Will the Supreme Court Fast Forward Health Insurance Reform in 2020?

The year 2020 has gotten off to a flying start—probably a direct consequence of 2019 finishing with a flurry. One of the first eye-catching bits of news was the request by several states for the Supreme Court to intervene now, not later, in the case that threatens the fundamental basis on which the biosimilar pathway is based.

As reported in December, the Fifth District Court affirmed the ruling that the individual mandate was invalid. However, it sent back to Texas District Court Justice Reed O’Connor the decision as to whether the individual mandate is “severable” from the rest of the Affordable Care Act. In other words, if the individual mandate is cut from the ACA, does that mean that all other aspects of this legislation, including the biosimilar pathway created by the BPCIA, must also be declared invalid?

In Judge O’Connor’s original decision, he took the broadest view, stating that if the individual mandate has been withdrawn, then the entire ACA is invalid. One wonders why the Fifth District Court of Appeals thinks that Judge O’Connor will reconsider his logic. If he doesn’t, the case winds up in the Supreme Court, sooner or later.

The attorneys general of 20 states and the District of Columbia  want that to be sooner, which makes sense. Let’s get a final ruling for the sake of US citizens and the entire healthcare system. If a workaround or a complete recontemplation of health reform needs to be done, it would be far better to find that out now, in time for the next elections (assuming that a Supreme Court decision is issued in early Fall of this year). If Medicaid expansion must be rolled back, if the exchanges must be invalidated, and if biosimilars made available to the public must be withdrawn, that could have a huge impact on the upcoming elections. That cannot happen, of course, unless the Supreme Court hears the case before this year’s session is complete.

This may be viewed in a couple of ways: (1) an opportunity/attempt by Democrats to more seriously introduce a public option or even Medicare for all, (2) an opening for Democrats to exploit that the health insurance of 20 million Americans will be immediately at stake in the upcoming elections, (3) an opportunity for Senate Republicans and the Trump administration to demonstrate real leadership in the next phase of health reform (i.e., one that does not reflect any of the lack of understanding of preexisting conditions/chronic disease/patient cost sharing demonstrated in their earlier statements on health reform), or (4) a chance for the administration shoot itself in the foot on the greater healthcare issue one more time.

The Trump administration sides with those who seek to repeal the ACA at any cost; it elected to not defend the law in the current case. The partisan divide between the House and the Senate does not inspire confidence that a quick fix can be implemented to restore by statute the needed parts of the ACA and BPCIA. Consider the nightmare of having to debate once again—from scratch—the foundational pillars of providing affordable, comprehensive health insurance to Americans. Who wants to revisit that exercise in today’s contentious environment?

The Baby, Biosimilars, and the Bath Water

You’ve heard the expression, “throwing the baby out with the bath water.” It refers to the problem of unintended consequences of our actions.

On December 14, Texas District Court Judge Reed O’Connor decided that when he ruled that the individual mandate of the Patient Protection and Affordable Care Act (ACA) is unconstitutional, the entire Act is also invalid. If affirmed, this doomsday scenario may well mean that all of the provisions of the Act are to be repealed.

Texas District Court
Texas District Court Judge Reed O’Connor

One crucial piece of legislation incorporated into the ACA is the BPCIA—the Biologics Price Competition and Innovation Act, on which the biosimilar regulatory pathway is founded. Yes, if the appeals are upheld and the US Supreme Court affirms the decision, the last 7 years of progress made in creating a competitive environment for biosimilars could be jeopardized.


President Trump has stated to reporters that he was happy with the decision of the Texas District Court and hopes that the Supreme Court will not overturn it. His perspective might be different if he thought through the full implications of the action. The repeal will directly affect the 17 million people who receive their health insurance through the ACA, either through the exchanges or expansion of state Medicaid programs.

The unintended consequences of a full repeal of the ACA without any comparable replacement will affect not only work done in biosimilar development and regulation in the US, but also by the Centers for Medicare and Medicaid Innovation (i.e., accountable care organizations and value-based contracting) but closing the Medicare part D coverage gap, the Patient-Centered Outcomes Research Institute (to conduct comparative-effectiveness research), and work done to advance prevention in public health.

In fact, many of the provisions of the ACA are supported by broad consensus. For one, discriminating against people with preexisting conditions, through either exclusions or higher rates. Although the Republicans have not credibly defended this concept by their past actions, they do profess to believe in it.

The potential benefits of a value-based health system is another area where all political parties seem to agree. Hope springs eternal that outcomes-based payments, reimbursements that include shared savings, and bundled or global contracts will improve our care quality and efficiency.


Those who understand the intent of the BPCIA believes that it will result in significantly lower drug costs, at least in the long term. A spokesperson for the Association for Affordable Medicines told BR&R in an E-mail, “As Congress and the Courts respond to last week’s ruling, it’s important to remember that the biosimilars pathway remains one of the least controversial aspects of the Affordable Care Act. All stakeholders agree on the need to maintain this critical aspect of the law. Without it, patient access to biosimilar medicines would be jeopardized.”


Just last week, the trade association America’s Health Insurance Plans applauded the Trump administration for releasing draft guidances that begin moving transitional drugs to biosimilar status in 2020 and for its efforts to reduce biologic drug pricing in general.

Of course, a number of reasonable scenarios may yet occur to prevent the loss of our baby. The Texas District Court ruling may be overturned on appeal, the Supreme Court may overturn it outright, or the Supreme Court may apply it specifically to the individual mandate (allowing all other ACA provisions to remain). The process has already begun—attorneys general from 17 states filed on December 17 for an expedited appeal by the Fifth Circuit Court of Appeals.

The Trump administration has staked much on its promises to improve drug access and lower pharmaceutical costs. However, the President’s positive comments on District Court ruling directly conflict with the actions of the Department of Health and Human Services (e.g., Secretary Alex Azar and FDA Commissioner Scott Gottlieb).

If the worst-case scenario comes true, which I personally believe is unlikely, will new legislation have to be proposed and enacted to preserve our ability to evaluate and approve biosimilar agents? Will the FDA be prohibited, in the meantime, from progressing with existing biosimilar drug reviews? These questions must be considered, because our ideas of what is realistic are being sorely tested. This baby’s health must be protected from this ruling’s unintended consequences.