Uncertainty emerges in the 2021 health agenda
President Biden’s health policy agenda got off to a quick start but may slow in the coming months. His proposals to expand Affordable Care Act (ACA) premium subsidies and increase Medicaid support for eligibility expansion are popular positions in his party (although not among Republicans), and thus were included in the COVID-19 response plan enacted in March. Other ideas from the 2020 campaign may be too controversial to enact in a closely-divided Congress.
The president ran for office on strengthening the ACA rather than replacing it with Medicare for All or other reforms, and made good on that pledge by pushing for increases in the law’s premium credits and Medicaid coverage in the first major bill of his term. The administration also is seeking to make the premium credit increases — authorized for 2021 and 2022 in the COVID bill — permanent.
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Democrats are discussing several other high-profile reforms for possible inclusion in the infrastructure or family support bills that the president has teed up for congressional consideration, but each faces some opposition, even within the Democratic party.
- Medicare Eligibility at Age 60. President Biden endorsed lowering the age of eligibility for Medicare to 60 during the campaign, and the proposal is popular with voters. The problem is that Medicare is already running short of funds, with the Hospital Insurance trust fund likely to run out of reserves in the next few years. Increasing enrollment in the program would invite a debate on securing program solvency for current beneficiaries, which may make expanding the program challenging.
- Medicare Dental and Vision Coverage. In legislation passed by House Democrats in the last Congress but never taken up in the Senate, Medicare was expanded to include dental and vision benefits. Senator Bernie Sanders is committed to enacting these changes this year, even if the administration is less enthusiastic (President Biden did not include expanding Medicare for these services in his proposed American Families Plan). The price tag may be a barrier too. The Congressional Budget Office estimates the cost at $360 billion over ten years.
- Prescription Drug Pricing. In his recent address to Congress, President Biden endorsed giving the Department of Health and Human Services (HHS) the authority to negotiate pricing for Medicare-covered drugs directly with the pharmaceutical industry. This is a longstanding party priority, and yet the prospects for its enactment are uncertain. Like the eligibility age and Medicare benefit changes, the administration did not include it in its American Families Plan. That raises questions about the president’s willingness to push for its inclusion in an upcoming bill, especially as it would draw fierce opposition from the drug industry.
Enacting this provision also has been made harder by the COVID-19 pandemic. Prominent companies have helped produce the vaccines that are the surest course out of the COVID-19 crisis, and will save millions of lives. U.S.-based research and manufacturing has been instrumental in bringing these vaccines to the country, and the world. Other countries with much stricter pricing regimes are struggling to secure doses. In this environment, it will be difficult to make the case that government-established price limits have no consequences.
- A Public Option. In 2020, then-Vice President Biden talked frequently of creating a new public option to compete with commercial offerings on the ACA exchanges. He offered this idea as a counter to Medicare for All, and was effective in making the case for it. And yet this reform also was left out of the administration’s American Families Plan. While a public option has wide support among Democrats, it only takes a few dissenters to block its path (Republicans will be united in opposition). The administration may have concluded that criticism by the hospital industry would make it too difficult to enact this change with so few Democratic votes to spare in both chambers of Congress.
The one health-related item, beyond ACA expansion, that is getting a push from the administration is expansion of home-and-community-based long-term services and supports through Medicaid. The administration is advocating $400 billion in federal funding for these services as part of its infrastructure plan. It is possible that some version of this plan will be included in legislation taken up by Congress this summer.
President Biden is pursuing one of the most ambitious domestic agendas in the nation’s history, with a focus on permanent expansions in income support programs, educational access, child care support, green energy, and traditional infrastructure. It appears that he and his team have made the political calculation that adding controversial health-care proposals to this mix will only make it harder to secure the rest of the agenda.
Democrats in Congress may have a different view of what is possible. It is clear from recent public statements that many in the party see 2021 as their best chance at securing long-sought health system changes, even if the administration is focused on other matters.
And yet, if the president is not putting his full weight behind the reforms, the likelihood of enactment is not high. There is only so much legislation that any Congress can process in a short period of time. The administration already has secured a major expansion of the ACA and may be content to pocket that victory and move on.
James C. Capretta is a columnist for State of Reform and is a resident fellow at the American Enterprise Institute.