A lawsuit that has the support of the Trump Administration may bring back the practice of denying insurance coverage for pre-existing conditions. Should the lawsuit succeed in its attempt to overturn consumer protections that prevent insurers from excluding Americans with pre-existing conditions, some states are going to feel the impact more than others.

A new report from the Commonwealth Fund looks at the possible consequences of the lawsuit, which claims that since the individual mandate provision of the Affordable Care Act was eliminated by last year's tax cut legislation, the other provisions of the health care law must be found unconstitutional.

Even though some legal experts say the lawsuit is unlikely to prevail, the fact that 20 states signed on means that there is a not-insignificant chance that all the consumer protections of the ACA will be lost if the law is overturned.

The Commonwealth Fund study finds that 38 states have no state regulations requiring insurers to cover people with pre-existing conditions, or would end such protections if the ACA is repealed or found unconstitutional. Other states have some degree of protection on the books, but in varying degrees.

Only four states in the US have adopted all three protections afforded by the ACA: guaranteed issue (plans cannot reject applicants based on health status); adjusted community rating (plans cannot charge higher premiums based on health status), and a prohibition on pre-existing condition exclusions.

“Prior to the ACA, standards to protect people with pre-existing conditions were primarily determined at the state level, and most states had very limited protections. Indeed, before the ACA, many insurers maintained lists of up to 400 different conditions that would potentially disqualify applicants from insurance or result in their being charged higher premiums,” the report notes. “As many as 35 percent of people who tried to buy insurance on their own were either turned down by an insurer, charged a higher premium, or had a benefit excluded from coverage due to a pre-existing health problem. Many will face these challenges again if the federal law's pre-existing condition protections are stripped away by the court.”

Complicating the situation are ERISA law regulations, which make self-funded employer plans exempt from state regulatory laws. So even if states take steps to require coverage for those with pre-existing conditions, some employer-based plans would still be able to exclude employees. The ACA explicitly included self-insured plans; that protection would be ended if the law is overturned.

In all, the loss of the consumer protections could have a huge impact on health insurance coverage in the US. The Urban Institute released a study in June estimating that the number of uninsured Americans would increase by more than 17 million if the entire ACA was found unconstitutional by the courts.

The issue could be a potent one in November's elections. Even though the ACA has been controversial, American voters have expressed strong support for the requirement to cover people with pre-existing conditions. In a recent Kaiser Family Foundation poll, 68 percent of registered voters said that continuing protections for those with pre-existing conditions was the most important, or a very important factor when it comes to how they will vote in upcoming elections.

The Commonwealth study notes that even though some legal experts are dubious about the lawsuit, it's still not clear how courts will eventually rule. “Should the case against the federal pre-existing condition protections eventually prevail, the effect on consumers will depend largely on how states respond,” the study says. “More states may want to take steps to solidify these protections and shield their residents from ongoing efforts to strip them away.”

Instant Insights /

Impact of pre-existing-condition coverage lawsuit depends on where you live

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