ACA repeal lawsuit would end health coverage for 230,000 Arkansans, new data show

Lawsuit more dangerous than ever for Arkansans during pandemic and economic crisis

If a lawsuit before the Supreme Court to repeal the Affordable Care Act (ACA) succeeds, 230,000 Arkansans would lose health coverage, increasing by 152 percent the number of Arkansans who are uninsured, a new analysis from the nonpartisan Urban Institute estimates. Despite the COVID-19 pandemic and resulting major recession, the Trump Administration and 18 state attorneys general, including Arkansas’s Attorney General Rutledge, are asking the Supreme Court to strike down the entire ACA. Oral arguments before the Supreme Court are scheduled for November 10.

If it succeeds, the ACA repeal lawsuit would throw the health care system into chaos in the middle of a pandemic and recession. Thousands of Arkansans would lose health coverage when they need it most, and many more would pay more for coverage or care and lose protections for their pre-existing conditions.

If the ACA is struck down, an estimated 21 million people would lose coverage nationally in 2022, according to the new analysis. The coverage losses could be even larger in 2021 when the case is decided, as the public health crisis and resulting recession are likely to still be ongoing.

The ACA has been a lifeline during the pandemic, providing coverage for many of the thousands of Arkansans who have lost their jobs or experienced sharp drops in income in the recession.

The large coverage losses from striking down the ACA would reverse the law’s historic progress in reducing racial health disparities in health coverage and access to care that often stem from structural racism. While overturning the ACA would increase uninsured rates dramatically for all racial and ethnic groups, it would cause nearly 1 in 10 non-elderly Black and Hispanic people nationwide, and more than 1 in 10 American Indians and Alaska Natives, to lose their health coverage and become uninsured.

Coverage losses would also hurt hospitals and other health care providers. Arkansas’s hospitals’ uncompensated care costs have fallen by 57 percent since the implementation of the ACA’s major coverage provisions, based on data from the Medicaid and CHIP Payment and Access Commission.

Repeal would also end provisions that prevent insurance companies from denying coverage to or charging much more for coverage to people with pre-existing conditions like diabetes or cancer, or potentially, COVID-19. It would allow insurance companies to re-introduce annual and lifetime limits on coverage, including for people with health insurance through their jobs, and it would end the requirement that insurers let young adults get covered through their parents’ plans.

But there would be some winners if the lawsuit succeeds. Wealthy people and certain corporations would receive billions in tax cuts, a Center on Budget and Policy Priorities analysis shows:

  • The highest-income 0.1 percent (1 in 1,000) households would receive tax cuts averaging about $198,000 per year. This group has annual incomes over $3 million.  A portion of these tax cuts would come at the expense of the Medicare Trust Fund, which would lose about $10 billion in revenue each year.
  • Pharmaceutical companies would pay $2.8 billion less in taxes each year, even as millions of seniors could pay billions more for prescription drugs because eliminating the ACA could reopen the “donut hole” gap in Medicare’s prescription drug benefit.

The ACA has bolstered Arkansas’s ability to deal with both the pandemic and the resulting economic recession. Striking down the law would harm those who have suffered the most as a result of the public health crisis and economic fallout, while showering large tax cuts on the very wealthiest.