Georgia’s State Relief Waiver Could Restrict Health Insurance Access

When it comes to purchasing health care plans, HealthCare.gov is the one-stop-shop. You can browse, compare, and enroll in a comprehensive plan that works best for you. Currently, all of the states use this health insurance exchange. But now, Georgia could be the first to create a new system for the state.

The plan was approved by President Trump’s administration just two days before the election. It would allow Georgia to waive the requirement of listing all health care plans on the HealthCare.gov website starting in 2023, leaving consumers without a marketplace for health care plans.  

Because individual brokers wouldn’t be required to list all their plans, this change would make it more difficult for individuals to compare and contrast their options.

“It allows the broker to show you and sell non-compliant plans, so short-term plans or plans that don’t cover the essential health benefits,” Erin C. Fuse Brown, JD, MPH, associate professor of law at Georgia State University, tells Verywell. “And so what Georgia has asked for is not eliminate the plan themselves, but to say, we’re not going to have a one-stop-shop anymore and we’re not going to operate this website.”

According to the Center on Budget and Policy Priorities, short-term plans have flaws. They do not have to cover all of the essential health benefits under the Affordable Care Act (ACA) including mental health care, substance use disorder, and prescriptions. For people with preexisting conditions, short-term plans can deny coverage or charge higher prices.

Short-term plans are likely to offer lower premiums. So while short term plans may look cheaper, they might not cover what you need. These plans can also drive people away from more comprehensive health coverage, making comprehensive health care premiums more expensive and undermining ACA protections. 

Shopping for health care is already a daunting task. Georgia’s decision to opt-out of listing health care plans would make the process more confusing and unclear. 

As of early 2020, 433,000 were enrolled in plans via Georgia’s health care marketplace, the fifth highest enrollment rate in the U.S. If Georgia cuts off access to HealthCare.gov, more people are expected to lose coverage. “A lot of people could get thrown off of their coverage, not because their plan goes away, but they won’t know how to find it,” Fuse Brown says. 

The plan’s implementation remains contingent on the upcoming President-elect Biden administration, which could possibly retract approval for the plan.

Is Trump’s Decision Legal? 

Section 1332 of the ACA permits a state to apply for a State Innovation Waiver—also known as a State Relief and Empowerment Waiver—to pursue innovative opportunities to provide residents of that state access to high-quality and affordable health insurance. The idea behind the waivers is that states are allowed to try out new approaches as long as they satisfy federal protections. 

Georgia argues that by doing this, they will get more people enrolled because private insurance brokers will have a financial incentive to get more people signed up.

“It’s plausible. But on the other hand, I worry that the major disruption here is that several hundred thousand people in the state are used to using HealthCare.gov for the past six years,” Benjamin Sommers, MD, PhD, professor of health policy and economics at the Harvard School of Public Health and professor of medicine at the Harvard Medical School, tells Verywell. “Now, suddenly, you’re taking away that pathway.” 

Although President Trump approved this plan, it does not mean it is legal. While these waivers were designed for state experimentation, Georgia’s waiver might not meet federal requirements, according to Sommers.

One of the requirements under section 1332 states that the new proposal should provide coverage to a comparable number of people under the PPACA. Because HealthCare.gov would no longer be used in Georgia, it would push consumers to reach out to individual insurance companies or private insurance brokers. This process may leave more people uninsured and without coverage because it would discourage people from seeking plans, which violates federal requirements.

“Tens of thousands of people will lose their coverage,” Fuse Brown says. “And so this plan can’t possibly be legal under the requirements of the Affordable Care Act.”

Infringing on the ACA

Before the ACA, the Orbitz and Expedia equivalents for buying health insurance didn’t exist. When HealthCare.gov was created, it facilitated a smoother process for health care plan shopping. “The marketplace that the ACA created was really designed to make this easier for consumers,” Sommers says. “That won’t be the case anymore.”

The lack of a single marketplace would make the ACA less accessible. “I worry that there will be a lot of customers who fall between the cracks,” Sommer says.

Georgia’s plan also includes Medicaid expansion limitations. Georgia can now provide coverage to people earning up to 100% of the poverty level as opposed to 138%, as called for in the ACA. In 2019, Georgia enacted legislation SB106 that allowed the state to seek permission from the federal government to expand Medicaid with limitations. 

“For 2020, the poverty level for a single person is just under $13,000,” Sommers says. “That’s the cutoff Georgia would be using. In contrast, if you go up 138%, it’s 17,600. So much more generous under the ACA than what Georgia has gotten approval to do.”

With Georgia’s legislation, only people making $13,000 and under would qualify for Medicaid, leaving people who make over that amount with only private or work-based insurance options. 

The Biden Administration could retract the approval for Georgia’s HealthCare.gov plan in 2021.

However, if the plan is implemented, the health care marketplace could be fragmented, undermining protections for people with preexisting conditions and causing thousands of people to lose health coverage in the state. Georgia would be the first state to operate with no government-run website.