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OP-ED: The Supreme Court could kill protection for preexisting conditions. You should be terrified

Michael Hiltzik
Los Angeles Times (TNS)
Supporters of the Affordable Care Act rally at the U.S. Supreme Court on June 25, 2015, in Washington, D.C. (Bill Putnam/Zuma Press/TNS)

President Donald Trump is putting out the word that he has a plan to protect Americans with preexisting medical conditions from losing their health coverage, especially if the Supreme Court invalidates the Affordable Care Act.

It’s possible that Trump will pull a rabbit out of his hat and produce something via executive order that would achieve that goal.

But the truth is that there’s virtually nothing he can do by executive order to accomplish what he says he wants. It would take legislation, and the record of Trump’s promises on health care, and those of Republicans on Capitol Hill who have made the same promises over the years, suggests that the smart way to bet is that this is a lie. Trump is gaslighting the public.

The GOP’s past proposals invariably would have turned the clock on preexisting condition protections back to the Stone Age — that is, the period before the ACA’s enactment in 2010. More on that in a moment.

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The urgency of the goal has increased with the passing of Supreme Court Justice Ruth Bader Ginsburg, who was always a rock-solid vote to preserve the ACA. Almost certainly, Trump will nominate a new justice hostile to the health care reform law.

That’s important, because the court has scheduled oral arguments Nov. 10 on a lawsuit brought by Texas and other red states seeking to invalidate the ACA in its entirety.

Legal scholars consider the grounds of the case to be absurd, but if a fifth conservative justice is confirmed in time to hear it, the ACA could be hanging by a thread. If no new justice is confirmed in time, a 4-4 tie on the Court would leave in place a lower court ruling that declared the ACA unconstitutional.

All Americans affected: For millions of Americans, the paramount threat of an ACA invalidation would be the loss of its protection for people with preexisting conditions. This is important for all Americans for two reasons.

As the Kaiser Family Foundation observed in 2001, “anyone can find himself or herself in need of individual market coverage at some point in their lives,” for reasons that include job loss, self-employment, early retirement, divorce or loss of a breadwinning spouse.

Second, the chance of having a preexisting condition increases with age. According to the foundation, an average of about 15% of those aged 18-24 have a preexisting condition, rising to 47% among those aged 60-64.

Let’s add a third reason: the pandemic. A COVID-19 diagnosis or even a past infection could well be considered a preexisting condition for the purpose of applying for coverage. At the latest count, about 6.9 million Americans have been infected.

So let’s take a look at the consequences of a loss of the ACA’s protection. We don’t have to look far, because the very business model of the pre-ACA individual insurance market was based on rejecting applicants based on their medical history, excluding coverage for their conditions, or jacking up premiums for them to the point that coverage was unaffordable.

Insurance companies instructed their agents and underwriters on whether to accept or reject applicants based on their medical histories.

Rejections: The guidelines issued by Blue Shield of California ran to 25 pages. The “declinable conditions” — those for which applicants could be rejected without further medical review — included “adoption in progress,” kidney stones, depression, arthritis and psoriasis.

These rejections weren’t theoretical. In 2001, Georgetown University and the Kaiser Family Foundation ran a test by applying for coverage in the individual market from 19 insurers in eight local markets, on behalf of seven hypothetical applicants with health issues.

The ostensible conditions, one each, were hay fever, a knee injury, asthma (one child in a family), past cancer, depression, hypertension and HIV. Each putative enrollee made 60 applications.

Not a single applicant received 60 “clean” offers — acceptances without premium surcharges or coverage exclusions. “Alice,” the hay fever victim, received three clean offers, five outright rejections and 46 offers that excluded coverage of her hay fever or even any claim related to her upper respiratory system. Others demanded higher deductibles, premiums or other costs.

“Greg,” who was HIV-positive, was rejected by 100% of the insurers. “Denise,” a breast cancer survivor who had undergone a mastectomy, was rejected 26 times. Among insurers who accepted her, 18 excluded coverage for any cancer and 18 demanded higher premiums.

The “Crane” family, whose 12-year-old son “Colin” suffered from asthma, was accepted by all 60 insurers, but nine refused to cover Colin and 46 refused to cover his asthma or other respiratory claims.

Republicans know well that Americans rank protection for those with medical conditions more highly than any other feature of the ACA. So they’ve generally tried to pair their efforts to repeal the health care law with provisions preserving that protection. These so-called safeguards, however, have been thin gruel indeed.

Some have guaranteed protection only for those who maintain their insurance coverage without a break of, say, 60 days. In practice, that can be hard to achieve. Most Americans who have lost their coverage say it’s because they can’t afford to keep it, and nothing in the GOP proposals would help households get over the cost hump — unlike the ACA, which provides subsidies for millions of lower-income families.

Some proposals forbade insurers to reject applicants with medical histories, but didn’t prevent them from charging those customers more.

What's next?: A proposal introduced in 2018 by Sen. Thom Tillis, R-N.C., and nine other red-state senators was billed as the “Ensuring Coverage for Patients with Pre-Existing Conditions Act.”

As I noted at the time, this measure had a loophole that even the dimmest insurance company could drive a hearse through: While it prohibited insurers from rejecting applicants with preexisting conditions, it didn’t require that the insurer provide for treatment of the condition. An insurer couldn’t reject a cancer patient’s application for insurance — but could provide that patient with coverage for everything except cancer.

What does Trump have in store? Vice President Mike Pence hinted in a CBS News interview Tuesday that Trump plans to institute this all-important consumer protection via an executive order within the next few weeks, so that “those that are facing preexisting conditions … will not be denied coverage.”

These words were typically weaselly — they would accommodate Tillis’ act as well as all those other GOP proposals. But they wouldn’t provide the solid safeguards of the ACA, which prohibits any rejection of any applicant for coverage in the individual market, and allows differentials in premium charges to be based only on an applicant’s age (within strict limits) and for smoking.

Trump and Pence are almost certainly blowing smoke at you. If they were serious about protecting Americans, they would drop their challenge to the ACA. They’re not. If they have their way, the prospect is that Americans seeking insurance in the individual market will face the terrifying prospect of being closed off from health coverage, because of their health.

— Michael Hiltzik is a columnist for the Los Angeles Times.