Democrats get an opportunity to engineer ‘Obamacare 2.0’
Ever since the Affordable Care Act became law in 2010 — a big deal, in the (sanitized) words of Vice President Joe Biden — Democrats have itched to fix its flaws.
But Republicans united against the law and, for the next decade, blocked nearly all efforts to buttress it or to make the kinds of technical corrections that are common in the years after a major piece of legislation.
Now the Biden administration and a Democratic Congress hope to engineer the first major repair job and expansion of the Affordable Care Act since its passage. They plan to refashion regulations and spend billions through the stimulus bill to make “Obamacare” simpler, more generous and closer to what many of its architects wanted in the first place.
“This is the biggest expansion that we’ve had since the ACA was passed,” said Rep. Frank Pallone of New Jersey, who helped draft the health law more than a decade ago and leads the House Energy and Commerce Committee. “It was envisioned that we’d do this periodically, but we didn’t think we’d have to wait so long.”
The Affordable Care Act has expanded coverage to more than 20 million Americans, cutting the uninsured rate to 10.9% in 2019 from 17.8% in 2010. It did so by expanding Medicaid to cover those with low incomes, and by subsidizing private insurance for people with higher earnings. But some families still find the coverage too expensive and its deductibles too high, particularly those who earn too much to qualify for help.
Tucked inside the stimulus bill that the House passed early Saturday are a series of provisions to make the private plans more affordable, at least in the short term.
The legislation, largely modeled after a bill passed in the House last year, would make upper-middle-income Americans newly eligible for
financial help to buy plans on the “Obamacare” marketplaces and would increase the subsidies already going to lower-income enrollees. The changes would last two years, cover 1.3 million more Americans and cost about $34 billion, according to the Congressional Budget Office.
For certain Americans, the difference in premium prices would be substantial: The Congressional Budget Office estimates that a 64-year-old earning $58,000 would see monthly payments decline from $1,075 under current law to $412 with the new subsidies.
It was a blow to “Obamacare’s” authors when the Supreme Court allowed states to refuse to expand Medicaid, the health law’s primary tool for bringing comprehensive coverage to poor Americans. Multiple states have joined the expansion in recent years, some via ballot initiative, but some Republican governors have steadfastly
rejected the program, resulting in 2 million uninsured Americans across 12 states.
The stimulus package aims to patch that hole by increasing financial incentives for states to join the program. Though Democrats are offering holdout states larger payments than they’ve contemplated in the past, it’s unclear whether it will be enough to lure state governments that have already left billions on the table. Under current law, the federal government covers 90% of new enrollees’ costs.
Republican critics of the law contend that Democrats are seeking to install long-sought permanent policies through a temporary stimulus plan.
“Suffice it to say, this is not COVID relief,” said Sen. Bill Cassidy of Louisiana, who helped write a prominent “Obamacare” repeal bill in 2017. “It’s fulfilling the agenda of the Biden administration under the guise of COVID relief.”
Cassidy fears that short-term spending increases on “Obamacare” will prove difficult to undo. He cited a quotation from former President Ronald Reagan: “Nothing lasts longer than a temporary government program.”
The White House and the Department of Health and Human Services already have begun to advertise insurance options and make them easier to get. On Feb. 15, the Biden administration opened a special enrollment period so that uninsured people could sign up for coverage right away, publicizing it widely. Officials also have begun rolling back President Donald Trump-era work requirements in the Medicaid program.
Other regulatory changes are also planned. Xavier Becerra, Biden’s choice to lead HHS, testified about his ambitions on Capitol Hill on Wednesday. Officials are hoping to resolve the “family glitch” problem, which makes “Obamacare” insurance expensive for the children or spouses of workers who get insurance only for themselves at their job. Officials plan to tighten the rules for private short-term insurance plans that are not required to cover a full set of benefits. And they are considering a long list of technical changes aimed at making plans more comprehensive.
“When you think about where we thought the ACA was headed four years ago, and contrast that to where we are right now, on the cusp of a massive expansion of affordability, it’s pretty exciting,” said Christen Linke Young, deputy director of the White House Domestic Policy Council for Health and Veterans Affairs.
But Bob Kocher, an economic adviser during President Barack Obama’s administration who is now a partner at the venture capital company Venrock, said that beyond the current changes, Biden’s mission on “Obamacare” seemed more modest, more like “don’t break it.”