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GAO Report: Congress Can Undo Trump Administration ACA Waiver Guidance

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Shelley Starkey

GAO Report: Congress Can Undo Trump Administration ACA Waiver Guidance

July 18, 2019 | ACA | Comments
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Congress has the authority to review and overturn Trump Administration guidance on state innovation waivers according to a report released this week by the Government Accountability Office (GAO). The guidance from the Department of Health and Human Services (HHS), issued last October, relaxed requirements around Section 1332 waivers, the Affordable Care Act’s (ACA) vehicle for states to make changes to their individual insurance markets. GAO’s opinion states that the guidance is subject to review by Congress and can be overruled with a simple majority vote in both chambers.

SUMMARY OF PREVIOUS GUIDANCE

The Trump Administration’ stated commitment to providing flexibility for states to offer cheaper insurance options outside of the ACA marketplaces resulted in guidance issued in October 2018, superseding previous Obama-era guidance. Before the Trump administration guidance, states could not submit Section 1332 waivers that would cause a decrease in the number of people with comprehensive and affordable health coverage. However, the new guidance opened the door for short-term and association health plans, which often do not meet the standards laid forth in the ACA, to be considered as acceptable coverage under the state innovation waivers. The National Council continues to stand strongly opposed to efforts to expand AHPs and short-term health plans as they expose more consumers to non-comprehensive plans that lack critical behavioral health care coverage.

Following the October guidance, the Administration unveiled four new state innovation waiver concepts to further encourage states to utilize their newfound flexibility. The new concepts were “designed to illustrate how states can waiver certain ACA provisions under Section 1332 of the law and develop alternatives to the ACA’s otherwise one-size-fits-all approach,” according to Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma.

WHAT THE GAO OPINION MEANS

The GAO report was crafted in response to a request for legal review of the Trump Administration guidance by Senate Finance Committee Ranking Member Ron Wyden (D-OR) and House Committee on Energy and Commerce Chairman Frank Pallone (D-NJ). GAO found that the guidance should have been issued as a proposed rule by HHS rather than guidance, and is therefore subject to certain processes under the Congressional Review Act. Specifically, the guidance must be submitted to both the House, the Senate, and the Comptroller General before it can take effect, and Congress can overturn the proposed rule with a simple majority in both chambers. Ranking Member Wyden has said that Democrats will be introducing a resolution “in the near future” to reverse the guidance.

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