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Why Georgia’s move to new health insurance program might face legal challenges
1221 Health
The Healthcare.gov website is seen on a laptop computer in Washington. - photo by Associated Press

Georgia has gotten federal approval to offer federally subsidized health insurance through private vendors instead of a state insurance marketplace, but one local insurance provider said tricky waters could lie ahead. 

“The unknown on this plan is the fact that this new program is a waiver from normal federal law that is being approved by President Trump’s administration,” said Rob Fowler, CEO and partner with Turner, Wood and Smith in Gainesville. "If Trump is not re-elected, I would assume the Biden administration could overturn the waiver.” 

Also, Fowler noted that Georgia’s “reinsurance” plan – announced Sunday, Nov. 1, by the Centers for Medicare & Medicaid Services – “could face a court challenge if it decreases overall enrollment, because a decrease would violate” the federal Affordable Care Act, which paved the way for federal and state marketplaces. 

Health Affairs, a Maryland-based health policy thinktank, also noted legal challenges may occur. 


“Some have argued that Georgia’s proposal fails to meet the statute’s procedural and substantive guardrails and thus should not be approved,” the organization says on its website. “Commenters on the proposal raised similar concerns about the potential for coverage losses, the steering of consumers to non-ACA plans and consumer confusion during and after the transition away from HealthCare.gov.” 

CMS Administrator Seema Verma said in a statement that “approval of the state’s waiver will usher in a groundswell of health care innovation that will deliver lower costs, better care and more choice to Georgians in the individual market.” 

Georgia would be the first state where residents would buy insurance directly from brokers or insurers on sites where they would be able to compare plans that meet the requirements of the ACA — President Barack Obama's signature health law — with those that don't. 

Kemp’s administration says private brokers or websites will provide better service and offer more options that will boost insurance coverage. 

Critics worry the move will make it harder to shop for insurance and drive healthy people to cheaper plans that provide limited coverage, increasing insurance premiums for older and sicker people who need the comprehensive benefits required by the ACA. 

Passed in 2010, the ACA extended insurance coverage to millions of Americans by expanding Medicaid and subsidizing premiums for individuals and families who make up to four times the federal poverty level. Georgia has separately received permission for a limited Medicaid expansion. 

The move away from Healthcare.gov would occur in 2023. A year before that, the state would implement another part of its ACA plan that would pay a portion of insurance companies’ costs to treat their sickest patients, a relatively small group that incurs the biggest bills. The so-called reinsurance program would allow the companies to lower monthly premiums for all customers, a particular benefit for those who don’t qualify for federal subsidies to cover premiums. 

But the state will need to contribute an estimated $92 million for that program in its first year — money that has yet to be approved. 

The Associated Press contributed to this report. 

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