Wednesday, November 04, 2020

A healthcare reform plan for Joe Biden with a Republican Senate

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If, as seems likeliest but by no means certain, we have a President Biden and a retained Republican majority in the Senate, the ACA's core programs are likely to limp along fully funded but not radically improved.

Biden had proposed major reforms to the ACA, including: 1) establishing a public option, 2) allowing those with access to affordable employer-sponsored insurance to buy in to the marketplace on a subsidized basis, 3) capping premiums for a benchmark plan at a maximum 8.5% of income, with no income cap on subsidy eligibility, 4) boosting subsidies at every income level, and 5) offering free marketplace coverage to low income people in states that refused to enact the ACA Medicaid expansion.

None of that is likely to happen. At best, Biden may be able to convince McConnell to render moot Texas v. California, the case before the Supreme Court seeking to have all or part of the ACA declared unconstitutional on patently fraudulent grounds, by either repealing the individual mandate or raising the penalty to $1. 

There's much that can be done to improve the ACA -- and the entire U.S. healthcare system -- administratively, however. And we have a blueprint -- provided by an indefatigable and aggressive reformer with administrative smarts: Elizabeth Warren.

You may recall that during the campaign, Warren jumped through some convoluted hoops to straddle the gap between Medicare for All and more incremental (though still sweeping) and swiftly achievable reform.  

To that end, she released a transitional plan for her prospective first term as president last November. What's relevant now: a sweeping set of proposed administrative actions.  They include:

Use compulsory licensing authority to bypass patents on overpriced essential drugs.

Enforce mental health parity (mandated by the ACA but far from implemented).

Kill current CMS director Seema Verma's illegal ACA innovation waiver guidance and "waiver concepts" encouraging subsidies for medically underwritten plans and other state innovations that will reduce coverage.

Fund ACA outreach/enrollment assistance, cut by 84% by the Trump administration in states using (States that run their own ACA marketplaces have a dedicated income source, user fees charged to insurers participating in the exchange. In states, those fees go to the federal government).

Ban Medicaid work requirements -- currently paused by courts and pandemic, but in the works in some states.

Ban LGBTQ discrimination.

Restore mandatory contraceptive coverage.

Kill the ban on Title X and USAID funding for organizations that perform abortions.

Fix the ACA family glitch (provide subsidies to those for whom employer family coverage is unaffordable) by administrative fiat. 

Expand ACA subsidy eligibility to all legally present noncitizens, e.g. DACA recipients (most but not all legally present noncitizens do have subsidy eligibility, including those who have incomes below 138% FPL but are subject to Medicaid's "5-year bar").

Expand medically necessary dental coverage in Medicare.

Enable states to expand Medicaid eligibility beyond 138% FPL.

Reverse the Trump administration's Medicaid red tape barriers to Medicaid/CHIP coverage, e.g., pressure to run frequent eligibility checks.  

Ramp up antitrust enforcement on hospitals and health systems (everyone says they'd do this, but Warren is committed to real antitrust reform).  

To these I would add one more that could have a major impact on affordability in the ACA marketplace: maximize silver loading, Trump's accidental gift to ACA enrollees, by requiring insurers to price plans at each metal level in accord with the average actuarial value obtained by their enrollees at each metal level. That is, price gold plans below silver plans, which would effectively make gold plans (80% AV) the benchmark at incomes above 200% FPL (below that income threshold, silver plans have 94% or 87% AV). This would probably require changing the risk adjustment formula, which currently favors silver plans. If that all sounds convoluted, it is. Explanations here and here.

Maybe Warren should be HHS Secretary. Except she should be Treasury Secretary. Or best yet, transition chief, to find people who will exhibit this degree of administrative vigor across the federal government.

Sequel: State innovation waivers and new revenue sources

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1 comment:

  1. Thanks for an excellent summary....maybe you should be on the transition team! A few comments:

    1. I do not think that overriding patents is as easy as you make it sound...that would go right to the Supreme Court.

    2. Why not extend subsidies to all incomes? That is actually less expensive than fixing the family glitch.

    3. Adding more abortion coverage is political poison. People like Warren have a real blind spot on this issue. Everyone they know is pro-Abortion, so they have no idea how many abortion opponents there are. I have only been saying this since, oh, about 2009.