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Q&A on what the looming Supreme Court ACA decision may mean for the health industry


May 11, 2021

Sundar Subramanian
Principal, PwC US

With the US Supreme Court slated to issue a decision this spring in a pivotal case challenging the constitutionality of the Affordable Care Act (ACA), PwC’s Health Research Institute (HRI) spoke with PwC principal Sundar Subramanian about the uncertainty the legal challenges have brought to the healthcare industry, where portions of the 11-year-old law have become deeply embedded in the business models of health organizations.

PwC Health Research Institute (HRI)

The most recent projections from the Urban Institute suggest that the number of uninsured Americans could grow by 21 million in 2022 if the ACA is struck down entirely this year. As HRI pointed out in its analysis of a proposed repeal of the ACA in 2017, the 2010 law doesn’t just affect coverage; it touches a wide swath of the US health industry, expanding the categories of hospitals allowed to participate in the 340B program—for example, establishing a regulatory pathway for biosimilars, creating an excise tax on nonmedical UV-light tanning, and much, much more. Can you talk about how health organizations are approaching the uncertainty surrounding the fate of the law?

Sundar Subramanian, PwC principal

The question is what happens to coverage for these millions of individuals who purchase insurance through the ACA exchanges today. It’ll be damaging for the ecosystem and society to leave these individuals uninsured. 

What is unclear is what would be the replacement option that actually materializes. Some of the newly uninsured could be picked up by the employer market or Medicaid, but there will need to be a more substantial replacement option, so hopefully they would not be left uninsured. 

Healthcare organizations will need to continue to plan and prepare as if the ACA stays and need to scenario plan the implications in case anything different happens.

HRI: Do you think a decision striking down the ACA would slow innovation in the industry or accelerate it?

Sundar Subramanian: The horse is out of the barn in terms of innovation. We will continue to see the innovation and the evolution to more digital health ecosystems focused on improving healthcare delivery and consumer experience using technology, data, AI, no matter what. For instance, the employer-sponsored insurance market is very ripe for some of these disruptive changes, and that will continue to be the case. One would certainly expect that the digital world, too, would help enable the ecosystem model to make it easier to access care and provide for these individuals.

I would say that no matter what, these dynamics are going to happen. If the law is struck down, you will have to wait and watch closely for what’s the replacement option to the ACA in order to capture those individuals through a different ecosystem in terms of the organizations.

HRI: In our “Top Health Industry Issues of 2021” report, we talk about the importance of resiliency. What steps can health organizations take to better position themselves in this uncertain environment?

Sundar Subramanian: The strategic planning processes in these organizations need to build in some scenario planning and resilience in that portfolio. While there is some natural advantage or cushion to players who are more exclusively playing in the employer space or Medicare or Medicaid alone, I do believe that business models that are highly differentiated will ultimately stand the test of time. 

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