President Joe Biden is expected to sign executive actions this week related to immigration, healthcare and climate, according to a memo obtained by The Hill.
The executive actions would follow 10 he signed Jan. 21 to combat COVID-19 spread.
Here are the three healthcare executive actions to expect Jan. 28, according to The Hill:
1. President Biden is set to rescind a policy banning foreign aid for abortion, known as the Mexico City policy. It prohibits the use of U.S. funds for foreign and national health organizations that perform or actively promote abortion, according to NBC News. The policy was announced by former President Ronald Reagan in 1984. According to The Hill, it has been rescinded by Democratic presidents and reinstated by Republican presidents, including former President Donald Trump, since then.
2. President Biden will also call for a review of the Title X family planning program, according to a memo obtained by The Hill. The federal program provides family planning and related preventive health services for low-income or uninsured people and others. In 2019, the Trump administration issued a final rule prohibiting providers that receive federal family planning money under the program from providing or promoting abortions. NBC News reported that the Biden administration is expected to back off this rule and “restore federal funding for Planned Parenthood,” which left the program in 2019.
3. President Biden plans to sign an executive action on Medicaid and initiate an open enrollment period under the ACA, according to a memo obtained by The Hill. The annual open enrollment period for 2021 closed in December. However, President Biden could initiate a special enrollment period.
President Biden is scheduled to take executive actions as early as Thursday to reopen federal marketplaces selling Affordable Care Act health plans and to lower recent barriers to joining Medicaid.
The orders will be Biden’s first steps since taking office to help Americans gain health insurance, a prominent campaign goal that has assumed escalating significance as the pandemic has dramatized the need for affordable health care — and deprived millions of Americans coverage as they have lost jobs in the economic fallout.
Under one order, HealthCare.gov, the online insurance marketplace for Americans who cannot get affordable coverage through their jobs, will swiftly reopen for at least a few months, according to several individuals inside and outside the administration familiar with the plans. Ordinarily, signing up for such coverage is tightly restricted outside a six-week period late each year.
Another part of Biden’s scheduled actions, the individuals said, is intended to reverse Trump-era changes to Medicaid that critics say damaged Americans’ access to the safety-net insurance. It is unclear whether Biden’s order will undo a Trump-era rule allowing states to impose work requirements, or simply direct federal health officials to review rules to make sure they expand coverage to the program that insures about 70 million low-income people in the United States.
The actions are part of a series of rapid executive orders the president is issuing in his initial days in office to demonstrate he intends to steer the machinery of government in a direction far different from that of his predecessor.
Biden has been saying for many months that helping people get insurance is a crucial federal responsibility. Yet until the actions planned for this week, he has not yet focused on this broader objective, shining a spotlight instead on trying to expand vaccinations and other federal responses to the pandemic.
The most ambitious parts of Biden’s campaign health-care platform would require Congress to provide consent and money. Those include creating a government insurance option alongside the ACA health plans sold by private insurers, and helping poor residents afford ACA coverage if they live in about a dozen states that have not expanded their Medicaid programs under the decade-old health law.
A White House spokesman declined to discuss the plans. Two HHS officials, speaking on the condition of anonymity about an event the White House has not announced, said Monday they were anticipating that the event would be held on Thursday.
According to a document obtained by The Washington Post, the president also intends to sign an order rescinding the so-called Mexico City rule, which compels nonprofits in other countries that receive federal family planning aid to promise not to perform or encourage abortions. Biden advisers last week previewed an end to this rule, which for decades has reappeared when Republicans occupied the White House and vanished under Democratic presidents.
The document also says Biden will disavow a multinational antiabortion declaration that the Trump administration signed three months ago.
The actions to expand insurance through the ACA and Medicaid come as the Supreme Court is considering two cases that could shape the outcome. One case is an effort to overturn rulings by lower federal courts, which have held that state rules, requiring some residents to work or prepare for jobs to qualify for Medicaid, are illegal. The other case involves an attempt to overturn the entire ACA.
According to the individuals inside and outside the administration, the order to reopen the federal insurance marketplaces will be framed in the context of the pandemic, essentially saying that anyone eligible for ACA coverage who has been harmed by the coronavirus will be allowed to sign up.
“This is absolutely in the covid age and the recession caused by covid,” said a health-care policy leader who has been in discussions with the administration. “There is financial displacement we need to address,” said this person, who spoke on the condition of anonymity to describe plans the White House has not announced.
The reopening of HealthCare.gov will be accompanied by an infusion of federal support to draw attention to the opportunity through advertising and other outreach efforts. This, too, reverses the Trump administration’s stance that supporting such outreach was wasteful. During its first two years, it slashed money for advertising and for community groups known as navigators that helped people enroll.
It is not clear whether restoring outreach will be part of Biden’s order or will be done more quietly within federal health-care agencies.
Federal rules already allow people to qualify for a special enrollment period to buy ACA health plans if their circumstances change in important ways, including losing a job. But such exceptions require people to seek permission individually, and many are unaware they can do so. Trump health officials also tightened the rules for qualifying for special enrollment.
In contrast, Biden is expected to open enrollment without anyone needing to seek permission, said Eliot Fishman, senior director of health policy for Families USA, a consumer health-advocacy group.
In the early days of the pandemic, the health insurance industry and congressional Democrats urged the Trump administration to reopen HealthCare.gov, the online federal ACA enrollment system on which three dozen states rely, to give more people the opportunity to sign up. At the end of March, Trump health officials decided against that.
During the most recent enrollment period, ending the middle of last month, nearly 8.3 million people signed up for health plans in the states using HealthCare.gov. The figure is about the same as the previous year, even though it includes two fewer states, which began operating their own marketplaces.
Leaders of groups helping with enrollment around the country said they were approached for help this last time by many people who had lost jobs or income because of the pandemic.
The order involving Medicaid is designed to alter course on experiments — known as “waivers” — that allow states to get federal permission to run their Medicaid programs in nontraditional ways. The work requirements, blocked so far by federal courts, are one of those experiments. Another was an announcement a year ago by Seema Verma, the Trump administration’s administrator of the Centers for Medicare and Medicaid Services, that states could apply for a fundamental change to the program, favored by conservatives, that would cap its funding, rather than operating as an entitlement program with federal money rising and falling with the number of people covered.
“You could think about it as announcing a war against the war on Medicaid,” said Katherine Hempstead, a senior policy adviser at the Robert Wood Johnson Foundation.
Dan Mendelson, founder of Avalere Health, a consulting firm, said Biden’s initial steps to broaden insurance match his campaign position that the United States does not need to switch to a system of single-payer insurance favored by more liberal Democrats.
The orders the president will sign “are going to do it through the existing programs,” Mendelson said.
As one of his first official actions upon taking office Wednesday, President Biden signed an executive order implementing a federal mask mandate, requiring masks to be worn by all federal employees and on all federal properties, as well as on all forms of interstate transportation. Yesterday Biden followed that action by officially naming his COVID response team, and issuing a detailed national plan for dealing with the pandemic. Describing the plan as a “full-scale wartime effort”, Biden highlighted the key components of the plan in an appearance with Dr. Anthony Fauci and COVID response coordinator Jeffrey Zients.
The plan instructs federal agencies to invoke the Defense Production Act to ensure adequate supplies of critical equipment, including masks, testing equipment, and vaccine-related supplies; calls for new nationalguidelines to help employers make workplaces safe for workers to return to their jobs, and to make schools safe for students to return; and promises to fully fund the states’ mobilization of the National Guard to assist in the vaccine rollout.
Also included in the plan is a new Pandemic Testing Board, charged with ramping up multiple forms of COVID testing; more investment in data gathering and reporting on the impact of the pandemic; and the establishment of a health equity task force, to ensure that vulnerable populations are an area of priority in pandemic response.
But Biden can only do so much by executive order. Funding for much of his ambitious COVID plan will require quick legislative action by Congress, meaning that the administration will either need to garner bipartisan support for its proposed “American Rescue Plan” legislation, or use the Senate’s budget reconciliation process to pass the bill with a simple majority (with Vice President Harris casting the tie-breaking vote). Even that may prove challenging, given skepticism among Republican (and some moderate Democratic) senators about the $1.9T price tag for the legislation.
We’d anticipate intense bargaining over the relief package—with broad agreement over the approximately $415B in spending on direct COVID response, but more haggling over the size of the economic stimulus component, including the promised $1,400 per person in direct financial assistance, expanded unemployment insurance, and raising the federal minimum wage to $15 per hour.
Some of the broader economic measures, along with the rest of Biden’s healthcare agenda and his larger proposals to invest in rebuilding critical infrastructure, may have to wait for future legislation, as the administration prioritizes COVID relief as its first—and most important—order of business.
Beyond the initiatives directly tied to COVID relief, President Biden’s healthcare agenda includes a broader bolstering of the protections and coverage mechanisms in the Affordable Care Act (ACA), as well as the rollback of several of the previous administration’s regulatory changes. We’ve outlined that agenda in the graphic below, as well as highlighting key members of the Biden healthcare team.
While much will depend on how the COVID pandemic continues to unfold, and how successful Biden is at striking bipartisan compromises with a closely divided Congress, we’re watching closely for the answers to several key questions:
(1) how aggressive can and will the new administration be in unwinding Trump-era reforms, particularly regarding Medicaid work requirements;
(2) what will be the thrust of Biden’s antitrust policyin the healthcare space;
(3) how hard will Biden be willing to push for expanded subsidies for individuals purchasing insurance on the ACA exchanges;
(4) how will the Biden team build on the transparency measures implemented by the Trump administration; and
(5) how will the new administration use payment reforms and other regulations to address racial and other disparities in healthcare?
All of that preceded by one burning question that has us holding our breath: who will Biden pick to run the all-important Centers for Medicare and Medicaid Services?
On January 14, 2021, Planned Parenthood Southeast and the Feminist Women’s Health Center filed a lawsuit challenging the Trump administration’s approval of Georgia’s waiver under Section 1332 of the Affordable Care Act (ACA). The lawsuit was filed in federal district court in DC. This post summarizes that legal challenge as well as parts of President Biden’s recent proposed pandemic relief package that relate to the ACA and coverage. The $1.9 trillion American Rescue Plan includes several coverage-related proposals and would follow the pandemic relief passed by Congress in December 2020.
Advocates Challenge The Approval of Georgia’s 1332 Waiver
Regular readers know that the Trump administration—through the Centers for Medicare and Medicaid Services (CMS) and the Treasury Department—approved a broad waiver request from Georgia under Section 1332 of the ACA. The approved waiver authorizes the state to establish a reinsurance program for plan year 2022 and eliminate the use of HealthCare.gov beginning with plan year 2023. CMS and Treasury approved the waiver application on November 1, 2020. The history of Georgia’s waiver application and approval is summarized in prior posts as well as in the complaint filed in the lawsuit.
The reinsurance portion of the waiver is straightforward; of the 16 states with an approved Section 1332 waiver, all but one state has established a state-based reinsurance program. But the second part of the waiver application, known as the Georgia Access Model, is far more controversial. This is the broadest waiver yet to be approved under Section 1332 and relies on interpretations of Section 1332 made in much-criticized Trump-era guidance from 2018.
Critics have long argued that Georgia’s proposal fails to satisfy Section 1332’s procedural and substantive guardrails, meaning it could not be lawfully approved by the Trump administration. Given this controversy, legal challenges to the waiver approval were expected.
The Lawsuit
Planned Parenthood Southeast and the Feminist Women’s Health Center—represented by Democracy Forward—filed a lawsuit in federal district court in DC on January 14, 2021. The lawsuit alleges that the Trump administration’s 2018 guidance and approval of Georgia’s waiver are unlawful because these actions violate Section 1332 of the ACA and the Administrative Procedure Act (APA). The lawsuit also cites many of the Trump administration’s ongoing efforts to undermine the ACA as evidence that the 2018 guidance and waiver approval are part of a pattern of ACA sabotage.
In particular, the plaintiffs argue that the 2018 guidance and waiver approval are contrary to Section 1332, exceed the scope of the agencies’ authority (by allowing states to waive non-waivable provisions of the ACA), and are arbitrary and capricious. They also argue that the waiver approval failed to satisfy procedural requirements under the ACA and APA because Georgia and the Trump administration “rushed through the process without adequate time for public comment and without adequate clarification of how the state intends to approach key issues.” Here, the lawsuit points to the fact that Georgia went through four iterations of its waiver application, that its application was incomplete, and that only eight comments (less than one half of one percent) of the 1,826 total comments submitted during the most recent federal public comment period were in support of the Georgia Access Model.
As such, the plaintiffs ask the court to vacate both the approved waiver and the 2018 guidance and declare that they are unlawful. They also ask that the federal government be enjoined from taking further action on Georgia’s waiver or considering other waivers under the 2018 guidance. The plaintiffs acknowledge that the reinsurance portion of the waiver is uncontroversial and that the focus of the lawsuit is on the Georgia Access Model; however, the plaintiffs challenge approval of the waiver as a whole and ask the court to set aside the waiver in whole or in part. The plaintiffs have not sued Georgia, although it is possible that Georgia may ask to intervene in the litigation to defend its interests.
Much of the lawsuit turns on how the Trump administration interpreted the statutory guardrails under Section 1332 and long-standing concerns about direct enrollment and enhanced direct enrollment.Federal officials can grant a Section 1332 waiver only if a state demonstrates that their proposal meets certain statutory “guardrails.”These guardrails ensure that a waiver proposal will 1) provide coverage that is at least as comprehensive as ACA coverage ( “comprehensiveness” guardrail); 2) provide coverage and cost-sharing protections that are at least as affordable as ACA requirements (“affordability” guardrail); 3) provide coverage to at least a comparable number of residents as under the ACA ( “coverage” guardrail); and 4) not increase the federal deficit. The Obama administration issued guidance in 2015 on its interpretation of these guardrails.
In 2018, the Trump administration replaced that guidance and adopted its own interpretation, which manyargued was inconsistent with Section 1332. The 2018 guidance tried to pave the way for the Trump administration to approve waivers where only some coverage under the waiver (instead of all coverage) satisfied the comprehensiveness and affordability guardrails. Under this view, waivers could be approved even if only some coverage under the waiver was as comprehensive, as affordable, and as available as coverage provided under the ACA. The 2018 guidance would also allow waivers to expand access to plans that do not have to meet the ACA’s requirements. (Separately, the Trump administration issued a final rule to codify the 2018 guidance’s interpretations into regulations.)
The lawsuit argues that the Georgia Access Model violates all four statutory guardrails because it will “drastically underperform the ACA.” The waiver proposal could lead to net enrollment losses in Georgia, which violates the coverage guardrail. The waiver could lead some consumers to enroll in non-ACA plans (such as short-term plans) with benefit gaps, which violates the comprehensiveness guardrail. And consumers will have to pay higher premiums and out-of-pocket costs through higher broker commissions, reduced competition, and adverse selection against the ACA markets, which violates the affordability guardrail and potentially the deficit neutrality guardrail (since higher ACA premiums mean higher federal outlays in the form of premium tax credits).
As health care providers in Georgia, Planned Parenthood Southeast and the Feminist Women’s Health Center allege they will be harmed for several reasons. They argue that the Georgia Access Model will make it more difficult and expensive for their patients to obtain health insurance. Fewer patients with health insurance will result in higher levels of uncompensated care. More uncompensated care will strain the plaintiffs’ resources and limit other services, such as community outreach. The loss of coverage resulting from the waiver will leave their patients in worse health and develop more complex treatment needs, making it more expensive for plaintiffs to treat those patients as a result. And approval of the waiver will make it more complicated for the plaintiffs to assist their patients with enrollment.
What Happens Next
The lawsuit was assigned to Judge James E. Boasberg of the federal district court for DC. Health policy watchers know Judge Boasberg as the judge who repeatedly invalidated the Trump administration’s approval of state Section 1115 waivers with work and community engagement requirements. He is thus no stranger to assessing the legality of waiver approvals under the APA and other federal statutes.
The lawsuit will proceed, and the Biden administration will be responsible for filing a response in court. One potential option could be for the Biden administration to ask the court for a stay while it revisits the approved waiver and perhaps holds another round of public comment on the most recent version of the waiver (which, as the lawsuit points out, was never submitted for public comment). The Biden administration could consider any new comments in reevaluating approval of the Georgia Access Model.
If the federal government newly concludes that the proposal fails to satisfy the substantive guardrails, it could have grounds to amend, suspend, or terminate Georgia’s waiver, so long as certain procedures are followed. This is because the terms and conditions of the waiver agreement between the federal government and Georgia (as well as implementing regulations) always give the federal government “the right to suspend or terminate a waiver, in whole or in part, any time before the date of expiration, if the Secretaries determine that the state materially failed to comply with the terms” of the waiver.
Georgia’s waiver agreement includes some unique terms and conditions relative to waivers in other states. Those terms seem designed to limit the federal government’s ability to suspend or terminate Georgia’s waiver. But the federal government can do so as long as it complies with relevant procedures. This includes notifying Georgia of its determination, providing an effective date, and citing reasons for the amendment or termination (i.e., why the Georgia Access Model fails to satisfy Section 1332’s substantive guardrails). Georgia would have 90 days to respond, with the possibility of providing a corrective action plan to come into compliance with the waiver conditions. Georgia must also be given an opportunity to be heard and challenge the suspension or termination.
Alternatively, the Biden administration could regularly assess and monitor the state’s compliance with the terms and conditions and its progress, or lack thereof, in implementing the Georgia Access Model. Federal officials do this with all waivers. Under the waiver approval, Georgia must, for instance, satisfy requirements related to funding, reporting and evaluation, development of an outreach and communications plan, and operational standards for eligibility determinations. If Georgia fails to comply with these terms and conditions, that too would be grounds to initiate the process to amend or terminate parts or all of Georgia’s waiver.
Coverage Provisions In Biden’s American Rescue Plan
On January 14, a few days before taking office, President Biden issued a 19-page fact sheet outlining his proposed American Rescue Plan to contain the COVID-19 virus and stabilize the economy. The announcement praised the bipartisan package adopted in December 2020 as “a step in the right direction” but notes that Congress did not go far enough to fully address the pandemic and economic fallout. Following Inauguration Day, Biden is expected to lay out an additional economic recovery plan.
Among many other initiatives, the comprehensive $1.9 trillion plan would provide funding for a national vaccination program, create a new public health jobs program, provide funding for schools to reopen safely, extend and expand emergency paid leave, extend and expand unemployment benefits, raise the minimum wage, and deliver $1,400 in support for people across the country. The Biden plan also calls for preserving and expanding health insurance, noting that 30 million people were uninsured even before the pandemic and that millions may have lost job-based coverage in 2020.
First, the American Rescue Plan calls for Congress to provide COBRA subsidies through the end of September. Presumably, these subsidies would be available from the beginning of 2021, rather than subsidizing premiums from 2020. COBRA subsidies during an economic emergency are not new. Congress subsidized COBRA premiums during the 2008 recession, with mixed results. Full COBRA subsidies were included in the original Heroes Act passed by the U.S. House of Representatives in May 2020, although not in the revised Heroes Act that was passed by the House in October 2020. But neither bill was ever taken up by the U.S. Senate. It is not clear from the fact sheet whether the Biden administration is aiming for full COBRA subsidies where the government would pay 100 percent of the premiums for COBRA coverage for laid-off workers and furloughed employees—or some other amount (e.g., 80 percent of premiums).
Second, the American Rescue Plan would accomplish one of candidate Biden’s key campaign promises by expanding and increasing the value of premium tax credits under the ACA. Democrats in Congress have repeatedly passed legislation that would accomplish what the American Rescue Plan fact sheet seems to call for. For instance, the Patient Protection and Affordable Care Enhancement Act—passed by the House in July 2020—would have expanded the availability of premium tax credits to those whose income is above 400 percent of the federal poverty level and made those credits more generous by reducing the level of income that an individual must contribute towards their health insurance premiums to 8.5 percent for those with the highest incomes. This subsidy expansion and enhancement would improve the affordability of coverage for millions of Americans who purchase coverage in the individual market.
Beyond COBRA and ACA subsidies, the American Rescue Plan calls for additional funding for veterans’ health care needs and for the Substance Abuse and Mental Health Services Administration and the Health Resources and Services Administration to expand access to behavioral health services. The proposal would also increase the federal Medicaid assistance percentage (FMAP) to 100 percent for the administration of COVID-19 vaccines to help ensure that all Medicaid enrollees will be vaccinated. The proposal does not appear to otherwise mention Medicaid, which is serving as a key safety net as incomes have dropped for millions of Americans, despite bipartisan support for an enhanced FMAP during the pandemic.
Consumers choosing insurance via the federal Affordable Care Act exchanges reached 8.25 million over the 2021 open enrollment period, about the same number as the year before, CMS said Wednesday.
Because two fewer states are participating in the federal marketplace this year, adjusted year-over-year growth in plan selections was 7%, the agency said.
Of the total, 23% of consumers were new, down by 3.6%. Renewing consumers who actively chose a new plan and those who were automatically re-enrolled both increased.
Dive Insight:
The figures are the last from the Trump administration, which has drastically reduced money toward navigators who help people use the Healthcare.gov website and find the best ACA plan for them. The administration has made no secret of its opposition to the law and after failing to overturn it in Congress has used executive actions to undermine it.
President-Elect Joe Biden and his pick for HHS chief, California Attorney General Xavier Becerra, however, are eager supporters and are likely to take a number of actions to restore and burnish it. That could be increasing tax credits and subsidies, increasing navigator funding and building on protections like essential health benefits.
The U.S. Supreme Court is expected to make its ruling on the ACA case later this spring or summer, but the Biden administration could essentially make it moot by walking back the zeroing out of the individual mandate penalty that is the linchpin of the lawsuit against it.
The relatively steady enrollment could be increased through those actions and the possibility of a special enrollment period to account for needs during the coronavirus pandemic. The COVID-19 crisis and the recession it has caused have kicked millions of people off their employer-sponsored insurance, and they could turn to the exchanges for coverage, especially with higher tax credits and subsidies.
With just a dozen days left in power, the Trump administration on Friday approved a radically different Medicaid financing system in Tennessee that for the first time would give the state broader authority in running the health insurance program for the poor in exchange for capping its annual federal funding.
The approval is a 10-year “experiment.” Instead of the open-ended federal funding that rises with higher enrollment and health costs, Tennessee will instead get an annual block grant. The approach has been pushed for decades by conservatives who say states too often chafe under strict federal guidelines about enrollment and coverage and can find ways to provide care more efficiently.
But under the agreement, Tennessee’s annual funding cap will increase if enrollment grows. What’s different is that unlike other states, federal Medicaid funding in Tennessee won’t automatically keep up with rising per -person Medicaid expenses.
The approval, however, faces an uncertain future because the incoming Biden administration is likely to oppose such a move. But to unravel it, officials would need to set up a review that includes a public hearing.
Meanwhile, the changes in Tennessee will take months to implement because they need final legislative approval, and state officials must negotiate quality of care targets with the administration.
TennCare, the state’s Medicaid program, said the block grant system would give it unprecedented flexibility to decide who is covered and what services it will pay for.
Under the agreement, TennCare will have a specified spending cap based on historical spending, inflation and predicted future enrollment changes. If the state can operate the program at a lower cost than the cap and maintain or improve quality, the state then shares in the savings.
Trump administration officials said the approach adds incentive for the state to save money, unlike the current system, in which increased state spending is matched with more federal dollars.If Medicaid enrollment grows, the state can secure additional federal funding. If enrollment drops, it will get less money.
“This groundbreaking waiver puts guardrails in place to ensure appropriate oversight and protections for beneficiaries, while also creating incentives for states to manage costs while holding them accountable for improving access, quality and health outcomes,” said Seema Verma, administrator of the Centers for Medicare & Medicaid Services. “It’s no exaggeration to say that this carefully crafted demonstration could be a national model moving forward.”
Opponents, including most advocates for low-income Americans, say the approach will threaten care for the 1.4 million people in TennCare, who include children, pregnant women and the disabled. Federal funding covers two-thirds of the cost of the program.
Michele Johnson, executive director of the Tennessee Justice Center, said the block grant approval is a step backward for the state’s Medicaid program.
“No other state has sought a block grant, and for good reason. It gives state officials a blank check and creates financial incentives to cut health care to vulnerable families,” she said.
The agreement is different from traditional block grants championed by conservatives since it allows Tennessee to get more federal funding to keep up with enrollment growth. In addition, while the state is given flexibility to increase benefits, it can’t cut them on its own.
Democrats have fought back block grant Medicaid proposals since the Reagan administration and most recently in 2018 as part of Republicans’ failed effort to repeal and replace major parts of the Affordable Care Act. Even some key Republicans opposed the idea because it would cut billions in funding to states, making it harder to help the poor.
Implementing block grants via an executive branch action rather than getting Congress to amend Medicaid law is also likely to be met with court challenges.
“This is an illegal move that could threaten access to health care for vulnerable people in the middle of a pandemic,” Rep. Frank Pallone (D-N.J.), chair of the House Energy and Commerce Committee, posted on his Twitter account. “I’m hopeful the Biden Administration will move quickly to rollback this harmful policy as soon as possible.”
The block grant approval comes as Medicaid enrollment is at its highest-ever level.
More than 76 million Americans are covered by the state-federal health program, a million more than when the Trump administration took charge in 2017. Enrollment has jumped by more than 5 million in the past year as the economy slumped with the pandemic.
Medicaid, part of President Lyndon B. Johnson’s “Great Society” initiative of the 1960s, is an entitlement program in which the government pays each state a certain percentage of the cost of care for anyone eligible for the health coverage. As a result, the more money states spend on Medicaid, the more they get from Washington.
Under the approved demonstration, CMS will work with Tennessee to set spending targets that will increase at a fixed amount each year.
The plan includes a “safety valve” to increase federal funding due to unexpected increases in enrollment.
“The safety valve will maintain Tennessee’s commitment to enroll all eligible Tennesseans with no reduction in today’s benefits for beneficiaries,” CMS said in a statement.
Tennessee has committed to maintaining coverage for eligible beneficiaries and existing services.
In exchange for taking on this financing approach, the state will receive a range of operating flexibilities from the federal government, as well as up to 55% of the savings generated on an annual basis when spending falls below the aggregate spending cap and the state meets certain quality targets, yet to be determined.
The state can spend that money on various health programs for residents, including areas that Medicaid funding typically doesn’t cover, such as improving transportation and education and employment services for enrollees.
The 10-year waiver is unusual, but the Trump administration has approved such long-term experiments in recent years to give states more flexibility.
Tennessee is one of 12 states that have not approved expanding Medicaid under the Affordable Care Act, leaving tens of thousands of working adults without health insurance.
“The block grant is just another example of putting politics ahead of health care during this pandemic,” said Johnson of the Tennessee Justice Center. “Now is absolutely not the time to waste our energy and resources limiting who can access health care.”
State officials applauded the approval.
“It’s a legacy accomplishment,” said Tennessee Gov. Bill Lee, a Republican. “This new flexibility means we can work toward improving maternal health coverage and clearing the waiting list for developmentally disabled.”
“This means we will be able to make additional investments in TennCare without reduction in services and provider cuts.”
The economy lost 140,000 jobs in December, the first reported losses since April, as the unemployment rate remained steady at 6.7 percent.
Economists expected a small jobs gain of nearly 50,000. The drop is the latest sign of a weakening economy amid the ongoing COVID-19 crisis. All in all, the economy remains about 10 million jobs below its pre-pandemic levels.
“There’s not much comfort to be taken from the stable unemployment rate, given that millions of Americans have left the labor force with nearly 11 million listed as officially out of work,” said Mark Hamrick, senior economic analyst at Bankrate.com.
“Between the human and economic tolls taken by the pandemic, these are some of the darkest hours of this soon-to-be yearlong tragedy.”
The biggest losses were concentrated in leisure and hospitality, a sector particularly vulnerable to the effects of the pandemic, which lost an astonishing 498,000 jobs.
State and local government payrolls shed 51,000 jobs. Congress deferred passing state and local aid in its latest COVID-19 relief bill.
But the overall loss would have been worse had it not been for gains in professional and business services, which added 161,000 jobs; retail trade, which added 120,500 jobs; and construction, which added 51,000.
Some demographic groups have been hit harder by the economic downturn.
The unemployment rate for Hispanics rose to 9.3 percent in December, while Black unemployment remained elevated at 9.9 percent. The rate for whites was 6 percent, and for Asians it was 5.9 percent.
Over a third of jobless people have been unemployed for over 27 weeks.
Their Senate majority will be slim as can be, and their margin for error in the House is also quite small. So it’s not going to be easy to get anything done. But it seems likely that the Biden White House and a Democratic Congress will try to pass legislation to expand health coverage.
Regarding what Democrats’ health care agenda would look like if the party enjoyed full control of Congress and the White House, a senior party official told reporters this fall: “If we don’t take full advantage of this moment, we’ll be making a huge mistake.”
The question is how big they will go. A lengthy health care section will likely be part of any new Covid-19 relief and recovery bill. But will that be the end of it, or do Democrats want to try to pass another health care plan through budget reconciliation? Given Senate rules, that process is probably their best chance of passing a major bill.
Taking a cue from my Future Perfect colleagues and their 21 predictions for 2021, I thought I would lay out some of my expectations for the coming two years of health policy. These projections are based on my own reporting, but they are not meant to be definitive — and nothing is 100 percent guaranteed. It’s more like a list of issues I’ll be watching.
Democrats will expand eligibility for Obamacare subsidies: 85 percent chance
Democrats could attempt to take two bites at the health care apple: first as part of a Covid-19 relief bill, and second in a budget reconciliation package that can pass with a bare majority. I think there is a very strong chance both attempts would end up with provisions expanding eligibility for insurance tax subsidies.
The $2.4 trillion HEROES Act passed by the House, a likely starting point for Covid-19 negotiations between the House and the Senate, would have made anybody currently on unemployment insurance eligible for premium tax credits. That would help people who have lost their employer-sponsored coverage afford a new health care plan. A provision like that is likely to become part of whatever Covid-19 bill Congress comes up with.
A reconciliation bill could make that change permanent and universal. Back in spring 2020, Senate Democrats released a list of their health care priorities in response in response to Covid-19. At the top was a plan to raise the current cutoff for Obamacare subsidies, which stands at 400 percent of the federal poverty level.
Under current law, anybody with an annual income above that threshold, which is about $51,000 for an individual or $87,000 for a family of three, is ineligible for any assistance. Democrats have introduced plans to expand eligibility, either by doubling the income cap to 800 percent of the federal poverty level (like in this bill from Sen. Jeanne Shaheen) or by eliminating it entirely so that nobody pays more than a fixed percentage of their income on health insurance (as President-elect Joe Biden proposed). Democrats could also try to make low-income people in states that have not expanded Medicaid eligible for tax credits to buy private coverage.
The people squeezed under Obamacare have been the ones ineligible for the law’s financial aid. Expanding eligibility could insure up to 4 million people, and it seems like the bare minimum Democrats would want to do on health care with their new power.
The public option won’t be part of a Democratic health care bill: 75 percent chance
Much like the 2009 debate over Obamacare, a new government insurance plan would probably be the most hotly debated proposal if Democrats try to approve a major health care bill. Biden embraced the public option in his campaign, but passing it won’t be easy — in fact, I think it’s more likely than not that it doesn’t happen.
One problem for a public option is budget reconciliation. Unless Democrats are willing to eliminate the 60-vote legislative filibuster, they’ll have to use this special procedural tool in order to pass a bill with just 51 votes.
But budget reconciliation comes with limits on what provisions can be included, narrowly targeted to federal spending, and creating this new program may not qualify. Capital Alpha, a health care policy analysis group, thinks there is “virtually zero chance” a public option like that proposed by Biden during his campaign would be enacted because it likely doesn’t satisfy the reconciliation rules.
Progressives will push Democratic leadership to be as aggressive in pursuing a public option as possible, including in how they handle those procedural limits. But the moderate Senate Democrats who will ultimately dictate what the final package will look like have sounded ambivalent about the public option, and Democrats are wary of the party getting dragged into a messy health care fight.
Support for a public option would be substantial — about 70 percent of Americans say they’re for it, polls show — but so would the opposition. The health care industry will surely mobilize against the plan if Democrats look serious about pursuing it.
I suspect that, either because the moderates rule it out from the start or Democratic leaders balk at a drawn-out health care debate, politics will take the policy off the table.
Democrats will approve Medicare negotiations for prescription drugs: 55 percent chance
Democrats have campaigned for several election cycles now on a promise to give Medicare more power to negotiate drug prices with pharma companies. This promise was a part of the drug pricing bill that House Democrats passed in the last Congress, a plan that was estimated to cut federal spending by $456 billion over 10 years.
Savings are the reason the policy could be handy for Democrats in crafting a budget reconciliation plan. Democrats will need to include provisions that save the government money to help pay for the new provisions that cost money, like expanding eligibility for tax subsidies.
“We have long believed that pharma faces the greatest risk of drug pricing reforms in conjunction with Democrats’ efforts to expand coverage,” Capital Alpha wrote in a recent analysis.
Those twin incentives — delivering on a campaign promise and finding offsets — could help overcome what would surely be fierce industry opposition.
But the politics of drug pricing have shifted during the Covid-19 pandemic, which is why I think there’s only a slightly better than even chance that Congress will approve Medicare negotiations. Pharma has delivered the Covid-19 vaccines in record time, improving the industry’s relationship with the public in the process. This, in turn, has lowered expectations among the experts for how aggressive Democrats will be on drug prices.
“I think now you don’t have all those stories about insulin and EpiPen, plus you have positive stories about vaccines and other drugs,” Walid Gellad, director of the Center for Pharmaceutical Policy and Prescribing at the University of Pittsburgh, told me in December. “You don’t have as fertile an environment for more extreme drug measures.”
Thus, my feeling that the odds for Medicare negotiations are closer to 50/50.
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HENRY KOTULA 