The Biden Administration and Health Care

BY CONNER INSURANCE

Between the COVID-19 pandemic and an ongoing political  debate over the Affordable Care Act (ACA), health care was a  core element of Joe Biden’s campaign for the U.S. presidency.  

It remains to be seen exactly how President-elect Joe Biden  and Vice President-elect Kamala Harris will impact the health  care industry. However, employers should begin to consider  how this administration’s platform might affect health care  and employee benefits. This article explores the Biden  administration’s proposed COVID-19 response, general health  care platform and top agenda items.

Health Care Priorities of the Administration

While the Biden administration will inherit the coronavirus  pandemic, it also faces other health care-related challenges.  In addition to addressing COVID-19, the Biden  

administration’s core focus is to expand the ACA  incrementally. 

To this end, Biden’s health care platform will likely require  both executive action and legislation. The administration will  initially inherit a Democratic majority in the U.S. House of  Representatives, but the Republican party is projected to  maintain a majority in the U.S. Senate. Should Biden face a  Republican majority in the Senate, that would impact the  administration’s ability to address health care through  legislation.

COVID-19 Response and Impact on Health Care Biden wants to increase the federal government’s role in the  pandemic and lead a response focused on increased access to  treatment, testing, personal protective equipment (PPE) and,  in some cases, mandates and mitigation strategies. 

The top priorities within the Biden-Harris COVID-19 response  are to: 

  • Increase testing—Expand the number of testing  locations and options to include home and instant  tests, and eliminate out-of-pocket costs. 
  • Address PPE shortages—Use a federal response to  address PPE shortages, and use the Defense  Protection Act (DPA) to increase the availability of  masks and other PPE for communities.
  • Distribute vaccines and treatments—Distribute  vaccines and COVID-19 treatments in a fair and  accessible manner and eliminate out-of-pocket  costs. 
  • Establish additional protections for high-risk and  older Americans—Establish a task force designed to  help equitably distribute COVID-19 resources and  ensure the needs of the elderly and high-risk are  addressed.
  • Work with local authorities on public health  measures—Work with local authorities, including  governors and mayors, to establish and expand mask  mandates, school guidelines and other safety  measures as necessary.
  • Offer federal relief—Provide federal aid that will  prioritize support for small businesses and schools to  operate safely, as well as aid for families.

As the Biden administration addresses the COVID-19  pandemic domestically, it hopes to reestablish the United  States’ relationship with the World Health Organization  (WHO) to integrate the administration’s response with global  efforts.  

Some COVID-19 pandemic response efforts such as federal  mandates will face opposition. However, increased support  via federal aid and initiatives from the federal government to  increase testing, treatment and PPE access are efforts with  broader support. Expect Biden to act on the coronavirus  pandemic in the infancy of his administration.

Biden’s Health Care Agenda 

While the coronavirus pandemic remains a top priority for  both the Biden administration and many Americans, the  administration also hopes to address and expand health care  access. Most of their agenda either fits into or supplements  an expansion of the ACA. However, due to potential  congressional gridlock, employers should be aware that  efforts to expand the ACA, Medicare and Medicaid may run  into some roadblocks. Nonetheless, the following topics will  be priorities for the Biden administration’s health care  agenda. 

ACA 

Currently, the ACA faces challenges in the U.S. Supreme  Court. In the event that it is struck down, the Biden  administration would be expected to work toward a  replacement. However, in the event that the ACA is upheld,  the Biden administration is expected to move forward with  expanding the ACA. These incremental expansions include  offering a public option and expanding Medicaid and  Medicare.  

Public Option 

One of Biden’s core proposals is to offer a public option to compete with private markets. The public option would sit on Marketplace exchanges alongside private plans and be available to the public—even if employers offer coverage. Biden hopes that this option can offer lower prices through price negotiation, cover co-payments for primary care, and improve coordination between patients’ health care providers to improve care.

While Biden hopes this option would offer relief for health care consumers, it would also be intended to offer relief for small businesses, which might no longer need to offer coverage. However, this public option would undoubtedly pose challenges to private insurers, which would be competing against a federally subsidized alternative.

Medicare 

Throughout his campaign, Biden has continually stated that  he intends to lower the Medicare eligibility age from 65 to 60.  If Medicare eligibility were to be granted to those ages 60 to  64, it could increase participation in the program by around 20 million.

Medicaid 

Biden intends to expand coverage to Medicaid at the state  level as some governments and state legislatures have  taken actions against the ACA’s expansion of Medicaid  eligibility. Biden’s plan would seek an expansion aiming to  provide access to almost 5 million additional individuals  who would be eligible for Medicaid. His plan would also  ensure that the proposed public option covers the full  scope of Medicaid benefits. 

States that have already expanded Medicaid would have  the choice of moving the expansion population to the  public option as long as the states continue to pay the cost  of covering those individuals. Biden’s plan would be  intended to ensure that people making below a designated  percentage of the federal poverty level are covered. To  help expand Medicaid participation, he hopes to create  programs that allow automatic enrollment for eligible  participants.

Tax Credits 

Biden hopes to ease the burden on families enrolling in  health care by expanding tax credit eligibility for families who  enroll in coverage through the Marketplace. Current  requirements to receive tax subsidies include a household  income no higher than 400% of the federal poverty level  (FPL). Biden’s plan proposes eliminating the current 400%  income cap on eligibility, offering more families access to  these tax credits.  

Biden also hopes to put a cap on what families pay for health  coverage. He proposes to lower the income cap that a family  puts toward health care premiums from 9.86% to 8.5%. In  Biden’s proposed plan, if a family has employer coverage but 

can get a better deal with the 8.5% cap on their premiums,  they would be eligible to switch to a plan on the Marketplace. 

Drug Pricing  

Biden hopes to lower prescription drug costs for consumers.  The administration’s platform is to: 

  • Allow Medicare drug pricing negotiation—Biden  advocates for requiring drug corporations to negotiate with Medicare over drug prices. Also,  Biden hopes to allow private plans participating in  the Marketplace to access a similar negotiated rate.  Much of this negotiation power may come through  federally managed or sponsored programs such as  the ACA, a new public option within the ACA, Medicare and Medicaid. 
  • Limit drug price increases and monitor new drugs— Biden hopes to limit drug companies’ abilities to  increase prices, which will face some opposition. Biden hopes to establish a board overseeing pricing  that would recommend a reasonable price for new  drugs, based on the average price in other countries  or, if the drug is entering the U.S. market first, based  on an evaluation of independent board members.  This negotiated price would be the rate that Medicare and the public option pay. 
  • Import drugs to save costs—Biden wants to create  cost-savings on drugs by opening up some imports  from foreign markets, using the U.S. Department of  Health and Human Services (DHS) certification  process to ensure safety. While opening up imports  from Canada has drawn some bipartisan interest,  Biden’s platform would seek to expand to additional  markets.

Both the Biden and Trump campaigns acknowledged the  need to address prescription drug prices, and Biden may have  support across the political aisle for some measures.  However, many of Biden’s prescription drug proposals will  face strong opposition in Congress and the private sector.  

Surprise Billing and Pricing Transparency 

Surprise billing occurs when a health care consumer receives  care that is unknowingly not covered under a health care  plan. For example, this can happen if a patient goes to an in network hospital but doesn’t realize that a specialist at that  hospital is not part of their health plan. Biden’s plan to  address this would be to bar health care providers from  charging patients out-of-network rates when the patient  doesn’t have control over which provider they see.  

Generally, ending surprise billing is an initiative with  bipartisan support, as efforts to limit surprise billing were also  part of the Trump campaign.  

Mental Health Care Access

Biden hopes to expand funding for mental health care  through the ACA and reinforce its importance. Biden hopes  to bring parity between mental health and other health,  and ensure the Mental Health Parity and Addiction Equity  Act (MHPAEA) is upheld at the federal and state levels.  

Changes to Health Care 

Health care was a core topic of Joe Biden’s presidential  campaign. As previous administrations have done, this one  should bring forth change as it addresses health care issues  such as the COVID-19 pandemic and the future of the ACA.  

Conner Insurance will keep you updated on any noteworthy  health care and employee benefits changes. Contact us for  additional health care and employee benefits resources.