Court decision means cost sharing could be reinstated for some preventive healthcare services

Comprehensive coverage of some preventive care services could be jeopardized by a recent court ruling.

Since its passage, the Affordable Care Act (ACA) had required health plans to cover the full cost of services that received an “A” or “B” rating from the U.S. Preventive Services Task Force (USPSTF). A federal judge in Texas ended that requirement with a March 30 decision.

The decision by Judge Reed O’Connor applied remedies to his September 2022 ruling that found the requirement violated the Religious Freedom Restoration Act (RFRA) by obligating plans to cover pre-exposure prophylaxis (PrEP) for people at risk of contracting HIV. As part of the March 30 ruling, mandatory first-dollar coverage of all services that receive high ratings from the USPSTF likewise was deemed unconstitutional.

There are numerous such services, among them colonoscopies; screenings for diabetes, high cholesterol and hypertension; and tobacco cessation counseling.

The short-term impact of the decision may be muted, however.

“Although the ruling is effective immediately, in many cases, health plan contracts are in place for the calendar year, and employers do not typically make changes to coverage or cost midyear,” analysts with the Kaiser Family Foundation wrote after the ruling.

Insurers sound as though they’ll maintain the status quo at least while the case works its way through the appeals process. The U.S. Department of Health and Human Services (HHS) announced March 31 it would appeal the decision.

“We want to be clear: Americans should have peace of mind there will be no immediate disruption in care or coverage,” Matt Eyles, president and CEO of AHIP, said in a written statement. “We fully expect that this matter will continue on appeal, and we await the federal government’s next steps in the litigation, as well as any guidance from relevant federal agencies.”

The rationale for the ruling

O’Connor, who was nominated by President George W. Bush, ruled in 2018 that the entire ACA was unconstitutional because of an issue involving the individual mandate to have health insurance (the penalty for noncompliance previously had been zeroed out by Republicans in Congress, a move O’Connor said nullified the constitutionality of the entire law). The Supreme Court ultimately overruled that decision.

O’Connor explained his latest ruling, in part, by writing: “As this court previously held [in September], properly framed in the context of this RFRA case, the question is whether the government has a compelling interest in requiring all private insurers to cover PrEP drugs in every one of their insurance policies. But neither Congress nor PSTF expressed that compelling interest, and the ACA’s several exemptions for grandfathered plans and small businesses undermine defendants’ argument that all insurers must provide plans with PrEP drug coverage.”

Beyond that, he added, any coverage policy dictated by a USPSTF rating issued after passage of the ACA violates the U.S. Constitution’s Appointments Clause. The reason is that task force members have not been appointed by the president and approved by the Senate as prescribed by the clause.

Thus, the ruling “vacates any and all agency actions implementing or enforcing that provision’s mandatory coverage requirements, and enjoins defendants [i.e., HHS] and their officers, agents, servants and employees from implementing or enforcing the compulsory preventive care coverage mandate in the future.”

Some first-dollar coverage unaffected

O’Connor said his ruling does not affect the ACA’s requirement for most health plans to cover contraceptive products or services and recommended vaccines without cost sharing.

He said the difference lies in the authorization provided to the Health Resources and Services Administration (HRSA), which recommends preventive care and screening for children and women, a category that includes FDA-approved contraceptives along with services such as mammograms, Pap tests and prenatal care; and to the CDC’s Advisory Committee on Immunization Practices (ACIP), which recommends vaccines.

“Both ACIP and HRSA are ultimately subject to the ‘supervision and direction’ of the HHS Secretary,” according to the ruling. “By contrast, PSTF is a volunteer body of nonfederal experts that provides evidence-based recommendations related to preventive care services and health promotion.”

Thus, O’Connor wrote, USPSTF members should have been subject to the Appointments Clause.

His ruling affects USPSTF recommendations that were established after the ACA was signed March 23, 2010. Recommendations from before that date still can be subject the no-cost-sharing requirement, although any subsequent updates to such recommendations would not fall into that category.

About 15 states have laws ensuring coverage with no cost sharing in the ACA insurance marketplaces for all federally recommended preventive services, experts with Georgetown University noted last year in a blog post published by the Commonwealth Fund. Some of the states also apply that policy to enrollees in group plans, although self-insured employer plans are not subject to state regulation.

Trepidation over the fallout

The American Medical Association issued a statement criticizing the decision.

“Providing insurance coverage for screenings and interventions that prevent disease saves lives — period,” according to the statement from AMA President Jack Resneck Jr. “Invalidating this provision jeopardizes tools physicians use every day to improve the health of our patients.

“And the burden of losing this first-dollar coverage will fall disproportionately on low-income and historically marginalized communities that are least able to afford it and are often at high risk of developing preventable medical conditions.”

In addition to the Biden administration’s appeal, conservative groups could appeal the ruling due to its narrow application. O’Connor’s ruling theoretically can be expanded by the conservative-leaning Fifth Circuit Court of Appeals to include other preventive services. Regardless, the issue seems likely to reach the Supreme Court.

“This is the first time a court has ruled that the ACA preventive services coverage requirement other than the contraceptive coverage requirement violates employers’ religious rights,” according to the KFF analysis (litigation decided in 2020 allowed employers who objected on moral grounds to refrain from covering contraceptive services). “This has the potential to open the door to employers objecting to other services, such as vaccines.”

Rep. Suzan DelBene (D-Wash.) issued a statement expressing concern that the ruling could lead to a rollback of full coverage of contraceptive services at a time when access to reproductive health services is in flux in some states.

“I am extremely concerned that this decision also paves the way to strike down access to contraception,” she said.