Pension & Benefits News Health care expansion bills offer a window into possible future legislative efforts
Wednesday, October 31, 2018

Health care expansion bills offer a window into possible future legislative efforts

By Pension and Benefits Editorial Staff

The eight legislative proposals currently before Congress to expand health insurance and lower health care costs fall into four broad categories: (1) two proposals to create Medicare-for-all, (2) three proposals to create a public plan option based on Medicare, (3) two proposals to create a Medicare buy-in option for older individuals not yet Medicare-eligible, and (4) one proposal to create a Medicaid buy-in that states would offer, according to a recent Kaiser Family Foundation issue brief. While acknowledging that these Democrat-backed legislative proposals have no chance of advancing in the current congressional session, the issue brief contends that the bills provide an indication of what to expect in future congressional sessions if the leadership changes after the mid-term elections.

Medicare-for-all. Senator Bernie Sanders (I-VT) in the Senate and Rep. Keith Ellison (D-MN) in the House have proposed the most sweeping changes to the current health care system. Under their bills, health care would be provided by a single, federal government-administered program for all U.S. residents. It would replace all other sources of private health insurance and most public programs, including Medicare, Medicare, and CHIP. The program would cover all medically necessary services, with defined categories of benefits to be covered, which would include dental and vision services. Ellison’s bill would also cover long-term services, while Sanders’ bill would use Medicaid to continue to provide LTSS. The Sanders bill would cover all reproductive health services, including abortion, and it would repeal the Hyde Amendment. Both bills would eliminate premiums and cost-sharing, other than limited cost-sharing on prescription drugs. The Sanders bill calls for a four-year phase-in. During the transition, a temporary public plan option, similar to Medicare, would be offered.

Public plan option. The three public plan bills, The Choice Act offered by Rep. Jan Schakowsky (D-IL) in the House and by Sen. Sheldon Whitehouse (D-RI), in the Senate, The Medicare-X Choice Act offered by Sen. Michael Bennet (D-CO) in the Senate and by Rep. Brian Higgins (D-NY) in the House, and The Choose Medicare Act offered by Sen. Jeff Merkley (D-OR) in the Senate and by Rep. Cedric Richmond (D-LA) in the House, would build on, rather than replace, the current system. One bill calls the new option Medicare Part E, one calls it Medicare-X, and the third incorporates Medicare’s features without using the name Medicare. In all three bills, the public plan option would be offered as an alternative to private insurance available through the Affordable Care Act marketplace. In all three bills, the public plan would be eligible for premium and cost-sharing subsidies, and they cover all ACA essential health benefits. All three proposals would also require hospitals, physicians, and other providers that participate in Medicare to participate in the public plan. And all three bills would authorize the HHS Secretary to negotiate drug prices for the public plan.

Medicare buy-in. Sen. Debbie Stabenow (D-MI) and Rep. Brian Higgins (D-NY) have proposed allowing adults age 55-64 (Stabenow bill) or age 50-64 (Higgins bill) the option to buy in to Medicare. The Higgins bill would allow qualifying adults who are eligible for job-based coverage to buy in, with the employer paying the Medicare premiums on their behalf. Under the Stabenow bill, enrollment would have handled by Medicare, while, under the Higgins bill, the buy in would be handled through the marketplace. Both bills would allow marketplace subsidies to apply. In addition, under both bills, the buy-in plan would offer Medicare benefits rather than ACA benefits. Both proposals would require all Medicare-participating providers to participate in the buy-in plan.

State public plan option. Sen. Brian Schatz (D-HI) in the Senate and Rep. Ben Ray Lujan (D-NM) in the House have introduced a bill that would permit a Medicaid public plan option available through the ACA marketplace. For states that elect this option, the plan would allow individuals at all income levels to buy into Medicaid, as long as they are not enrolled in any other coverage. It would be offered as a Silver-level plan in the marketplace. States would receive federal matching payments for any costs for the Medicaid buy-in that are not covered by premiums and cost-sharing payments. The bill would extend current ACA premium and cost-sharing subsidies to those who purchased the buy-in coverage, and it would cap premiums at 9.5 percent of family income. It relies on Medicaid participating providers, including Medicaid managed care organizations, to deliver services.

General impact. The issue brief goes on to address specific health care-related issues such as how the proposals would expand coverage, how the proposals would affect affordability, how the proposals would affect coverage, what the impact would be on employer-provided coverage, and how the proposals would alter Medicare, Medicaid, and CHIP. At present, the Congressional Budget Office has not scored any of the proposals, thus rendering answers to some of these questions little more than speculation. Given the low likelihood of any of these proposals getting anywhere near a vote, most of the speculation seems premature. Perhaps the most interesting aspect is how the proposals would be financed. The issue brief at this early date can do little more than state generally that the cost burden would shift from households and employers to the federal government and taxpayers, and that there would be winners and losers after the changes. Most of the financing details are still to be determined. Nevertheless, these proposals do serve the purpose of raising important considerations that may well be at least debated in future Congressional sessions.


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