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So, where does health care reform fit in all of this?

January 7, 2021

Topics: Quote of the Day

Senate control opens up new possibilities, but the party will still need to contend with arcane rules and the challenges of a narrow majority.

By Sarah Kliff and Margot Sanger-Katz
The New York Times, January 7, 2021

The Democrats’ new congressional majority puts a variety of health policy ideas suddenly into reach, even if big structural changes remain unlikely.

A series of tweaks bolstering the Affordable Care Act stands the best chance of passage. Legislators could make insurance subsidies more generous, get coverage to low-income Americans in states that haven’t expanded Medicaid, and render moot a pending Supreme Court lawsuit that aims to overturn the entire law.

But structural overhauls like “Medicare for all,” which would move all Americans to a government-run health plan, face a much tougher road. So would elements of Joe Biden’s health agenda, such as a public option, which would give Americans a choice between a new public plan and private insurance.

There are six areas of health policy where congressional aides and health policy experts could see Democrats focusing their efforts this year. Smaller policy reforms are expected to be easier, both legally and politically, while more ambitious policies may not easily slot into reconciliation’s strict rules — or the political preferences of enough Democratic lawmakers.

Affordable Care Act expansions

One priority is raising the income ceiling for those who receive subsidies, expanding the number of people who qualify for help. Another is rewriting formulas to peg the size of the subsidy to a more generous health insurance plan, a way to increase the amount of assistance.

Texas v. California came about because of legislation that a Republican-controlled Congress passed in 2017, lowering the penalty for not carrying health insurance to zero dollars. Democrats could use reconciliation to reverse those changes.

Closing the Medicaid gap

In his campaign plan, President-elect Biden proposed fixing this problem by allowing these patients to enroll in a new public health plan. That type of policy may be too complex to move through reconciliation, but simpler policy options could also do the trick.

Reducing drug prices

Experts thought that certain drug pricing controls might be possible with reconciliation, since they have clear budgetary effects. But the politics of passage could be difficult with narrow majorities in both the House and Senate and such strong opposition from the drug industry.

A public option

President-elect Biden included a public health insurance option, available to all Americans, in his 2020 campaign platform. The slim majority in the Senate, however, may make it hard to move this type of plan forward.

Medicare for all

The larger obstacle to such a plan is more likely political than procedural. Currently, a majority of House Democrats back Medicare for all, but that would not be nearly enough votes to pass such a bill. An even smaller share of senators back the plan.



By Don McCanne, M.D.

Sarah Kliff and Margot Sanger-Katz are very astute observers of the national health policy and politics agenda. You can rely on their reporting to provide an accurate prediction of the policy agenda under the Biden administration.

It is most likely that health reform activities will be limited to making adjustments to the Affordable Care Act which will allow more individuals to participate and will provide limited additional financial relief for those already in the program, but, basically, there will be little fundamental change to our expensive, administratively wasteful, and inadequate health care financing infrastructure. Particularly disconcerting is that the private insurance sector will have an even greater role in health care financing through an expansion of the ACA exchanges, and an expansion of the Medicaid managed care programs. When the private insurers are a major source of our health care financing dysfunctions, it seems disingenuous to expand their role.

President-elect Biden has stated that he will not approve a single payer Medicare for All program. That does not mean that we should walk away and wait another four years. It does mean that the political threshold has not been met to expect enactment in the near future, and that means that our task is to expand our efforts to educate the public as to the features of the single payer model that make it a moral imperative. So, instead of having less to do because of Biden’s rejection of the model, it means that we need to greatly intensify our advocacy efforts, and that means we have a lot of work to do. It is an imperative that a national, single payer, improved Medicare for All remain the ultimate, compelling goal.

A word needs to be said about the public option. Right now there is fairly intense political activity to try to convince Biden and Congress to enact a Medicare-like public option as an incremental step towards the eventuality of single payer Medicare for All. It is proposed that the public option could be created and then later expanded into a universal Medicare for All.

First of all, a model that would be suitable for a single payer system cannot be created as a stand-alone option in our fragmented system of health care financing. Single payer needs to be financed with progressive taxes, but you cannot expect individuals to pay for their own private plans, whether or not employer-sponsored, and also pay progressive taxes to buy coverage for others who choose the public option. Also, much of the financial feasibility of the single payer system derives from eliminating hundreds of billions of dollars in administrative excesses, but with a public option in a market of private plans, most of the administrative waste would be perpetuated, Also, the administrative savings of our traditional Medicare program would not be duplicated in a public option that must be designed much like our current private plans to be able to compete in the marketplace – a dysfunctional model that we are trying to eliminate. The lack of administrative efficiency in both the structure of the public option and in the administrative complexity that it places on the health care delivery system would allow opponents of single payer to say that the public option proves that single payer cannot save money.

If such a public option were designed as a transitional program to be replaced by single payer in about four years – an approach supported by many of the public option advocates – the definitive single payer model must be mandated in the initial legislation or else it would be abandoned when it became obvious that it didn’t work, as indicated above. It cannot work because it is not a single payer system and forgoes almost all of the single payer efficiencies.

Some say we should have a four year transitional public option anyway. Why? Avoid disruption? Disrupting one-fourth of the system each year would be more complex and more expensive than disrupting the entire system in a single step. Disrupting health care coverage for people over 65 by placing them on Medicare was done as a single step on July 1, 1966. It was a beneficial disruption, and it worked just fine.

Beneficial disruption is sort of like John Lewis’ good trouble. After yesterday’s disaster we sure could use a large dose of good trouble right now.


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About the Commentator, Don McCanne

Don McCanne is a retired family practitioner who dedicated the 2nd phase of his career to speaking and writing extensively on single payer and related issues. He served as Physicians for a National Health Program president in 2002 and 2003, then as Senior Health Policy Fellow. For two decades, Don wrote "Quote of the Day", a daily health policy update which inspired HJM.

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