A longer view of ACA

Now that we know the Affordable Care Act (ACA) survived constitutional review by the Supreme Court on June 28, eyes shift further down the road to the long-term impact of the healthcare reform law.

What lies out toward the horizon? Tom Sullivan, editor of Government Health IT, a sister publication of PhysBizTech, discussed that topic with Bill Bernstein, chairman of the healthcare division at law firm Manatt, Phelps & Phillips, which works with states and providers on health IT and related public policy issues. A summary of their conversation follows.

Q: Given the public sentiment here on the health reform law, is the court’s ruling surprising? 

A: It’s interesting how they got there. But in the end, what’s going to matter is not their constitutional reasoning but how it plays out. At this point, I think the forum really changes, goes to the states. As the opinion makes clear, I don’t think the justices were looking at public sentiment. Just from reading the opinion, I think they based this on a well-thought theory of the powers of federal and state government. I'm reading the Roberts opinion, just halfway through it, and it’s impressive.

Q: Will knowing how the court has ruled put many people in the healthcare realm at ease?
A: I think so. We all know somebody with a pre-existing condition. A big part of this is the fact that if you apply for coverage, you have to receive it and the fact that they can’t discriminate based on pre-existing conditions. That’s a huge step forward in terms or providing people access to basic healthcare coverage – and that’s a big day in American history.

Q: And among Manatt’s clients, do you anticipate a sense of hurry-up-and-wait among healthcare organizations? There is still uncertainty with the coming election on the horizon and Mitt Romney threatening to repeal the ACA.

A: I think this is going to play out differently in different parts of the country. There is a lot of implementation work that has to happen at the state level. In part of the country, it won’t be hurry-up-and-wait at all, it will be full foot on the accelerator to implement both the Medicaid expansion and the exchange provisions. Some states may have a view that 'the election's close, so let's wait' but I think that it’s highly unlikely that the election would lead to a change in a lot of the fundamental provisions of the ACA. There’s so much of it that's popular. When people really think about it, the genie’s out of the bottle at this point. And I think even in the recalcitrant states, they’ll eventually decide to go forward and implement the law’s provisions.

Q: With Romney’s promises of repeal, does the fact that the Supreme Court upheld ACA lessen his chances of accomplishing that, should he win the White House? 

A: I think so. We now have a framework for reform and even if he won the White House he’d have to win both houses of Congress to repeal it but I also think its very hard to take away some of the benefits that the law grants. The debate is going to change. One thing to watch is the court did say that in terms of the Medicaid expansion provisions, states have the choice to still be part of Medicaid and not do the expansion. Now, when you think about how that plays out, it is going to be interesting because Medicaid expansion is mostly federally funded. So to not expand the program, a state has that choice but it would certainly be a major blow to its citizens were it to not take advantage of the federal funding to make the expansion happen.

Q: That will be fascinating to watch because of that perceived federal overreach that many of the more conservative states, ones with a Tea Party prevalence, are dead-set against. 

A: I think you’ll see in the short-term a lot of ideological language around that. But when the dust settles, states are provided a tremendous opportunity to extend benefits to a lot of the citizenry. Even if you look at what’s happened today despite all the political rhetoric, 49 states have taken federal money from the ACA, either Medicaid money or exchange funding – meaning that a lot of that political rhetoric has not matched up with what the states are actually doing.

Q: There’s a lot of speculation about whether the court's ruling signals a victory for Obama that will carry him to re-election…or does it serve as a galvanizing force for the right to elect a president and Congress that will overturn the law?
A: It’s hard to make political predictions but in my view, this makes the program a winner. It’s doing something that’s so fundamentally good that it’s a high-risk strategy politically to say ‘We don’t want to do the things the law is now allowing and the Supreme Court has said you can do.’ I think they’ll make a lot of hay that the justices characterized the mandate as a tax.

Q: So what is your firm telling your clients that this ruling ultimately means? 

A: For most of our clients either on the provider or payer side, this is good news. It provides clarity and it provides expansion of benefits and what it doesn’t do what would have been really hard for people in the healthcare sector would be to go through a period of great uncertainty wherein it was hard to make plans around what was happening. And I think most of our clients who are running businesses, but are also very committed to providing healthcare access and quality care, view the ACA as a really positive thing.