The Affordable Care Act (ACA) is a mosaic across a spectrum of health policy domains. The law contains hundreds of smaller and mostly unnoticed reforms aimed at nearly every segment of American health policy. Ten years later, these provisions include successes, failures, and mixed bags, which should be considered in any full assessment of the ACA. This article examines 11 from each of these 3 categories, drawn from 9 of the ACA's 10 titles. These mininarratives deepen recognition that the ACA is our best example of comprehensive health reform and defies simplistic judgments.
Though the Affordable Care Act (ACA) is only one law, the statute itself is a mosaic across a spectrum of health policy domains. Beside marquee provisions involving Medicare, Medicaid, private health insurance, delivery system transformation, and financing, the ACA contains hundreds of smaller and mostly unnoticed reforms aimed at nearly every segment of American health policy. Ten years later, these provisions include successes, failures, and mixed bags, which should be considered in any full assessment of the ACA. I examine 11, from each of these 3 categories, drawn from 9 of the ACA's 10 titles. These mininarratives deepen recognition that the ACA is our best example of comprehensive health reform and defies simplistic judgments.
The successes I examine comprise state-run health insurance exchanges, Medicaid's Modified Adjusted Gross Income (MAGI) standard, the Physician Payments Sunshine Act, and new Medicare payroll taxes. Under proposed failures I examine health insurance cooperatives, the Independent Payment Advisory Board (IPAB), the Health Workforce Commission, and the Community Living Assistance Services and Supports (CLASS) program. Mixed results comprise Calorie Menu Labeling, the Elder Justice Act, and biosimilar biopharmaceutical innovation. For each, I describe what the enacted ACA component was intended to accomplish plus a summary of key developments since then. I conclude with brief observations and conclusions.
Success Stories in ACA Implementation
I define successes as ACA provisions that were implemented substantially as formulated in the statute and that have shown demonstrable positive outcomes.
State Health Insurance Exchanges (Title 1, Subtitle D)
Though both Senate- and House-approved versions of health reform legislation in 2009 incorporated the “health insurance exchange” concept to facilitate the purchase of individual health insurance policies, differences were substantial. The House preferred sole federal management of exchanges in all 50 states by the US Department of Health and Human Services (HHS). The Senate, more deferential to states, gave them right of first refusal, with HHS as backup for nonparticipants. The disagreement ended by default after Senate Democrats lost their 60–seat majority in January 2010 and approving the Senate version became the only pathway to pass a health reform statute.
Senate drafters wrongly assumed that most states would want to establish marketplaces to maintain maximum authority over their individual health insurance markets. Mostly Democratic-controlled state governments stepped forward, initially joined by some Republican leaders in conservative states. As ACA implementation became entrenched partisan warfare, conservative activists convinced political leaders in nearly all Republican-controlled states to reject creating marketplaces that might legitimize the law they despised. The ranks of participating Democratic states thinned because of the ACA's 2013 website catastrophe that disabled the HHS and numerous state websites. By 2016, only 13 states fully ran their own exchanges, nearly all in Democrat-dominated states.
In the state-federal health exchange experiment, we have a verdict: hands down, the 13 states win. Almost across the board, states with their own exchanges have achieved higher enrollment rates than their federally reliant peers, along with lower premiums and better consumer education and protection. They have proven more resilient in withstanding Trump administration moves to discourage enrollment. This makes sense: those using the state marketplace model (SBM) have reputations on the line and are committed to success. For example, between 2016 and 2019, SBM states saw an 11.5% increase in young enrollees, while states with federally facilitated marketplaces experienced an 11.3% drop. While Marketplace premiums across the nation spiked from 2016 to 2018 because of market uncertainty, since 2014 states with federally facilitated marketplaces have seen 87% premium growth while SBM states saw 47% growth (NASHP 2019).
With this evidence, it is unsurprising that policy makers in some states (Maine, New Jersey, New Mexico, and Pennsylvania) are now moving to launch their own exchanges; Nevada opened its own in fall 2019. While it is true that overall federal and state exchange enrollment came substantially below Congressional Budget Office (CBO) expectations in 2010, that is a broader ACA policy issue. Had most states established exchanges, numbers of uninsured would have diminished even more.
Medicaid's Modified Adjusted Gross Income Standard (Title 2, Section 2001)
The saying about Medicaid used to be, “If you've seen one state Medicaid program, you've seen one state Medicaid program.” This is still true, but less so because of Title 2 and MAGI, the new uniform national income eligibility standard. Since its establishment in 1965, Medicaid varied enormously across states and the District of Columbia. Some states sought to identify and enroll as many eligible families as possible, while others sought to deter enrollment, making it as challenging as possible to enroll and stay. One method to discourage enrollment was to define household income in as restrictive and exclusionary a manner as legally permissible.
Title 2 changed this dynamic by mandating uniform national rules to determine financial eligibility for Medicaid, subsidized coverage in the exchanges, and the Children's Health Insurance Program (CHIP). The ACA sets one definition for household income, especially what counts and what doesn't count toward that standard (e.g., tips and unemployment compensation count as income, while child support and worker's compensation payments do not). MAGI enables families to move to other states and retain eligibility, even when transitioning between Medicaid and exchange coverage because of household income fluctuation, lessening the dynamic called “churn” (Ryan and Artiga 2015). Milligan (2015) refers to MAGI as one of the ACA's “overlooked virtues.” While full MAGI implementation has been slow in some states, others have seen dramatic improvement in coverage renewals.
The Physician Payments Sunshine Act and the Open Payments Website (Title 6, Section 6002)
Over decades, evidence has shown that most physicians and other medical care providers receive gifts, honoraria, and other benefits bestowed by drug and medical device companies to influence medical decision making. To discourage this, ACA crafters placed the Physician Payments Sunshine Act into Title 6, requiring medical industries to disclose to the HHS all non-care-related payments to physicians, teaching hospitals, and others. HHS uses this information to populate its Open Payments website, where anyone can search and view disclosures of payments to physicians, teaching hospitals, and others providers, and to make annual reports to Congress (HHS and CMS 2019). Surprisingly, the Sunshine Act passed with support from pharmaceutical, medical device, and other stakeholders—to stem a proliferation of similar state requirements.
Since the 2013 launch of Open Payments, no sign of mass consumer participation is apparent; one study showed that while 65% of surveyed patients had seen a physician who received an industry payment in the past year, only 12% of knew that payment information was available, and only 5% knew whether their doctor received a payment (Pham-Kanter et al. 2017). On the other hand, the nonprofit investigative journalism group ProPublica has created a user-friendly site called Dollars for Docs (projects.propublica.org/docdollars) that uses the data to document, between 2013 and 2018, $12 billion in payments from 2,191 corporations to 1,036,165 medical providers and 1,249 teaching hospitals. The US Department of Justice, the Food and Drug Administration (FDA), and other federal agencies now cross-reference Open Payments reports with prescriber databases to identify violations of antikickback and false claims statutes (Litman 2018). For those seeking transparency, here it is.
New Medicare Payroll Taxes (Title 9, Section 9015)
The twenty-first century, as of 2020, has seen enactment of three major federal health laws: the 2003 Medicare Modernization Act (MMA), 2010 Affordable Care Act (ACA), and 2015 Medicare and CHIP Reauthorization Act (MACRA). While ACA received zero Republican support, MMA and MACRA had bipartisan support. Of note, MMA and MACRA were mostly deficit financed, creating hundreds of billions in new federal debt. The ACA, in contrast, was completely self-financed, mostly through payment cuts to Medicare providers and care delivery efficiencies in Title 3, and new taxes in Title 9. Tax targets included drug, health insurance, and medical device companies (the latter two were repealed in late 2019's budget deal), and most important, high-income households earning above $200,000 for individuals and $250,000 for families via new Medicare payroll taxes on earned and unearned income.
At $210 billion in projected revenue (2010–19), this last item is the ACA's largest single financing source. It is also distinctly progressive, placing the heaviest burden on the most affluent. Though Republicans attempted to repeal all of Title 9 in their 2017 “repeal and replace” efforts, the new payroll taxes were implemented without incident or even much public notice, until Republicans' 2017 repeal campaign. According to the New York Times, the tax hike, especially the 3.8% tax on net investment income, had a significant impact in reducing US income inequality during this decade (Norris 2014). The 0.9% tax on earnings raised $10 billion in 2018, while the net investment income tax raised $27 billion, paid only by the top 5% of income earners and especially the top 1% (Tax Policy Center, n.d.).
Failures in ACA Implementation
Any complex statute results in implementation challenges, positive and negative, expected and surprising. Given the ACA's numerous provisions, it is unsurprising that some failed. These are noteworthy among them.
Consumer Operated and Oriented Plan Program (Title 1, Section 1322)
In summer 2009, Sen. Kent Conrad (D-ND) promoted nonprofit health insurance cooperatives as an alternative to the so-called public option and used his perch on the Senate Finance Committee to secure inclusion in the ACA as the Consumer Operated and Oriented Plan Program (CO-OP). While many observers discounted the provision as window dressing, they were surprised when 23 CO-OPs emerged to serve enrollees in 26 states, with $2.4 billion in federal start-up and solvency loans. The Obama administration took a supportive approach, deciding that CO-OPs might inject needed competition into marketplaces.
In the ACA, Congress authorized up to $6 billion in support, rescinding more than $4 billion between 2011 and 2013 and halting new CO-OPs in 2015 (40 applications were pending). Congress responded positively to insurance industry lobbying to prevent use of federal funds for marketing, by limiting CO-OPs' ability to grow in employer markets and by requiring full loan payback within 5 years. Many CO-OPs ran into early fiscal trouble from multiple directions: some badly over- or underestimated enrollments; many were damaged by the ACA's risk adjustment and risk corridor provisions; others suffered from management deficiencies. By the time a scathing Senate oversight report was released in March 2016, only 10 remained (Permanent Subcommittee on Investigations 2016). As of early 2019, only four remain functioning in five states (Norris 2019).
The ACA's aspiration was for CO-OPs in all 50 states—if not a failure, it is at best a D minus. Who is at fault? Fingers point to ineffective oversight by the Obama administration, congressional Republican sabotage, insurance industry undermining, CO-OP management flaws, and ACA design features. It was all five—how much from each is where arguments begin.
The National Health Care Workforce Commission (Title 5, Section 5101)
While many ACA elements were fought fiercely among congressional Democrats and Republicans, one provision provoked broad support: the establishment of the National Health Care Workforce Commission, the crown jewel of Title 5, the health workforce part of the law. Modeled on the Medicare Payment Advisory Commission, the commission was tasked to collect data, develop analyses, and make recommendations to Congress, the administration, states, counties, municipalities, and the private sector to develop a healthy workforce better able to meet the needs of evolving American society. The US comptroller general was directed to fill the commission by late 2010. On time, he named 15 experts representing the diversity of health workforce concerns.
Major ACA elements received direct appropriations, thus avoiding annual funding battles that can tie Congress in knots and disable any law or program. Such consideration for the commission was considered unnecessary because of its broad support. In 2011, hats in hands, commission supporters, led by newly designated chairperson Dr. Peter Buerhaus (a nursing workforce expert and now professor at Montana State University), went to Congress seeking $3 million in appropriations as requested by the Obama administration to begin work (Buerhaus and Retchin 2013). Without appropriations, commission members were legally prohibited from even convening. Also, 2011 was the year Republicans reclaimed majority control of the US House of Representatives. Buerhaus and Retchin (2013) describe the expressions of sympathy they received from them, but no support, because the commission was a creature of the vilified ObamaCare.
By late 2019, all staggered terms of commission members have long since expired. The Government Accountability Office labels the commission status as “inactive”; others use the term “dormant.” Either way is putting it mildly.
Independent Payment Advisory Board, Title 3, Section 3403
During the ACA's legislative process, complaints arose in fall 2009 that the bill lacked meaningful cost controls. Sen. Jay Rockefeller (D-WV) agreed and won inclusion of the IPAB, a new entity to be composed of 15 members who would be summoned to duty whenever Medicare spending growth exceeded statutory targets. The IPAB would be directed to recommend how to lower Medicare's rate of growth to the spending benchmark, though recommendations could not include eligibility or benefit cuts or tax increases, leaving provider payment cuts as the primary available tool. If Congress failed to pass alternative remedies to save at least as much as would the IPAB's recommendations, then those recommendations would take effect with the force of law. What's more, if an IPAB was not appointed, the HHS secretary was directed to act as the board and make statutorily binding Medicare program changes.
Following ACA enactment, health care provider groups began mobilizing to weaken or repeal the IPAB. In the conservative backlash to the ACA, Sarah Palin, the Wall Street Journal, and others identified IPAB as the so-called death panel that would decide whether individual Medicare enrollees would receive medically necessary services (Palin 2010). In the intense ACA implementation period through 2014, the Obama administration chose not to nominate anyone for the IPAB. Once Republicans assumed majority control of the Senate in 2015, chances for approval of any IPAB nominee dropped to zero. But the anti-IPAB provider coalition remained worried about the HHS secretary assuming IPAB powers, even though Medicare per-enrollee spending growth throughout the decade had dropped to historically low rates of increase—in no year between 2013 and 2018 did the rate of Medicare spending growth exceed the CBO's 2010 benchmark. Democrats also worried about how the Trump administration might use IPAB's power to make changes to Medicare.
On February 9, 2018, the US House and Senate voted to repeal IPAB in the Bipartisan Budget Act of 2018, signed that day by President Trump. In its analysis of the enacted ACA, the CBO estimated that IPAB would save the federal government $15.5 billion through 2019. Actual savings from lower than projected inflation were far greater than that amount. IPAB's demise is another indication of the difficulty in implementing and sustaining health care cost control mechanisms—even those that can survive the legislative process.
Community Living Assistance Services and Supports (Title 8)
CLASS was a personal priority for my former boss, the late Sen. Edward Kennedy (D-MA), who avidly sought a way to provide cash support to temporarily or permanently disabled Americans to assist them in living independently outside institutions. Because the ACA already included a mandate on individuals to purchase health insurance (in Title 1), congressional leaders deemed the inclusion of a second mandate for CLASS as politically infeasible. CLASS became Title 8 of the ACA, structured as a voluntary insurance program in which anyone could enroll and receive benefits after 5 years of uninterrupted premium payments. Because of its voluntary design, it also faced massive risk selection problems, among others. After Kennedy's death, his close friend Sen. Chris Dodd (D-CT) secured its inclusion despite opposition from most Republicans and influential Democrats, such as Senate Finance Chair Max Baucus (D-MT).
In October 2011, the Obama administration declared CLASS to be unworkable, with HHS Secretary Kathleen Sebelius declaring: “I do not see a viable path forward for CLASS implementation at this time” (Wayne and Armstrong 2011). CLASS repeal was signed by President Obama on January 1, 2013—the only ACA title to be repealed in toto. In the bill, Congress established a special commission to consider alternatives—a commission that proved unable to agree on any alternative.
Connie Garner, a neonatal intensive care nurse practitioner, was Senator Kennedy's point person on CLASS, its fiercest advocate. Garner now runs Allies for Independence, a national advocacy organization that continues advocating for the cause. Perhaps most significant, in May 2019 Washington Governor Jay Inslee signed into law the nation's first public and state-operated long-term care insurance program that is scheduled to begin in 2022, to be financed by a mandatory new tax of $0.58 on every $100 of income, going into a state trust fund (Lieber 2019).
Mixed Results in ACA Implementation
Calorie Labeling for Chain Restaurant Menus (Title 4, Section 4205)
In the first decade of the twenty-first century, in response to the rapidly growing obesity epidemic among Americans of all ages, some local governments began requiring chain restaurants to post the number of calories for each food item on their menus and menu boards. Initially resistant, the restaurant industry found it was unable to block passage of local laws that varied substantially in details. To avoid a regulatory Tower of Babel, the industry endorsed a national calorie posting requirement in Title 4, the public health part of the law. Though scheduled to start in 2013, the FDA encountered intense conflict over regulatory details from movie theaters, pizza chains, grocery stores, and others that nearly derailed the entire system until May 2018, when it was finally implemented by the Trump administration.
Many food chains did not wait until 2018 to begin posting, thus enabling early research on the practice. Two findings dominate the literature. First, initial posting of calorie content triggers at best a short-lived reduction in consumed calories (Long et al. 2015). A Cochrane review estimated as much as a 50–calorie impact per meal, though it considered the quality of that evidence “low” (Crockett et al. 2018). Second, in response to calorie labeling, behavior change is observable and sustained by numerous restaurants chains that have trended toward discontinuing high-calorie items, thus reducing calorie content without relying on individual behavior change (Bleich, Wolfson, and Jarlenski 2017; Bleich et al. 2018). Though judgments on its effectiveness vary, the law seems here to stay.
Elder Justice Act (Title 6, Subtitle H)
A 2010 study concluded that 11% of individuals age 60 and over reported receiving abusive behavior in the previous year, including verbal, financial, or physical mistreatment by family members or others, a number experts regard as an underestimate (Acierno et al. 2010). Former Sen. John Breaux (D-LA) first filed the Elder Justice Act in 2002 to initiate a coordinated and comprehensive approach to elder abuse and to advance state-level responses. After Breaux's retirement, Sen. Richard Durbin (D-IL) and former Sen. Orrin Hatch (R-UT) picked up the cause. After years of trying, the national Elder Justice Coalition saw their proposal become part of Title 6. For elder justice advocates, it was a historic landmark.
Developments since enactment have been disappointing. In 2017, the Congressional Research Service issued a status report on the act (Colello 2017). On the positive side, a HHS Elder Justice Coordinating Council was established in 2012 with representation from the US Department of Justice and HHS. Conversely, Congress appropriated none of the authorized funding for elder abuse forensic centers, none for enhancement of abuse prevention in long-term care facilities, none for grants to support adult protective services, and none for the Long-Term Care Ombudsman grants/training program or for a national nurse aide registry.
In fiscal years 2012 and 2013, the Obama administration diverted $8 million from the ACA's Public Health and Prevention Fund for Adult Protective Services. In 2015 and 2016, the first time since enactment, Congress appropriated $4 and $8 million, respectively, for similar activities—after the ACA's funding authorization expired. Though marginal advances have been achieved since 2010, the great promises of the Elder Justice Act have not materialized. State governments and advocates continue fighting the epidemic without a full-on federal partner.
Biologics Price Competition and Innovation Act (Title 7)
Few ACA issues instigated more intense stakeholder conflict and hardball lobbying than Title 7 directing the FDA to create a regulatory pathway to license biological products shown to be “biosimilar” or interchangeable with a licensed biopharmaceutical drug. The doorway opened in 2014, and as of November 2019, the FDA has approved 25 biosimilar products.
The model for Title 7 was the 1984 Hatch Waxman Act that unleashed the generic drug revolution in the US pharmaceutical sector—today nearly 90% of prescribed drugs in the United States are generics selling at a fraction of brand-name prices. The generic model is imperfect because the process to make biosimilars, containing live viruses, is distinctly different from commodity manufacturing of traditional generics. Those hoping for many biosimilar products and dramatically lower prices were engaged in wishful thinking.
While every stakeholder—drug and biotechnology companies, business, labor, consumers, insurers—wanted to create the biosimilar pathway, drug and biotech companies wanted extended patent protection for no less than 12 years, while other stakeholders wanted no more than 5 years. Pharma/biotech won 12 years, another factor that has slowed the market. While the CBO estimated a mere $7 billion in federal budget savings between 2010 and 2019, a recent RAND study projects $54 billion (with a range of $24–150 billion) between 2017 and 2026 (Mulcahy, Hlavka, and Case 2018). While many are dissatisfied with the market impact of biosimilars, ACA authors always assumed this would be a robust market for the 2020s and beyond.
The ACA includes an extensive collection of health policies, some newly developed between 2009 and 2010 and others that had waited years for a window of opportunity. The law is judged mostly on its top-line policies relating to access, insurance, cost control, and delivery system reform. The overall collection of ACA policies is far more diverse and extensive than recognized, far more than the 11 assessed in this review. Some have succeeded while others failed, and others are still works in progress. Many, perhaps most, of these policies would never have seen the light of day were it not for the generational opportunity provided by the ACA process. Many of these lesser-known policies continue making a meaningful impact, for better or worse, within the US health care system. Like nearly everything else involving the ACA, judgments usually vary depending on one's ideological views toward the base law.
The legendary Russian actor and director Konstantin Stanislavski is reported to have claimed, “There are no small parts, only small actors.” We can notice, 10 years later, that in all of the ACA's secondary roles, smaller and yet fully attentive publics pay close attention. For affected stakeholders, these bit parts have an ongoing, meaningful, and unrecognized impact on America's health care system.
Special thanks to Karen Jiang for research assistance.