, where health care costs are causing employers to grapple with higher premiums and tough decisions around benefits.

One mitigating factor is the absence of the so-called "family glitch," which kept people offered health insurance through their employer from accessing ACA marketplace subsidies to cover their families, even if they met eligibility requirements.

This fix could mean about 1 million families may benefit from marketplace coverage, Brooks-LaSure told reporters. An estimated 5 million people were affected by the glitch.

Even if families can enroll in marketplace plans, "the question is whether they will actually want to," Cynthia Cox, vice president at the Kaiser Family Foundation, told Axios.

By the numbers: In 2022, marketplace enrollment reached its highest level since 2015, with nearly 17 million people signed up.

This trend could continue, Cox said. And the anticipated end of the COVID-19 public health emergency could also mean some Medicaid enrollees who drop off program rolls and qualify for ACA plans.

ACA sign-ups begin with millions likely to duck big premium hikes

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Affordable Care Act

The U.S. faces a range of health care flashpoints — unaffordable drugs, opioids, vaping — as we debate whether to adopt universal care. For now, the Affordable Care Act is the law of the land, but Republicans want to issue it a final death blow.

Health

Black and Latino Americans saw surges in enrollment in the federal government's health care marketplace between 2020 and 2022, according to a new report released by the Department of Health and Human Services.

Why it matters: Black and Latino communities have historically had higher uninsured rates despite facing greater risks of worse health outcomes.

Details: The report, which analyzed race and ethnicity for HealthCare.gov enrollment data from 2015 to 2022, found that all racial groups other than multiracial people experienced boosts in enrollment between 2020 and 2022.

American Indian and Alaska Native enrollees saw a 32% increase.

Asian American, Native Hawaiian and Pacific Islander enrollees saw a 6% increase.

What they're saying: "[E]nrollment growth of Black and Latino populations exceeded all other groups during this time period and grew by nearly 40 percent for both groups between 2021 and 2022, building on more modest gains that occurred between 2020 and 2021," the report states.

"It's the combined effort of more outreach and more affordable coverage that has led to a game changer here in these communities," Ben Sommers, one of the lead researchers, told Axios.

When the Affordable Care Act was first implemented, data indicated that Black and Hispanic populations were not enrolling at high rates, in part due to historical distrust of the federal government, according to Nadereh Pourat, the associate director of the UCLA Center for Health Policy Research.

"Sustainability always is important," Pourat added. "So these lessons about what kind of approach works, how you talk to people, what messages you should give, who should give the message ... They should be embedded into [the federal government's] routine" to ensure all communities benefit.

The report's findings also highlight the continuing need for more comprehensive data collection on race and ethnicity — which remains incomplete and inconsistent — to better address health inequities. 

The big picture: ACA enrollment underwent a boost in recent years in part because of COVID-driven job losses.

Worth noting: Because enrollees are not required to report their race, researchers used validated imputation techniques for missing data, which involved inputting values for missing race and ethnicity information based on an Improved First Name Surname Geocoding method that was developed by the nonprofit global policy think tank RAND Corporation.

The report did specify that the method has high overall predictive accuracy but is less predictive for American Indian, Alaska Native and multiracial individuals. 

HHS reports significant increase in Black, Latino ACA health care enrollment since 2020

Black and Latino communities have historically had higher uninsured rates despite facing greater risks of worse health outcomes.

Photo of Xavier Becerra speaking from a podium with the HHS seal behind him

U.S. Secretary of Health and Human Services Xavier Becerra speaks during a news conference on June 28, 2022 in Washington, D.C. Photo: Alex Wong via Getty Images

President Biden has made the COVID-19 crisis and a post-Trump return to national unity and traditional democratic ideals his top priorities. From vaccinations to stimulus to schools, Biden is seeking bipartisan compromise while showing a willingness to use executive authority and bare Democratic majorities in the U.S. House and Senate to implement his policies. Republican leaders are navigating deep party divisions over if and how to move beyond former President Trump.

Politics & Policy

For the second election cycle in a row, a Republican-appointed federal judge in Texas has given Democrats an opening to campaign on saving the Affordable Care Act — an opportunity they relish.

Why it matters: Weaponizing the GOP's 2017 attempt to repeal and replace the ACA was hugely successful for Democrats in the 2018 midterms. Republicans have been eager to talk about anything but the ACA since then, but Judge Reed O'Connor has twice now issued decisions that put key tenets of the law at risk.

Driving the news: O'Connor yesterday ruled the federal government cannot require a Christian-owned company to cover HIV preventative medication because it violates their religious rights under federal law.

He also found that the ACA's requirement that insurers cover care recommended by the U.S. Preventive Services Task Force is unconstitutional, although he upheld the law's requirement about the recommendations of two other agencies.

"If today's ruling stands, colonoscopies, Pap smears, PrEP, and a broad range of preventive pregnancy-related services may no longer be covered w/o cost sharing," KFF's Alina Salganicoff tweeted.

Flashback: O'Connor is the same judge that sided with GOP state attorneys general in a case that argued the ACA is unconstitutional and should be struck down. 

The case went to the Supreme Court, which heard arguments in 2020 but ultimately upheld the law.

What they're saying: "This extreme MAGA ruling comes just months after the Republican-controlled Supreme Court discarded precedent and privacy in overturning Roe v. Wade," House Speaker Nancy Pelosi said in a statement hours after the decision was released.

"As extreme MAGA Republicans work to rip away life-saving drugs, Democrats are fiercely defending health freedom, protecting access to health care and lowering the cost of prescription drugs," she added.

Be smart: The Supreme Court's decision to overturn the federal right to abortion this summer arguably gave Democrats their most effective campaign message of the cycle, ahead of what was expected to be a red wave this fall.

If Pelosi's statement is any indication, the party will eagerly tie that decision to yesterday's and make November's election even more about health care. 

Between the lines: Democrats have been trying to make the case that Republicans support undoing popular health care policies — like their recently-passed prescription drug law that allows Medicare to negotiate directly with manufacturers — in addition to highlighting the party's support for abortion bans.

"Don't get it twisted: the GOP does have a health care agenda, and it includes cutting Social Security and Medicare and banning abortion with no exceptions for rape or incest," the DNC wrote in an email earlier this week.

But Democrats' case that the GOP will try again to repeal and replace the ACA or to repeal the drug law hasn't been particularly convincing, and has been based mostly on stray comments from not-particularly-relevant lawmakers. 

In reality, vulnerable Republicans have mostly been silent on health care.

What we're watching: O'Connor has yet to say how broadly the decision applies, and the preventive services requirements are still in place for now. He's asked both parties to submit proposals for the "scope of the relief," or the implementation of the decision.

And even if he ends up blocking the enforcement of those requirements, the decision will almost certainly get appealed. 

Democrats get another chance to campaign on health care

There's not much more that they'd rather do.

Illustration of a donkey with a gavel in its mouth

The Affordable Care Act is once again being challenged in federal court, this time with big implications for the private insurance market that dovetail with concerns about contraception access in the post-Roe world.

Why it matters: A pending federal case takes up whether part of the law requiring coverage of preventive services is unconstitutional. If the plaintiffs are successful, millions of people could lose access to free services like cancer screenings, immunizations and contraception.

Driving the news: The plaintiffs of Kelley v. Becerra and the federal government will each make their case this morning in a federal district court hearing before Judge Reed O'Connor.

If that name sounds familiar, it should. O'Connor is the same Texas judge who sided with the plaintiffs of the last major ACA court case, ruling that the law is unconstitutional and should be struck down.

That case ultimately went to the Supreme Court, where the justices last summer ruled 7-2 against the GOP plaintiffs.

What's at stake: The ACA requires most private insurers — not just those participating in the ACA marketplaces — to cover a set of preventive services without cost-sharing, a measure intended to get more enrollees to use them.

Specifically, the law outlines four categories of preventive care that must be covered, including recommendations and guidelines from the U.S. Preventive Services Task Force, the Advisory Committee on Immunization Practices and the Health Resources and Services Administration.

These recommendations include more than 100 services, per The Commonwealth Fund. 

What we're watching: If the plaintiffs ultimately win, the ACA's preventive services requirement would become voluntary, and insurers could either drop coverage of these services altogether or start charging enrollees for them. 

If O'Connor sides with the plaintiffs after today's hearing, a critical question will be whether the decision is effective immediately or put on hold during the appeal process. 

If O'Connor makes the ruling immediately effective and the 5th U.S. Circuit Court of Appeals or the Supreme Court doesn't put the decision on hold, there could be “draconian effects," Andrew Pincus, a visiting lecturer at Yale Law School, told reporters yesterday.

The case could ultimately follow the same trajectory as the last ACA lawsuit that O'Connor ruled on, and put the law's fate once again in the hands of SCOTUS.

Affordable Care Act lawsuit threatens contraception access

The case will be argued in a hearing today in federal court.

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Democrats' high-stakes math game

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Drug prices

Health care costs

Colorado is reviving an old progressive health care goal with a new twist, creating a public health insurance option that could be a model for other states trying to expand affordable coverage as they move past the pandemic.

Why it matters: Using flexibilities the Biden administration granted on Thursday, the state is trying to prove a government-run health plan can attract more consumers and save money while avoiding the political pitfalls associated with single-payer systems.

Driving the news: Colorado on Thursday became the first state to get a federal waiver to create a plan called the "Colorado Option" that will be offered on the state's Affordable Care Act exchange starting in 2023.

The plan would compete with private plans on the exchange with premiums that are on average 22.3% lower. 

That's projected to save the federal government $214 million in spending on premium tax credit subsidies next year.

Colorado would also expand a state subsidy program to lower costs for people who aren't eligible for ACA subsidies.

An estimated 32,000 residents could gain coverage through the option by 2027, when the waiver expires. 

The big picture: Washington state is the only state with a public option, but Nevada, Oregon and Connecticut are weighing whether to follow suit.

"We encourage all states to consider innovative ways to use section 1332 waivers in the future to expand and improve coverage and lower costs for their residents," CMS administrator Chiquita Brooks-LaSure said in a statement.

Yes, but: Washington's plan, which dates to 2019, has run into snags, including hospitals unwilling to voluntarily participate because of low payments and policies that tie reimbursements to Medicare rates. 

Private insurers have also balked at contracting with the state and participating in the plan, in part because hospitals were wary.

Washington officials are trying to fill coverage gaps in some underserved areas and set rates for next year to ensure every county in the state will have a public option plan.

Data from the Washington Health Benefit Exchange show that more Washington residents chose public option plans, called Cascade Care, in 2022 than in 2021.

In 2021, just 12% of people with plans on the exchange chose a Cascade Care plan, but in 2022, nearly a third of exchange plan customers chose a state-designed plan.

The intrigue: Colorado is trying to avoid some of the biggest problems that Washington encountered hit.

The biggest difference is insurers that offer ACA exchange plans in a county will also have to offer a Colorado Option for both individual and small-group coverage at the outset. 

"That means everyone essentially will have a Colorado Option which makes their presence more significant," Krutika Amin, associate director of the ACA program at the Kaiser Family Foundation, told Axios.

Colorado public options plans will also need to meet network adequacy requirements, to ensure there are enough providers.

Flashback: Centrist Democrats in Congress rejected putting a public option in the Affordable Care Act more than a decade ago.

The idea began to enjoy a revival before the pandemic, and Colorado Gov. Jared Polis signed legislation last year to set in motion his state's version of a government-run plan. 

President Biden touted a public option during his 2020 campaign, to build on the coverage gains of Obamacare.

What we're watching: The end of the COVID-19 public health emergency could alter prospects for state-based health plans, as thousands of people who have stayed on Medicaid plans throughout the pandemic might no longer qualify. 

It remains to be seen whether that population can find affordable coverage on state marketplaces.

States like Colorado are hoping to bridge that gap with subsidies for those at certain income levels who enroll in the Colorado Option.

The bottom line: Other states will be closely watching the experience in Colorado and Washington as the nation transitions away from the public health crisis and the uninsured population is expected to grow.

Colorado bets on a public option to grow health coverage

CMS approved Colorado's waiver to offer a 'Colorado option' state health plan, starting in 2023.

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Health insurance marketplaces

Vitals

Axios Vitals

Medications that prevent HIV — along with the necessary doctor's visits and lab tests — are supposed to be fully covered by most insurance plans under the Affordable Care Act.

Patients and advocacy groups tell Axios they're often not.

Why it matters: Studies show HIV pre-exposure prophylaxis, often called PrEP, is more than 90% effective in preventing the transmission of HIV.

But the brand-name version of the daily pill costs upward of $20,000 a year, and billing problems that shift costs to patients lead many who would benefit to opt out, advocates say.

 "You hear stories all the time," Jeffrey Crowley, director of the Infectious Diseases Initiative at the O’Neill Institute and a former director of the White House Office of National AIDS Policy, told Axios.

"They've been on PrEP and then all of a sudden, there's a new obstacle," he said. "They need to get prior authorization or they used to get their meds for 90 days and now they can only get them for 30 days. All of these hassle factors cause people to fall off."

Or as in the case of patients like Cambridge, Massachusetts resident Michael Brazile, they get fully covered PrEP treatments — along with a surprise bill for lab services required to obtain the drug.

A quick primer: The FDA in 2012 made Gilead's Truvada the first approved drug for HIV prevention in uninfected adults. There's now a generic version, plus another form of PrEP known as Descovy.

Since they are intended for those who are HIV-negative but at high risk of acquiring the virus, lab testing is a prerequisite, usually in person. 

In 2019, the U.S. Preventative Services Taskforce recommended PrEP as an effective method of preventing HIV, meaning health plans had to make it available at no cost to patients under the Affordable Care Act starting in January 2021. 

What's happening: Even so, patients are often hit with bills for the drug itself, for office visits, or lab work. 

Anthony Cantu, 31, who works in a health clinic in San Antonio where he counsels patients about PrEP, started the drug himself last summer. He got billed $374 for lab services connected with PrEP in October 2021 by Blue Cross Blue Shield of Texas. It was the first of several bills. 

After months of appeals and filing a complaint with the Texas Department of Insurance, his case was resolved. That is, until he recently got another bill for $187 for PrEP-related lab services. 

In a statement, the insurer said it "is committed to providing its members with equitable health care, including access to PrEP medication and clinical support related to PrEP," but did not specifically address concerns about instances where it wasn't covered

As Axios reported earlier this year,  Peter Sacco, 28, of Washington, D.C., was billed for copays for clinic visits and lab work associated with monitoring his health for a generic Truvada prescription and had difficulties appealing.

By the numbers: There isn't good data about how often this happens, Carl Schmid, executive director at HIV + Hepatitis Policy Institute, told Axios. 

But "I'm helping six people right now and we have to go to insurance commissioners every time?" Schmid said. "There really is a problem. With the ACA it's supposed to be seamless and that's not what's happening."

More federal enforcement and penalties for non-compliance are needed to make a meaningful change rather than state-by-state complaints, Schmid said. 

The other side: Insurers say the problem often is physicians aren't properly coding their visits as preventative, but when that happens it can be fixed on the backend, said AHIP Spokeswoman Kristine Grow.

Some plans are engaged in education campaigns with providers to appropriately submit claims, Grow said. And "health insurance providers are engaging with patients and their providers who have questions or concerns when they receive an unexpected bill and are working swiftly to address them," she said. 

Yes, but: "I am sympathetic to that. But once [insurers] know about that, it should get fixed. And it keeps happening," Katie Keith, a health law expert at Georgetown University who has written about this issue, told Axios.

"I'm much more deeply troubled by, even when you're telling your plan or your providers to tell your plan that this should be covered, that people are having to jump through such incredible hoops," she said. 

What to watch: An injectable form of PrEP was approved by the FDA, one of the multiple longer-lasting forms of the drug coming to market aimed at boosting compliance, Crowley said. It's unclear what will happen with coverage. 

HIV PrEP is supposed to be covered, but often isn't

HIV prevention still comes with unexpected costs

Illustration of a red AIDS awareness ribbon shaped like a "no" sign 

The formal end of the pandemic could swell the ranks of uninsured children by 6 million or more as temporary reforms to Medicaid are lifted.

Why it matters: Gaps in coverage could limit access to needed care and widen health disparities, by hitting lower-income families and children of color the hardest, experts say.

The big picture: A requirement that states keep Medicaid beneficiaries enrolled during the public health emergency in order to get more federal funding is credited with preventing a spike in uninsured adults and kids during the crisis.

Children are the biggest eligibility group in Medicaid, especially in the 12 states that haven’t expanded their Medicaid programs under the Affordable Care Act.

The lifting of the public health emergency, which was just extended to July 15, will lead states to determine whether their Medicaid enrollees are still eligible for coverage — a complicated process that could result in millions of Americans being removed from the program.

What they’re saying: The end of the continuous coverage guarantee puts as many as 6.7 million children at very high risk of losing coverage, per Georgetown University’s Center for Children and Families.

That would more than double the number of uninsured kids, which stood at 4.4 million in 2019.

"It is a stark, though we believe conservative, estimate," said Joan Alker, the center's executive director. "There are a lot of children on Medicaid."

Between the lines: Not all of the Medicaid enrollees who are removed from the program would become uninsured. But parents and their children could be headed down different paths if their household income has risen even slightly. 

Adults who've returned to work may be able to get insurance through their employer. Others could get coverage through the ACA marketplace, though it's unclear whether that would come the COVID-inspired extra financial assistance that's now being offered. 

Most kids would be headed for the Children's Health Insurance Program, Alker said — a prospect that can entail added red tape and the payment of premiums or an annual enrollment fee, depending on the state.

What we're watching: Changes in children's coverage could be most pronounced in Texas, Florida and Georgia — the biggest non-Medicaid expansion states, which have higher rates of uninsured children than the national average.

Congress could still require continuous Medicaid coverage, the way the House did when it passed the sweeping social policy package that stalled in the Senate over cost concerns.

CMS' Office of the Actuary projects a smaller decline in Medicaid enrollment than some health policy experts are predicting — and the Biden administration continues to move people deemed ineligible for Medicaid onto ACA plans, Raymond James analyst Chris Meekins noted in a recent report on the unwinding of the public health emergency. 

Pandemic's end could surge the number of uninsured kids

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Digital content

Percent change in the number of uninsured people if premium tax credits expire, 2023

Data: Urban Institute Health Insurance Policy Simulation Model 2022; Cartogram: Jacque Schrag/Axios

A disproportionate share of young adults, low-income, Black Americans and residents of Southern states will lose health coverage if Congress doesn't extend enhanced Affordable Care Act subsidies, according to a new analysis by the Robert Wood Johnson Foundation. 

Why it matters: The analysis estimates that 3.1 million Americans would become uninsured when the subsidies expire beginning next year, and millions more would face much higher premiums than they currently pay. But those effects wouldn't be felt evenly across the country.

The big picture: Democrats' coronavirus relief package last year made ACA subsidies more generous and expanded who was eligible for them, but only temporarily. 

Millions more people have entered the ACA marketplaces as a result. But Democrats' efforts to extend the subsidies have stalled in the Senate, along with the rest of President Biden's domestic agenda. 

Details: The uninsured population would increase most significantly among people with incomes of 138-400% of federal poverty absent congressional action, according to the analysis. 

When looking at race and ethnicity, Black Americans would see the largest change, followed by white Americans. Young adults ages 19-34 would be the most affected age group.

States that haven't expanded Medicaid, like Florida, Georgia and South Carolina, would see some of the highest increases in their uninsured populations.

Yes, but: Extending the larger subsidies would cost the federal government more than $25 billion in 2023 alone, and $305 billion over 10 years.

Between the lines: Being uninsured obviously has implications for people who then struggle to pay for health care when they need it. 

But it also creates financial problems for hospitals, which are required to treat patients having emergencies regardless of their ability to pay.  

What we're watching: Insurers calculate premiums months before open enrollment begins in November. 

That means that if the tax credits aren't extended in the first half of this year, insurers may not have time to adjust their premiums accordingly — meaning premiums would likely be inflated, the authors of the analysis argue.

That, in turn, could discourage marketplace enrollment and increase federal costs.

Go deeper: End of the pandemic could usher in spike of uninsured

Affordable Care Act subsidy cliff hits Southern states hardest

More than 3 million people will lose their insurance if enhanced ACA subsidies expire, per an analysis.

President Biden, joined by former President Obama, on Tuesday will announce regulatory changes to Affordable Care Act rules that could make health insurance more affordable for millions of Americans. 

Yes, but: The announcement comes amid significant doubt about whether Congress will be able to prevent millions of current ACA enrollees from seeing large premium hikes next year — or from losing their insurance altogether.

Driving the news: The administration is closing what's known as the "family glitch," which stems from part of the health law that deals with eligibility for premium subsidies and ultimately prices some families out of health insurance. 

Under current regulations, people who are eligible for "affordable" employer health insurance aren't eligible for premium assistance on the ACA marketplaces. 

The Obama administration defined affordability as the premium for a single beneficiary — the employee — being below a certain percentage of family income. That doesn't take into account the higher cost of adding dependents to family coverage.

The Biden administration is changing the definition and tying the eligibility threshold to the price of family coverage, which it says will lead to hundreds of thousands more Americans gaining coverage and more than a million spending less on premiums.

Biden will also sign an executive order today directing agencies to continue finding ways to make coverage more affordable. 

The other side: The policy is one of the largest regulatory changes to the ACA to date. But the biggest legislative change so far — the subsidy enhancement Congress passed last year — is set to expire at the end of this year, which would reverse progress made on coverage and premium costs.

HHS estimated last month that 3 million people will lose coverage if the policy expires, nearly 9 million would receive lower subsidies and 1.5 million would lose their subsidies entirely but remain insured.

What we're watching: Congressional Democrats still have time to revive the sweeping social policy legislation containing the bulk of Biden's domestic agenda, including an extension of the enhanced subsidies. 

Biden's Affordable Care Act lifeline

The administration is fixing the family glitch, but the ACA's enhanced subsidies are still at risk.

Affordable Care Act

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The Supreme Court could be Trump's ACA nightmare

The ACA is doing fine without a mandate penalty

The political risk of overturning the ACA

Trump's all-or-nothing ACA gamble

All Affordable Care Act stories