Public Option

ACA 1.5

Welp. Back in March, I wrote a 3-part series about what types of healthcare policy improvements/upgrades might be in the offering now that Democrats have taken control of the White House, (just barely) retained control of the House of Representatives and (just barely) taken control of the Senate (mostly).

Given the razor-thin margins in both the House and especially the Senate, I was already cautioning people to pare back expectations for the 117th Congressional Session. No, Medicare for All wasn't gonna happen. No, Medicare for America wasn't gonna happen. I already knew that even President Biden's own less-dramatic federal Public Option was unlikely to happen.

At the time, however, it did seem like at least a few Big Ticket items might make the cut, hopefully including:

Nevada

Earlier today I wrote about the imminent final passage of Colorado's much-ballyhooed "Colorado Option" bill to create a quasi-public option at the state level. If that happens, it would make Colorado the second state to implement such a system.

At the same time, however, Nevada is also in the process of moving their own Public Option bill through the state legislature. I honestly haven't been keeping track of this one lately (there's a lot of healthcare happenings to keep abreast of, folks!), but it sounds like a pretty big deal.

While (assuming it gets passed, signed and implemented) it won't have the bragging rights of being either the first or even second state to do so, it should have a much more important claim to fame: The first true state-level Public Option. As the great Louise Norris notes:

Washington already has a quazi public option program, and Colorado is considering one. Nevada's current legislation aims to create more of what people actually think of as a "public option"

Colorado

A couple of weeks ago I noted that Colorado was close to becoming the second state to implement their own state-level quasi-Public Option plan (Washington State was the first to do so a year ago).

I say "quasi-" because, similar to Washington's, Colorado's proposal isn't a "true" public option in the sense that the state itself would be administering a healthcare program by dealing directly with hospitals, doctors, drugmakers and clinics.

Instead, like WA's "Cascade Care" program, the state would instead design the parameters and requirements of the healthcare policies in question, but they would actually be administered by private insurance carriers and sold on the state's ACA exchange, Connect for Health Colorado. While it's hardly ideal, it would still be an important step forward.

Colorado

I haven't really been following the saga of Colorado's H.B. 1232 "Standardized Health Benefit Plan Colorado Option" bill as much as I should have been over the past year. The last time I wrote anything substantive about it was over a year ago...in fact, it was just a few weeks before the COVID hit the fan:

  • The issuers will offer the plans on and off the Exchange in the individual market.
  • The issuers will offer qualified health plans (QHPs) at Bronze, Silver, and Gold metal tiers.
  • The premiums of the plans will reflect facility reimbursement levels that vary by facility. The formula for determining facility-specific reimbursement levels was provided by DOI, utilizing hospital specific financial information provided by HCPF. Maximum reimbursement levels by facility are set between 155% and 218% of Medicare payment rates.
  • The plans will be offered beginning in calendar year 2022.
  • The state intends to apply for a 1332 waiver and use Federal pass-through savings for additional benefits or expanded coverage. The Baseline scenario presented below reflects the current federal and state regulatory market, including a state-based reinsurance program. The second scenario reflects the results of offering a Colorado Health Insurance Option with additional benefits, a premium wrap and a cost-sharing wrap.
Washington HealthPlan Finder

This just in from the Washington Health Benefit Exchange...

Pam MacEwan, CEO Washington Health Benefit Exchange (Exchange), issued the following statement today after the signing of Cascade Care 2.0 into state law:

“Today’s signing of the Cascade Care 2.0 bill sets the stage to improve the quality, availability, and affordability of the health plans offered through Washington Healthplanfinder. 

“This bill establishes a state premium assistance program that will benefit over 100,000 low-income Washingtonians struggling to pay for health insurance; increases statewide availability of the state’s first-in-nation public option program; and builds on the success of the high-quality Cascade Care standard plans – that have created average savings of $1,000 in out-of-pocket costs. 

UPDATE 4/13/21: An earlier version of this post had misinterpreted Linda Blumberg's estimate how much S.499 would cost--I thought that the $350 billion estimate was the gross projected 10-year cost without taking into account the impact of eliminating Silver Loading, but it turns out that it's the net cost after taking that into account as well. My apologies for such a bone-headed error.

Having said that, there's still the possibility of up to $196 billion in additional savings elsewhere, so it's still worth discussing the relative costs of both proposals and seeing whether both, or at least parts of both, could still be worked into the American Families Plan. I've significantly reworked the the wording of the post accordingly.

Washington PlanFinder

Two months ago, I noted that the Washington state legislature had decided to beef up their quasi-Public Option law to make the PO plans (called "Cascade Select") more robust and less expensive:

Let's step back a moment: There's actually up to three types of policies being offered depending on the carrier:

  • Qualified Health Plans (QHPs)...these are the normal policies which comply with ACA regulations offered by most carriers.
  • Cascade (Standard)...these are QHPs which also follow another state law passed last year (see below), and
  • Cascade (Select)...these are Standardized QHPs which are also public option plans.

Here's the distinction between Cascade "standard" and Cascade "select":

This is mostly an updated version of a post from last week, but there's some important new (potential) developments. Via Amy Lotven of Inside Health Policy:

The White House is expected to roll out the health care priorities for its two-part infrastructure package sometime this Spring, and the health piece potentially could move separately now that the Senate parliamentarian has agreed Democrats have another shot passing their priorities through a simple majority. While there appears to be consensus that the bill will expand, or make permanent, the Affordable Care Act tax credits from the American Rescue Plan, other policies are less clear and will likely depend on the amount of offsets lawmakers can glean from drug-pricing measures.

via Amy Lotven and John Wilkerson of Inside Health Policy:

Pelosi: Drug Pricing May Pay For Health Care Pieces Of Infrastructure Bill

House Speaker Nancy Pelosi (D-CA) said everything is on the table for the next legislative package that is expected to focus on infrastructure improvements and include health care provisions like a permanent increase to the Affordable Care Act tax credits — and she said the package likely will be paid for by tackling prescription drug prices.

...Pelosi said including House Democrats’ drug pricing bill, H.R.3, would pay for $500 billion of the cost of the infrastructure bill, part of which could be used to boost ACA tax credits and make ACA coverage more affordable. The savings also could also be used for other health-related efforts, she said. For example, House Energy & Commerce Chair Frank Pallone (D-NJ) has been working with Rep. Jim Clyburn (D-SC) to expand community health centers and to improve broadband services, which would support telehealth.

Back in late January, Senator Mark Warner of Virginia announced the introduction of a new-ish bill called the Health Care Improvement Act of 2021. Tell me if any of the major provisions look familiar:

  • Capping health care costs on the ACA exchanges
  • Establishing a low-cost public health care option
  • Authorizing the federal government to negotiate prescription drug prices
  • Allowing insurers to offer health care coverage across state boundaries
  • Supporting state-run reinsurance programs
  • Incentivizing states to expand Medicaid
  • Expanding Medicaid eligibility for new moms
  • Simplifying enrollment
  • Increasing Medicaid funding for states with high levels of unemployment
  • Reducing burdens on small businesses

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