“Be at war with your vices, at peace with your neighbors, and let every new year find you a better man.”
-Benjamin Franklin
Pros and Cons of Different Public Health Insurance Options
Options for Expanding Health Care Coverage
It is more than likely that Democratic candidates for the 2020 presidential election will propose some type of public health insurance plan. In one of two Commonwealth Fund–supported articles in Health Affairs discussing potential Democratic and Republican health care plans for the 2020 election, national health policy experts Sherry Glied and Jeanne Lambrew assess the potential impact and trade-offs of three approaches:
- Incorporating public-plan elements into private plans through mechanisms such as limits on profits, additional rules on how insurers operate, or the use of Medicare payment rates.
- Offering a public plan — some version of Medicare or Medicaid, for example — alongside private plans. Such a plan could be offered to specific age groups, like adults 50 to 64 who are not yet eligible for Medicare, to enrollees in the Affordable Care Act’s (ACA) marketplaces, or to everyone under 65, including those working for self-insured employers. It also could be made available in regions of the country where there is little health care competition.
- Replacing the current health care financing system with a “Medicare for all” single-payer system administered by the federal government. Some single-payer proposals would allow consumers to purchase supplementary private insurance to help pay for uncovered services.
Issues for Consideration in 2020
The authors find trade-offs in each type of public plan. First, a single-payer system would significantly increase the federal budget and require new taxes, a politically challenging prospect. On the other hand, federal spending might decrease if a public plan were added to the marketplace or if public elements were added to private plans. In 2013, the Congressional Budget Office estimated that a public plan, following the same rules as private plans, would reduce federal spending by $158 billion over 10 years, while offering premiums 7 percent to 8 percent lower than private plans. A single-payer approach would lower administrative costs and profits, and likely reduce health care prices as well. By assuming control over the financing of health care, the federal government could reduce administrative complexity and fragmentation. On the flip side, the more than 175 million Americans who are privately insured would need to change insurance plans.
A public–private choice model would help ensure that an affordable health plan option is available to Americans. While politically appealing, this option presents implementation challenges: covered benefits, payment rates, and risk-adjustments all need to be carefully managed to ensure a fair but competitive marketplace. A targeted choice option might be adopted by candidates interested in strengthening the ACA marketplaces in specific regions or for specific groups (as with the Medicare at 55 Act). It would benefit Americans whose current access to affordable coverage is limited, but the same technical challenges associated with a more comprehensive choice model would apply.
Finally, to lower prices for privately insured individuals, public plan tools such as deployment of Medicare-based rates could be applied to private insurance, either across the board or specifically for high-cost claims, prescription drugs, or other services. The major challenge here is setting prices that would appropriately compensate providers.
The Big Picture
Under the ACA, the percentage of Americans who had health insurance had reached an all-time high (91 percent) in 2016, an all-time high, and preexisting health conditions ceased to be an obstacle to affordable insurance. But Americans remain concerned about high out-of-pocket spending and access to providers, and fears over losing preexisting-condition protections have grown. While most Democratic presidential candidates will likely defend the ACA and seek to strengthen it, most recognize that fortifying the law will not be enough to cover the remaining uninsured, rein in rising spending, and make health care more affordable.
While the health reform proposals of Democratic candidates in 2020 will likely differ dramatically from those of Republican candidates, recent grassroots support for the ACA’s preexisting condition clause may indicate a willingness by both political parties to support additional government intervention in private insurance markets.
The biggest health care issues of the 2020 election
https://www.brookings.edu/podcast-episode/biggest-health-care-issues-of-2020-election/
Polls show that health care is one of the top issues American voters care about, but ideas about controlling costs and expanding coverage are divided along partisan lines.
This episode features a deep dive into health care policy and what Democratic presidential candidates and Republican Party leaders are offering as their solutions. Guests are two of Brookings’s top health policy experts: Christen Linke Young is a fellow in the USC-Brookings Schaeffer Initiative for Health policy and, among her many roles in public service, served in the White House as a senior policy advisor for health.
Matthew Fiedler is also a fellow with the Schaeffer Initiative and was previously chief economist of the Council of Economic Advisers in the White House, where he oversaw the council’s work on health care policy. Both Young and Fiedler have contributed a few explainer pieces on health policy as part of the Policy 2020 project here at Brookings.
Also, meet Annelies Goger, a new David M. Rubenstein Fellow in the Metropolitan Policy program at Brookings.
Click to access BrookingsCafeteria_FiedlerLinkeYoung-TRANSCRIPT.pdf
Five health care fights to watch in 2020
Advocates hope lawmakers can beat the odds and move major health care legislation in the new year.
2019 opened with bipartisan talk of cracking down on drug prices and surprise medical bills. But it ended without major legislation signed into law on either front, and a host of other health care battles, including a lawsuit threatening the entire Affordable Care Act, looming over the coming election year.
Here are five health care fights to watch in 2020.
Drug pricing
Lowering drug prices was supposed to be an area for potential bipartisan action in 2019, but the effort ran into a brick wall of industry lobbying and partisan divisions.
There is a push to finally get legislation over the finish line in 2020, though.
Speaker Nancy Pelosi (D-Calif.) is calling for attaching drug pricing legislation to a package of expiring health care programs, like community health center funding, that must be renewed by May 22. She hopes the pressure from that deadline helps carry a larger package, but that is far from certain, especially as the election gets closer.
Democrats point to President Trump’s vow to support allowing the government to negotiate drug prices during his 2016 campaign. While Trump backed off that pledge this year, they hold out hope he might come back around. Senate Majority Leader Mitch McConnell (R-Ky.) is also strongly opposed to the idea, and has concerns about a more modest bill from Sens. Chuck Grassley (R-Iowa) and Ron Wyden (D-Ore.) that could provide a more realistic bipartisan path.
“The president said when he ran and until relatively recently that he would support negotiated prices and I expect at some point he will go back to that, and we’re just going to keep pushing the Senate to try to achieve that,” said House Energy and Commerce Committee Chairman Frank Pallone Jr. (D-N.J.).
Surprise billing
The other major health care initiative that Pelosi says she wants in the May package is protecting patients from surprise medical bills.
That effort has also fallen prey to intense industry lobbying and congressional infighting.
Backers of a bipartisan bill from the House Energy and Commerce Committee and Senate Health Committee on the issue pushed for including the measure in a year-end spending and were deeply frustrated when it was left out.
A key factor was House Ways and Means Committee Chairman Richard Neal (D-Mass.) putting forward the outline of a rival plan days before this month’s funding deadline, showing a split on the way forward.
“It’s certainly going to be harder [next year],” said Shawn Gremminger, senior director of federal relations at Families USA, a liberal health care advocacy group.
“You are now under six months out from the general election,” he said about moving legislation in May 2020.
Backers have a tough road ahead. They will have to bridge the divide between the competing plans and overcome lobbying from powerful doctor and hospital groups, who worry the legislation could lead to damaging cuts to their payments.
ObamaCare
Outside of Capitol Hill negotiating rooms, the GOP lawsuit to overturn the Affordable Care Act is looming large.
A federal appeals court last week issued a long-awaited ruling on the fate of the law, though it did little to settle the issue. The 5th U.S. Circuit Court of Appeals ruled that the law’s mandate to have health insurance is unconstitutional, but punted on the question of whether any of the rest of the law should also be struck down, instead sending it back to the lower court.
The most tangible effect of the move could be to push a final Supreme Court decision on the fate of the law past the 2020 elections, though it’s possible the justices could still choose to take the case sooner.
Democrats intend to hammer Republicans over the lawsuit during next year’s campaign, though, a strategy that paid off for the party during the 2018 midterms when they focused on health care.
The Democratic group Protect Our Care launched a national TV ad on Friday, saying “President Trump and Republicans just won a major decision in their lawsuit to repeal health care from millions of American families,” and warning of the loss of pre-existing condition protections.
Medicare for All
In the Democratic presidential race, “Medicare for All” is a central dividing line.
How the issue plays out in 2020 will depend in large part on who wins the Democratic nomination. If progressives like Sens. Bernie Sanders (I-Vt.) or Elizabeth Warren (D-Mass.) win the nomination, Republicans will be able to go full bore on their attacks that private health insurance would be eliminated under the proposal.
Even more moderate candidates like former Vice President Joe Biden and South Bend, Ind., Mayor Pete Buttigieg PETER (PETE) PAUL BUTTIGIEGPoll: Biden remains ahead of Sanders by 10 points2020 predictions: Trump will lose — if not in the Senate, then with the votersButtigieg’s former chief of staff to be sworn in as mayoral successorMORE would face attacks that their public option plans are a step down the road toward eventually implementing full-scale single payer.
The internal debate on the issue has faded somewhat from its peak. Health care has not featured as prominently in the last two debates, and some of the fighting has shifted to other areas, like candidates’ fundraising practices.
But the issue is still simmering and could burst back to open warfare among Democrats at any point.
Vaping
The battle over e-cigarette flavors will likely resume in 2020 as the Trump administration and Congress try to cut rising youth vaping rates.
Public health advocates are pushing the administration to clear the market of flavors like mint and fruit that they argue are fueling a youth vaping epidemic.
Trump said he would eliminate those flavors in September, but has appeared to back down after backlash from vaping advocates and the e-cigarette industry.
Now he says he would like to find a compromise that preserves such flavors for adults while keeping them away from kids.
Advocates like the Campaign for Tobacco-Free Kids plan to pressure Trump to follow through on his word, though it’s looking unlikely.
However, the e-cigarette market could also look vastly different after May 2020, when companies must apply to the Food and Drug Administration to stay on the market
The industry must prove its products benefit public health, a big ask for companies like Juul, whose products are favored by kids who vape.
House Democrats also plan to vote on a bill that would ban flavored e-cigarette and tobacco products, but it’s not clear if it will get a vote in the Senate.
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TOP 6 HEALTHCARE MERGERS OF 2019
M&A activity continued to thrive among insurers and providers in 2019.
As was the case in 2018, the healthcare industry saw several megamergers occur in 2019.
Healthcare leaders pointed to industry consolidation as the year’s top priority, according to a Definitive Healthcare survey, with different reasons for pursuing mergers.
Related: Top 5 Healthcare Mergers of 2018
Providers sought to achieve scale in order to address staffing shortages while insurers looked to respond to the increasing influence of consumerism in healthcare.
While some mergers fell through, many organizations announced or finalized deals during the course of the year.
Below are six major healthcare mergers that were announced or completed in 2019.
1. CVS-AETNA
The nearly $70 billion megamerger received final judicial approval in September after an extended review by U.S. District Judge Richard J. Leon.
The merger originally received approval from the Department of Justice in October 2018 but was subject to questions and criticisms by numerous stakeholders.
The deal was marked by scrutiny over vertical mergers, with Leon noting that his approval shouldn’t be seen as a rubber stamp.
2. CENTENE-WELLCARE
Centene Corp. announced a $17.3 billion merger with WellCare Health Plans in March, a move seen as doubling down on the marketplaces established by the Affordable Care Act.
The merged company will be based in St. Louis and encompass 22 million members, $97 billion in revenues, and $5 billion in EBITDA for 2019.
The pending transaction has already received regulatory approval from 25 states.
Earlier this month, Centene agreed to sell its subsidiary IlliniCare Health to CVS Health, including its Medicaid and Medicare Advantage plans in Illinois.
3. DIGNITY-CHI
Dignity Health and Catholic Health Initiatives finalized a $29 billion megamerger between the two Catholic health systems in February.
Renamed as “CommonSpirit,” the Chicago–based health system has a footprint in 21 states, with more than 700 care sites and 142 hospitals.
In November, the system released its Q1 2020 financials highlighted by $7.1 billion in revenues and a net loss of $227 million.
4. HARVARD PILGRIM-TUFTS
Harvard Pilgrim Health Care and Tufts Health Plan announced an intention to merge in August, potentially serving nearly 2.4 million plan members across New England.
As part of the proposed deal, Tufts CEO Tom Croswell would serve as CEO of the merged company while Harvard Pilgrim CEO Michael Carson would serve as president.
The two Massachusetts-based insurers told The Boston Globe earlier this month that the merger would benefit consumers with more affordable health coverage.
5. TOTAL HEALTH CARE-PRIORITY HEALTH
Total Health Care and Priority Health received final regulatory approval from the Michigan Department of Insurance and Financial Services (DIFS) in late November.
The two Michigan-based healthcare organizations, which announced plans to merge in late August, plan to complete the deal by the end of 2019.
Prior to receiving approval from state regulators, Total Health Care members approved the merger earlier this fall.
As part of the merger, the two Michigan-based healthcare organizations will also be establishing a $25 million foundation to improve health outcomes in Detroit.
6. DARTMOUTH-HITCHCOCK-GRANITEONE HEALTH
Two New Hampshire-based health systems agreed to merge nine months after signing a letter of intent to merge.
The new merged system will be renamed “Dartmouth-Hitchcock Health GraniteOne” and includes Catholic Medical Center in Manchester.
Both organizations will maintain their locations and local leadership as part of the deal.
