Article: Christine H. Monahan, Private Enforcement of the Affordable Care Act: Toward an “Implied Warranty of Legality” in Health Insurance, 126 Yale L. Rev. 908 (2017).
For decades, the individual health insurance market failed to provide consumers adequate or affordable health coverage. The Affordable Care Act (ACA) sought to change this state of affairs, establishing a new Patient’s Bill of Rights and instituting other protections that require insurers to make comprehensive coverage readily accessible. However, recent reports have begun to document health plans’ violations of the ACA, such as their failure to pay consumers their required refunds or the illegal imposition of waiting periods for transplant services. Although the ACA preserves a role for states in implementing and enforcing the law, state remedies are often lacking. For instance, many state consumer protection laws do not apply to insurance, while traditional breach of contract claims only provide for recourse when a health insurance policy expressly incorporates ACA provisions. As a result, a critical gap in the law has come to light: the absence of a private right of action. This Note proposes that state courts can address this gap by finding that the sale of individual health insurance comes with an implicit and legally enforceable promise that the policy and insurer administering it are in full compliance with the ACA. In other words, this Note urges courts to establish an “implied warranty of legality” in the context of individual health insurance. Modeled on the implied warranty of habitability, this approach would correct for power imbalances within this market. It would also promote individual rights by empowering consumers to sue when they have been wronged and foster civic engagement by enabling consumers to play an active role in the enforcement of public law. The implied warranty of legality would also have redistributive effects, allowing for the costs of noncompliance to be shared more evenly across the market. Looking beyond the ACA, the implied warranty of legality should also be applied in other regulated markets with similar dynamics, or, if the ACA is scaled back or repealed, to enforce state health insurance rules that seek to protect consumers from unlawful insurer practices.