What role should the federal government play in addressing major healthcare issues? And does the way you vote affect your prospects for a long and healthy life? We talked about it on today’s episode of the 4sight Friday Roundup podcast.
David Johnson is CEO of 4sight Health.
Julie Vaughan Murchinson is Partner of Transformation Capital and former CEO of Health Evolution.
David Burda is News Editor and Columnist of 4sight Health.
The Biden administration recently signaled that it will extend the federal COVID-19 public health emergency (PHE), which has been in place for nearly two-and-a-half years, beyond its current July 15 expiration date. As shown in the graphic above, a number of key pandemic-era policies would end if the PHE were discontinued. Hospitals, already experiencing financial challenges, would face an immediate 20 percent reduction in Medicare reimbursement for each hospitalized COVID patient.
Combined with the end of funding for treating uninsured COVID patients, and with millions of Americans expected to lose Medicaid coverage when eligibility checks restart, the cost of treating COVID patients will fall more heavily on providers. More treatment costs will also be passed on to patients, as most private insurers no longer waive cost-sharing for COVID care.
On the telemedicine front, Congress has temporarily extended some Medicare telehealth flexibilities (including current payment codes and coverage for non-rural beneficiaries) for five months after the PHE ends, while CMS studies permanent coverage options. But further Congressional action will be required to keep current Medicare telehealth coverage in place, and these decisions will surely influence private insurers’ telehealth reimbursement policies.
Although the Biden administration promises that it will provide sixty days’ notice before terminating the PHE or letting it expire, providers must prepare for the inevitable financial hit when the PHE ends.
The formal end of the pandemic could swell the ranks of uninsured children by 6 million or more as temporary reforms to Medicaid are lifted.
Why it matters: Gaps in coverage could limit access to needed care and widen health disparities, by hitting lower-income families and children of color the hardest, experts say.
The big picture: A requirement that states keep Medicaid beneficiaries enrolled during the public health emergency in order to get more federal funding is credited with preventing a spike in uninsured adults and kids during the crisis.
Children are the biggest eligibility group in Medicaid, especially in the 12 states that haven’t expanded their Medicaid programs under the Affordable Care Act.
The lifting of the public health emergency, which was just extended to July 15, will lead states to determine whether their Medicaid enrollees are still eligible for coverage — a complicated process that could result in millions of Americans being removed from the program.
That would more than double the number of uninsured kids, which stood at 4.4 million in 2019.
“It is a stark, though we believe conservative, estimate,” said Joan Alker, the center’s executive director. “There are a lot of children on Medicaid.”
Between the lines: Not all of the Medicaid enrollees who are removed from the program would become uninsured. But parents and their children could be headed down different paths if their household income has risen even slightly.
Adults who’ve returned to work may be able to get insurance through their employer. Others could get coverage through the ACA marketplace, though it’s unclear whether that would come the COVID-inspired extra financial assistance that’s now being offered.
Most kids would be headed for the Children’s Health Insurance Program, Alker said — a prospect that can entail added red tape and the payment of premiums or an annual enrollment fee, depending on the state.
What we’re watching: Changes in children’s coverage could be most pronounced in Texas, Florida and Georgia — the biggest non-Medicaid expansion states, which have higher rates of uninsured children than the national average.
Congress could still require continuous Medicaid coverage, the way the House did when it passed the sweeping social policy package that stalled in the Senate over cost concerns.
CMS’ Office of the Actuary projects a smaller decline in Medicaid enrollment than some health policy experts are predicting — and the Biden administration continues to move people deemed ineligible for Medicaid onto ACA plans, Raymond James analyst Chris Meekins noted in a recent report on the unwinding of the public health emergency.
President Joe Biden proposed a change in federal regulations April 5 to expand health coverage to millions of people through the Affordable Care Act.
The proposal aims to close what is known as the “family glitch,” according to a press release.
People who do not have access to affordable health coverage through their employers can qualify for subsidies to purchase coverage through the ACA marketplace. The federal definition of affordable employer-provided coverage is only for single individuals and not for family members, meaning about 5 million people are ineligible for the marketplace subsidy.
To fix the glitch, the proposal directs the Treasury Department and Internal Revenue Service to allow family members of employees who are offered affordable self-only coverage but unaffordable family coverage to qualify for the subsidies to purchase family health coverage through the ACA marketplace. If the rule is approved, an estimated 200,000 uninsured people would gain coverage, and nearly 1 million would see their coverage become more affordable.
President Biden will also sign an executive order Tuesday directing agencies to find ways to make coverage more affordable for more people.
President Joe Biden proposed a $5.8 trillion budget March 28 for fiscal year 2023, which includes funding for healthcare.
Nine healthcare takeaways:
1. Pandemic preparedness. The budget calls for a five-year investment of $81.7 billion to plan ahead for future pandemics. The funding would help support research and development of vaccines, improve clinical trial infrastructure and expand domestic manufacturing.
2. Mental health parity. Under the proposed budget, federal regulators would get the power to levy fines against health plans that violate mental health parity rules. The budget calls for $275 million over 10 years to increase the Labor Department’s capacity to ensure health plans are complying with the requirements and take action against those plans that do not. The budget also proposes funding to bolster the mental healthcare workforce and boost funding for suicide prevention programs.
3. Vaccines for uninsured adults. The proposed budget calls for establishing a new Vaccines for Adults program that would provide uninsured adults access to recommended vaccines at no cost.
4. Title X funding. The budget proposes providing $400 million in funding for the Title X Family Planning Program, which provides family planning and other healthcare services to low-income individuals.
5. Cancer Moonshot initiative. The budget proposes several investments across the FDA, CDC, National Cancer Institute and Advanced Research Projects Agency for Health to advance President Biden’s Cancer Moonshot initiative. The initiative aims to reduce the cancer death rate by 50 percent over the next 25 years.
6. Spending to reduce HIV. The proposed budget includes $850 million to reduce new HIV cases by increasing access to HIV prevention services and support services.
7. Veterans Affairs medical care. President Biden’s proposed budget allocates $119 billion, or a 32 percent increase, to medical care for veterans. The money will fully fund inpatient, outpatient, mental health and long-term care services, while also investing in training programs for clinicians to work in the VA.
8. Discretionary funding for HHS. President Biden is asking Congress to approve $127.3 billion in discretionary funding for HHS in fiscal 2023, representing a $26.9 billion increase from the department’s allotment for fiscal 2021.
9. Mandatory spending for the Indian Health Service. The budget request for the Indian Health Service calls for shifting the healthcare agency from discretionary to mandatory funding. The budget calls for $9.1 billion in funding, a 20 percent increase from the amount allocated in fiscal 2021.
Starting next month, the federal government will stop reimbursing hospitals and other providers for the vaccination, testing, and treatment of uninsured COVID-19 patients. So far, about 50K providers have submitted a total of $20B of claims for COVID-related care for the uninsured.
Congress has yet to authorize more funding for this and other COVID relief programs, after stripping $15.6B from the latest government spending package. Though the White House is asking Congress to authorize $22.5B for further COVID aid and surge preparedness, it’s not clear how much of any new funding would go toward reimbursing care for the uninsured.
The Gist: This news comes as US officials expect a rise in cases driven by the Omicron BA.2 subvariant. Hospitals, already struggling with high labor and supply expenses, will face further margin pressures if a future COVID surge brings increased hospitalizations.
This will be especially true for safety net hospitals, and for those in states which haven’t expanded Medicaid. At the same time, 15M Americans are also at risk of losing Medicaid coverage when the federal government ends the public health emergency. Lower-income patients and the hospitals that treat them have already shouldered COVID’s worst effects, and the funding stalemate risks further worsening their situation.
Obamacare enrollment at a record-high 14.5 million
Congress may not fund premium subsidies in 2023
The Affordable Care Act marks its 12th anniversary Wednesday, and despite a record 14.5 million enrollees, the Biden administration is preparing for the possibility that millions could lose coverage next year.
The $1.9 trillion pandemic stimulus package (Public Law 117-2), signed March 2021, reduced Obamacare premiums to no more than 8.5% of income for eligible households and expanded premium subsidies to households earning more than 400% of the federal poverty level. The rescue plan also provided additional subsidies to help with out-of-pocket costs for low-income people. As a result, 2.8 million more consumers are receiving tax credits in 2022 compared to 2021.
But without congressional action, the subsidies—and the marketplace enrollment spikes they ushered in—could be lost in 2023. A new HHS report released Wednesday, shows an estimated 3.4 million Americans would lose marketplace coverage and become uninsured if the premium tax credits aren’t extended beyond 2022.
In a briefing with reporters Tuesday, Chiquita Brooks-LaSure, administrator for the Centers for Medicare & Medicaid Services, said her agency is “confident that Congress will really understand how important the subsidies were” to enrolling more people this year. The CMS would “pivot quickly,” however, to implement new policies and outreach plans if the subsidies aren’t extended as open enrollment for 2023 begins in November.
“That said, today and tomorrow we are celebrating the Affordable Care Act,” Brooks-LaSure added. “As part of that process, we’ve been reminding ourselves that sometimes it takes some time to pass legislation. And just like the Affordable Care Act took time, we’re confident that Congress is going to address these critical needs for the American people.”
After years of legal and political brawls that turned the landmark legislation into a political football, Obamacare “is at its strongest point ever,” Brooks-LaSure said. The 14.5 million total enrollees—those who extended coverage and those who signed up for the first time—is a 21% increase from last year. The number of new consumers during the 2022 open enrollment period increased by 20% to 3.1 million from 2.5 million in 2021.
This week, the Department of Health and Human Services will highlight the impact of the ACA and the Biden administration’s efforts to strengthen the law. The CMS recently announced a new special enrollment period opportunity for people with household incomes under 150% of the federal poverty level who are eligible for premium tax credits. The new special enrollment period will make it easier for low-income people to enroll in coverage throughout the year.
Troubled times could be around the corner, however, as millions of people with Medicaid coverage could become uninsured after the public health emergency ends. Under the Families First Coronavirus Response Act (Public Law 116-127), signed March 2020, states must maintain existing Medicaid enrollment until the end of the month that the public health emergency is lifted. Once the continuous enrollment mandate ends, states will resume Medicaid redeterminations and disenrollments for people who no longer meet the program’s requirements.
Dan Tsai, deputy administrator and director of the Center for Medicaid and CHIP Services at CMS, said the agency is working with states to make sure people who lose Medicaid coverage can be transferred into low- and no-cost Obamacare coverage.
“A substantial portion of individuals who will no longer be eligible for Medicaid will be eligible for other forms of coverage,” including marketplace coverage, Tsai told reporters Tuesday.
In a statement, President Joe Biden acknowledged the law’s great impact. “This law is the reason we have protections for pre-existing conditions in America. It is why women can no longer be charged more simply because they are women. It reduced prescription drug costs for nearly 12 million seniors. It allows millions of Americans to get free preventive screenings, so they can catch cancer or heart disease early—saving countless lives. And it is the reason why parents can keep children on their insurance plans until they turn 26.”
And there are currently no existential legal threats to the law working their way through federal courts.
In some ways, this rosy report feels unremarkable. Why expect otherwise with the law now in place for more than a decade and baked into every part of the health care system?
But this outcome was far from inevitable.
Just five years ago, Congress tried to repeal as much of the law as possible. When those broader efforts failed, Congress eliminated the much-maligned individual mandate penalty. We appeared to have reached a stalemate: Democrats could not improve the law while Republicans could not repeal it.
Could this be the moment we moved on from ACA politics?!
Enter the courts. In early 2018, Republican attorneys general sued to invalidate the mandate and, with it, the rest of the law. That lawsuit—California v. Texas—was ultimately heard by a new Supreme Court one week after the 2020 election, and the ACA was upheld just last summer.
This marked the third time that the Supreme Court largely rebuffed what could have been a crippling legal challenge to the law. It feels like ancient history now, but it is worth remembering that we were still playing “will they or won’t they?” with the Supreme Court and ACA only one year ago.
In the meantime, the Trump administration tried to undermine access to coverage under the law—except when it didn’t. I won’t list all the relevant Trump-era policies, but they had an impact: the uninsured rate rose, and marketplace enrollment declined until the 2021 plan year.
Ironically, one policy meant to destabilize the market had the opposite effect: so-called “silver loading” led to more generous marketplace subsidies and likely helped stave off even greater coverage losses.
This is the recent history that is top of mind as I reflect on the year ahead—and the work left to do to achieve universal coverage. Here are just some of the major issues facing policymakers:
• The clock is ticking toextend the American Rescue Plan Act subsidies. If Congress fails to do so, millions will face premium hikes next year and marketplace enrollment will likely drop.
• More than 2 million low-income peopleremain stuck in the Medicaid coverage gap in the 12 states that have not yet expanded their Medicaid program.
• Up to 15 million people, including nearly 6 million children, could lose Medicaid coverage at the end of the COVID-19 public health emergency.
• There is increasingly an affordability and underinsurance crisis, including for those with job-based coverage: an estimated 87 million peoplewere underinsured in 2018.
Congress and the White House are working to address these challenges, but much uncertainty remains.
“It feels like ancient history now, but it is worth remembering that we were still playing ‘will they or won’t they?’ with the Supreme Court and Affordable Care Act only one year ago.” – Katie Keith
Looking beyond Congress, 2022 will be an important year for regulatory changes. The Biden administration has proposed, but has not yet finalized, major marketplace changes. Other already-identified priorities include fixing the family glitch, limiting short-term limited duration insurance, and enhancing nondiscrimination protections. We could see movement on at least some of these rules soon.
While the Biden administration may be waiting out Congress before initiating some rulemaking, time is of the essence. New rules take many months to adopt and then take effect—followed by more time to deal with the legal challenges that typically follow.
Follow along as I dive deep on these issues and more in a new Health Affairs’ Health Reform newsletter.
We’ll highlight the latest health policy developments—from legislation to litigation—and explain what these changes mean for patients, payers, providers, and other key health care stakeholders.
Part of the reason why medical debt is so high is because many Americans don’t have enough savings to pay their deductibles and other out-of-pocket costs, according to a second KFF analysis.
Driving the news: Health insurance plans’ out-of-pocket limits prevent enrollees from paying limitless sums of money for medical care. But that doesn’t mean they protect people from having to pay several thousands of dollars — which not everyone has lying around.
Deductibles alone, which people must pay before coverage for most services kicks in, are frequently thousands of dollars and can exceed the amount of liquid assets a household has.
By the numbers: Over 40% of multi-person households can’t cover a mid-range employer family plan deductible of $4,000, and 61% don’t have enough to cover a high-range deductible.
The ability to pay out-of-pocket costs varies significantly by income.