The Evolving Health Care Landscape


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The Evolving Health Care Landscape

Recent legislative, regulatory, and administrative changes that are impacting the ACA.

The next era of health care reform began in January 2017 when, for the first time since the Affordable Care Act (ACA) became law, a Republican-controlled Congress and administration took office. While full repeal and replace efforts were unsuccessful prior to Democrats taking control of the U.S. House in 2019, health care remains a priority, with further legislative and regulatory action anticipated at both the federal and state levels.

Supreme Court to Hear California v. Texas ACA Case

The U.S. Supreme Court will hear oral arguments in California v. Texas (known as Texas v. Azar in the lower courts) in November, with a ruling expected in spring 2021. The justices will rule on the constitutionality of the individual mandate without a tax penalty, and whether the mandate is severable from the rest of the law, which will determine the future of the ACA. The Supreme Court has twice upheld the ACA in the previous major challenges to the law; however, the confirmation of Judge Amy Coney Barrett to replace Supreme Court Justice Ruth Bader Ginsburg could impact the ruling in California v. Texas.

The 2017 Tax Cuts and Jobs Act included a permanent effective repeal of the individual mandate by zeroing out the penalty beginning in 2019, which led to the current litigation. In 2018, a district court issued a ruling that determined the ACA is unconstitutional because of the federal tax law change that zeroed out the penalty. The judge further stated that because the mandate was essential to the law, it could not be severed from the rest of the ACA, which meant the entire ACA was invalid. This ruling was appealed, and in December 2019, the United States Court of Appeals for the Fifth Circuit ruled the ACA's individual mandate is unconstitutional, but it did not invalidate the rest of the law. It remanded the case back to the district court judge for further severability analysis. Soon after, the Supreme Court agreed to review the case.

The ACA remains in effect while the litigation is pending.

Changes to Federal Health Care Rules and Regulations

The following chart outlines key changes to the ACA and related federal health care topics through legislative, regulatory, or executive action since January 2017, when the new administration took office.

Regulatory Change Effective Date More Information
Impacts to All Markets

Association Health Plans
Allows more employers to form AHPs, which are not subject to certain ACA rules

Staggered effective dates, beginning 9/1/18, based on type of AHP

Read our Association Health Plan FAQs

Comparative Effectiveness Research Fee (CERF) Extended
Originally expiring in 2019, extends the fee for 10 years through 2029

Effective through 12/31/2029

Extension was part of the 2019 year-end spending agreement.

Essential Health Benefits State Benchmark Plans
Provides states greater flexibility in selecting a benchmark plan for individual and small group markets

Effective 1/1/20

Read our April 9, 2018 news alert

Expanded List of Preventive Care Benefits Under High-Deductible Health Plans
Expands the list of preventive care services and items for certain chronic conditions permitted to be provided by an HDHP without a deductible

Effective 7/17/19

Read the July 17, 2019 IRS Notice

Health Reimbursement Arrangements
Allows employers to offer employees HRAs to purchase Individual coverage

Effective 1/1/20

Read our June 17, 2019 news alert

Individual Mandate Repealed
Effectively repealed mandate by zeroing out penalty beginning in 2019

Effective 1/1/19

Read our Dec. 20, 2017 news alert

Short-Term, Limited Duration Insurance Plans
Allows plans, which are not subject to certain ACA rules, to have a maximum initial coverage period of up to 12 months and be renewed or extended for no more than 36 months

Effective 10/3/18

Read our Short-Term, Limited Duration Insurance FAQs

Section 1557 Nondiscrimination Rule
Replaces the original final rule from 2016 and repeals or revises key provisions of that 2016 rule

Effective 8/18/20, with exceptions

Read our June 16, 2020 news alert
On Aug. 18, 2020, a district court stayed the rule’s repeal of the 2016 definition of discrimination on the “basis of sex.” The 2016 definition will remain in effect pending further court or administrative action. Other provisions in the 2020 rule remain in effect as of Aug. 18, 2020.

Impacts to the Group Market

Cadillac Tax Repealed
40 percent excise tax on high-cost employer plans repealed

No longer exists and will never take effect

Read our Dec. 20, 2019 news alert

Contraception Coverage Requirement – Expanded Exemption
Final rules expand exemptions for group health plan sponsors from covering contraceptive services for women


Read our Oct. 13, 2017 news alert
The expanded exemption was challenged; however, the Supreme Court ruled in favor of the Trump Administration and sent the case back to a lower court to dissolve the nationwide injunction that blocked implementation.

Health Insurance Industry Fee (HIIF) Repealed
HIIF in effect for 2020, repealed as of 2021

Effective 1/1/21

Read our Dec. 20, 2019 news alert

Impacts to the Individual or Medicare Market

Medicare Part D "Donut Hole" closure accelerated
Originally scheduled to end in 2020, will now close in 2019

Effective 1/1/19

Read our Medicare Part D Coverage Gap FAQ