Below are Legislative & Regulatory updates related to the Health Care Industry for May, 2020
Administration Reaffirms Support for Lawsuit that Could Overturn ACA – Last week, President Trump announced that the Department of Justice will continue supporting a lawsuit currently before the Supreme Court that seeks to strike down the ACA. Trump made the announcement after media reports last week suggested Attorney General William Barr urged the White House to change its position on the lawsuit and seek to preserve parts of the ACA in light of the country's coronavirus epidemic. The Justice Department had a Wednesday deadline to change its position in a case brought by Republican-led states. A coalition of Democratic state attorneys general and the Democratic-led House of Representatives are defending the law in court.
The lawsuit argues that the health law was invalidated when Congress eliminated the law’s tax penalty for people who failed to attain health insurance coverage. The ACA is expected to serve as an important safety net for the millions of people who have lost their jobs and work-based health insurance amid the pandemic. If the unemployment rate hits 20%, nearly 25 million Americans could lose their employer-sponsored policies, according to a recent Urban Institute report. House Democrats in a filing to the Supreme Court on Wednesday, argued that the pandemic showcased why justices should preserve the law. “Although Congress may not have enacted the ACA with the specific purpose of combatting a pandemic, the nation’s current public-health emergency has made it impossible to deny that broad access to affordable health care is not just a life-or death matter for millions of Americans, but an indispensable precondition to the social intercourse on which our security, welfare, and liberty ultimately depend,” their brief read. The Supreme Court is expected to hear the case during its next term starting in October, but it has not scheduled oral arguments yet. A decision is unlikely before the Nov. 3 presidential election.
Study Highlights That Decline in Health Spending Contributed to Overall Decline in GDP – A new study commissioned by the Federation of American Hospitals and led by FTI Consulting, estimates that a recent drop in health care spending as a result of the COVID-19 pandemic is the primary cause behind an estimated 4.8% decline in the gross domestic product in the first quarter of the year. COVID-19 has affected all sectors of the US health care system, and many hospitals have been financially impacted as state and federal officials instructed hospitals to cancel scheduled services in the wake of the pandemic. FTI found that the component of GDP relating to hospitals dropped 12.1% in March, a record-breaking figure. “The 12.1% hit to hospitals in Q1 dwarfs the second-largest decline (3.1%) recorded in March 1970,” the analysis said. “During the Great Recession (2007-2013), the monthly decline in hospital revenues never exceeded one percent.” Major health systems such as Tenet, Bon Secours Mercy Health and Detroit Medical Center have furloughed workers due to the crisis. In recent weeks, many states have announced plans to reopen sections of their economy, with a number of states allowing or announcing plans to allow healthcare providers to resume elective surgeries.
Employers Enhancing Health Care and Wellbeing Programs in Response to Pandemic - According to a new Willis Towers Watson survey that examines the business impact of COVID-19 on health benefits, employers are making enhancements to their health care, wellbeing and leave programs as a result of the pandemic. In late April, Willis Towers Watson surveyed 816 employers, representing 12 million workers, and found that 47% are enhancing health benefits, and 45% plan to expand their wellness offerings. Many (64%) of the employers surveyed believe the pandemic will have either a moderate or large impact on workers’ wellbeing, leading them to put a focus on these benefits. More than three quarters (77%) said they were intending to either begin offering or grow their virtual mental health offerings. In addition, 60% said they were enhancing benefits for physical health through technology—such as offering virtual at-home workouts. The survey found a majority of employers don’t expect their health care benefit costs to rise substantially. Fifty-seven percent of respondents anticipate a small to moderate increase in costs, 24% expect no increase or decrease, and only 3% expect a large increase.
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