The ACA preventive care 5th Circuit ruling, explained

The legal mandate for no-cost health insurance coverage of preventive medicine took a bruising in federal court last week but is still alive — for now.

The U.S. Court of Appeals for the 5th Circuit issued a narrow ruling Friday weakening the provisions of the Affordable Care Act of 2010 that eliminated cost-sharing for screenings, vaccinations, contraception and other services. For now, it applies only to the employers that brought the case in 2021.

Everyone else will carry on as before. But further legal activity is coming, and it could lead to sweeping results that diminish health insurance coverage of services such as birth control, cancer testing and pre-exposure prophylaxis against HIV, known as PrEP.

What is Braidwood Management v. Becerra?

Braidwood Management, Kelley Orthodontics and six individuals seek to invalidate the preventive coverage mandate on two grounds: That services such as PrEP violate their Christian beliefs against homosexuality and that the federal bodies designating what is covered lack Constitutional authority.

Xavier Becerra is a defendant in his role as secretary of Health and Human Services, along with Treasury Secretary Janet Yellen and acting Labor Secretary Julie Su.

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The U.S. District Court for the Northern District of Texas ruled for the plaintiffs on both counts. District Judge Reed O'Connor also ordered a nationwide injunction against the preventive care mandate last year, which the 5th Circuit halted. A variety of healthcare organizations spoke out against the decision at the time.

In 2018, O'Connor ruled the entire ACA was unconstitutional in a separate case, but the Supreme Court overturned that decision in 2021.

What did the 5th Circuit rule?

The clearest outcome of the appeals court decision is that Braidwood Management and Kelley Orthodontics no longer have to offer health benefits to employees that include no-cost coverage of services — including PrEP — that the U.S. Preventive Services Task Force recommended on or after March 23, 2010, which is the date President Barack Obama enacted the ACA.

Under the ACA, most insurance plans are required to cover preventive care endorsed by the U.S. Preventive Services Task Force, the Centers for Disease Control and Prevention's Advisory Committee on Immunization Practices, or the Health Resources and Services Adminstration's Bright Futures program for children and Women’s Preventive Services Initiative. Insurers may not demand cost-sharing for these services.

The 5th Circuit agreed with the lower court that recommendations from the U.S. Preventive Services Task Force should not have the force of law. The ACA did not abide by the Appointments Clause of the Constitution when designating the body an authority on what preventive services must be covered.

Upholding the district court, the appeals court ruled that the task force exercises power that should subject its members to presidential nomination and Senate confirmation. The Agency for Healthcare Research and Quality selects who serves on the panel.

"We agree that the unreviewable power it wields — the power to issue preventive-care recommendations that insurers must cover by law — renders its members principal officers of the United States who have not been validly appointed under Article II of the United States Constitution," Circuit Judge Don Willett wrote in his opinion.

But the 5th Circuit overturned the district court's similar ruling against the Advisory Committee on Immunization Practices and HRSA and referred this question back to O'Connor for further consideration.

The Justice Department did not appeal O'Connor's ruling in 2022 that requiring employers to cover PrEP violated the Religious Freedom Restoration Act of 1993 and the 5th Circuit decision did not address it. O'Connor cited the 2014 Supreme Court ruling that the retailer Hobby Lobby did not have to cover contraception on religious grounds.

What are the effects of the preventive care ruling?

Minimal, said Laurie Sobel, associate director of women’s health policy at the research organization KFF.

“If you're not one of the plaintiffs and you're not an employee of one of the plaintiffs, nothing has changed,” Sobel said. That amounts to about 70 people, she said.

In addition, preventive care recommendations from the Advisory Committee on Immunization Practices and HRSA remain in force for everyone, and there is some overlap between their guidelines and those from the U.S. Preventive Services Task Force, Sobel said.

Health insurance industry organizations emphasized the narrow nature of the 5th Circuit ruling.

"The recent decision does not change coverage of preventive services with no cost-sharing. Preventive care is essential to the health and well-being of the people our members serve and we will continue to monitor any future litigation in this area," the trade association AHIP said in a statement.

“It is great news for patients that the court’s ruling does not broadly impact patient access to these services and Blue Cross and Blue Shield companies will continue to encourage their members to access these services," the Blue Cross Blue Shield Association said in a statement. “We will continue to monitor any further developments to ensure compliance and understand how to best meet our member’s needs.”

The health insurance industry did not seem eager to scrap no-cost preventive medicine when the district court ruled and are unlikely to do so in the near term, Sobel said. But that could change, she said.

Further court rulings could have broader consequences and make insurers and employers rethink how to cover these services. Other businesses may cite the court decisions and seek the same relief granted to Braidwood Management and Kelley Orthodontics.

At least 15 states have laws that mirror the ACA preventive care mandate, according to a 2022 Commonwealth Fund report. Those are unaffected by the federal lawsuit, but states do not have jurisdiction over large-group employer health plans.

The court rulings in this case do not apply to Medicare and Medicaid.

What happens next in the preventive care lawsuit?

The Justice Department can challenge the 5th Circuit decision and Supreme Court may eventually have to weigh in. But that won't happen any time soon, Sobel said. Among other things, elements of the case are back with O'Connor, and the appeals court may intervene again when he rules.

In the meantime, Sobel expects copycat lawsuits from plaintiffs in multiple states, which would set up conflicting rulings from different circuits and ripen the issue for Supreme Court consideration. If the plaintiffs win their arguments against the Advisory Committee on Immunization Practices and HRSA, that would open the door to more lawsuits from opponents of vaccines and contraception.

What if the preventive care mandate is overturned?

Even a $1-$2 cost increase would drive down utilization of preventive medicine and increase spending down the line, said Eric Waskowicz, senior policy manager at United States of Care, which advocates for supporting and expanding the ACA.

Reintroducing cost-sharing or declining to cover certain services would discourage preventive care and increase costs for those who receive it, according to an Employee Benefit Research Institute report published after the district court decision last year.

“If the Braidwood decision were to be upheld and employers reimposed cost-sharing on preventive services that are currently free to enrollees, individuals using those services could face a significant increase in out-of-pocket spending,” the Employee Benefit Research Institute wrote. “Although this potentially onerous financial burden could deter care on the individual beneficiary level and likely worsen health inequities, employers would see little impact on their overall spending," the think tank concluded.

“Poll after poll shows that these no-cost services have been some of the most popular provisions of the ACA,” said Yael Lehmann, interim executive director of the left-leaning healthcare advocacy group Families USA. “We know that without a guarantee of coverage for these services, our nation’s families are more likely to risk their lives and skip critical preventive care due to cost.”