Expanding coverage to the estimated 2.2 million people who do not have affordable health insurance options in the expanding Medicaid states would fulfill a promise made by the Biden campaign, while its other major promises in health care, such as state drug price negotiations and a public option facing difficult opportunities in Congress. Democrats also believe that this would mean a major victory for their party, which is set to break into highly competitive mid-term elections next year, as Medicaid’s expansion is well coordinated – even in states where Republican leaders have been blocking it for years.
However, the new efforts carry risks that Democratic lawmakers, White House officials and health care lawyers have found difficult to resolve in behind-the-scenes discussions over the past few months, say those involved in those talks. One challenge is to develop a program that will not create backlash from a healthcare industry willing to fight Democrats on other profound changes. Another problem is inadvertently rewarding states that have blocked Medicaid’s expansion for years. Any plan would also come with a heavy cost.
“It is generally accepted that action is needed to reach out to the population,” said Henry Connelly, spokesperson for House spokeswoman Nancy Pelosi.
Democratic lawmakers are weighing a few options that could potentially be wrapped up in a big economic package that they will hopefully pass on in partisan politics this year. They have not yet agreed on an approach, however, and Democratic leaders face competing calls to use upcoming infrastructure legislation to expand Medicare eligibility and benefits, mandate drug price negotiations, and bolster Obamacare subsidies .
Healthcare advocates caution that Democrats have limited time to address stalled advances in Medicaid’s expansion – viewed as the largest unfinished piece of the Affordable Care Act – while the Washington Party for the first time since the passage of the Law controlled a decade ago.
“The time is now,” said Judy Solomon, a senior official at the leftist center on budget and political priorities. “This is probably the only moment we’ll have in years.”
The White House has taken a largely straightforward approach to talks about a Medicaid expansion alternative, as it has with other major health care proposals that Biden has campaigned. While Biden’s budget proposal on Friday reiterated his support for these ideas, including closing the Medicaid coverage gap, he lacked the details. The only major health pledge that Biden has included in major economic laws is what is seen as the least politically divisive: the temporary expansion of financial aid to people who buy Obamacare health plans through the recent Covid aid package on a permanent basis close.
“The president has consistently supported the provision of coverage for this population,” said a government official when asked about the government’s plans in the expanding states of Medicaid.
Congressional bodies responsible for Medicaid, the House Energy and Commerce Committee, and the Senate Finance Committee have directed work on the issue. The committee chairs and Pelosi have not spoken publicly about their plans as staff work through the details.
Federal bypass support got a big boost this week when Georgia Sens. Raphael Warnock and Jon Ossoff, whose elections put Democrats in control of Washington, called on the leadership to incorporate politics into infrastructure legislation. Senate approval this week by Chiquita Brooks-LaSure to lead the federal agency for Medicare and Medicaid is also expected to accelerate the work of the Biden administration on health insurance policy.
The renewed urge to insure people in the expansion areas comes after those states largely ignored new financial incentives to expand Medicaid that were included in the Democrats’ stimuli. The law provides for a two-year increase in federal Medicaid payments to states that are expanding, in addition to the generous federal game they would already receive for covering the expanding population.
Of the holdout states, only the Wyoming legislature seriously considered an expansion bill that year, but it died in the Senate after it passed the House. And recent moves in other states have shown that expansion across the country still faces difficult hurdles.
In Wisconsin, Republican lawmakers quickly closed a special session this week that Democratic Governor Tony Evers had called to consider enlargement. In Missouri, the state faces a lawsuit after Governor Mike Parson refused to implement an extension that voters approved last summer. And in Mississippi, proponents halted a campaign to put Medicaid’s expansion on the vote next year after a Supreme Court ruling made such initiatives impossible.
“What just happened in Wisconsin and Missouri is giving some momentum to the effort because it is clear that if Republicans can stop this in holdouts, they will,” said Brad Woodhouse, president of the liberal group Protect Our Care who is closely associated with democratic leaders in Congress.
However, the drafting of the directive remains difficult. And while Republicans in Congress have given up trying to overturn Obamacare, they are not expected to support the effort.
Biden’s budget is to create a state health insurance option in the holdout states that will provide free coverage along the lines of Medicaid. States that were already expanding and funding 10 percent of the program cost would receive unspecified “financial incentives” to discourage them from removing coverage.
This idea would likely generate quick opposition from hospitals and health insurers who support the expansion of Medicaid but oppose a public option that would weigh on their profits.
Chip Kahn, president of the Federation of American Hospitals, said it would be difficult to set up a new coverage system without creating a financial imbalance between states that have expanded Medicaid and those that haven’t.
“The fact that not all states have implemented the ACA Medicaid expansion means that eligible Americans are unequal,” said Kahn, whose group represents nonprofit hospitals. “The problem, however, is that trying to find a solution for the states that have stayed away from ACA Medicaid creates inequalities in funding and rules between states that are expanding and those that don’t would.”
Another idea is to expand Obamacare subsidies to provide low-income people in non-expanding countries with free private insurance coverage on the law’s insurance marketplaces. Currently, people who earn below the federal poverty line, or around $ 13,000 a year, are not eligible for Obamacare grants. Expanding these subsidies would be expensive because private plans cost the government much more per person than Medicaid or Medicare.
A third idea from Doggett, chairman of the Ways and Means Health subcommittee, would seek to bypass state opposition by giving counties and other local governments the ability to expand Medicaid in a hyperlocal way. This would still leave large gaps in reporting and could be difficult to implement.
As of Thursday, nearly 60 civil rights and advocacy groups – including the NAACP, The Arc, Planned Parenthood, and the Whitman-Walker Institute – in a letter urged the legislature to expand coverage in the holdout states “as part of this year’s restructuring legislation”.
“Congress has a responsibility – which it has exercised in some of its proudest moments in the past – to intervene in national politics to ensure that everyone is treated equally regardless of the state or territory in which they live,” write.