On Thursday, January 28, President Biden signed an executive ordering directing the federal government’s opening of a special enrollment period for Affordable Care Act (ACA), exchanges serving 36 states. This is a measure to increase coverage for those who are not insured. Many of the 14 states that manage their own marketplaces have reopened enrollment.
It is not clear how meaningful this measure will be. The number of sign-ups for the extra enrollment period in a few states last year was quite low.
The Biden Administration’s proposals won’t be a good fit for those who are looking for a complete overhaul of the U.S. health system, such as Medicare for All. Nonetheless, some changes can be made to public programs like the ACA, Medicare, and public health.
Nearly 75% of the nearly 30 million uninsured stated that the cost of insurance was the biggest barrier to their coverage. The number of people without insurance has increased due to the 2020 economic collapse. According to the Commonwealth Fund, as many as 15,000,000 people could have lost their employer-sponsored healthcare coverage. Others will have alternative coverage through another job, Medicaid, or the federal ACA Marketplace.
A second item in the executive orders on the establishment of a special enrollment period is the resumption of federal funding for outreach and advertising. Trump Administration had reduced such funding. Increasing advertising will increase the likelihood that more people who are unemployed will seek alternative coverage through the federal ACA exchange.
But, Biden’s proposal to strengthen the ACA is not possible through executive order. Biden suggested that marketplace premiums be limited to 8.5% for all income levels during his campaign. This could have a major impact on enrollment. Congress would also have to approve proposals to increase premium tax credits, remove the 400% federal poverty level limit on tax credit eligibility, reduce deductibles, and co-payments to subsidized beneficiaries.
Biden is likely to seek to reinstate the penalty attached to the ACA’s individual mandate. This mandate requires people to have insurance and was removed as part of the December 2017 Tax Cut legislation. Biden stated that he would like the penalty to be reinstated for not being covered. Biden could do this by issuing an executive or legislative order. Or, Congress could amend the legislation so that the penalty is reinstated in the existing ACA law.
During the campaign, Biden’s team emphasized the need for a public option to strengthen the ACA. Americans would be able to choose whether they wanted to sign up for a “Medicare-like” plan or keep their private coverage. Anybody without insurance could automatically be enrolled. Individuals who cannot afford private insurance or don’t feel satisfied with their current coverage could be eligible for the public option. The costs of adding a publicly available option, the reimbursements for hospitals and other healthcare providers, as well as whether physicians and hospitals would have to accept all patients covered by the public option are not yet known.
Biden also proposed a significant expansion of ACA. This would include approximately five million more people who live in the 14 states that have not expanded Medicaid. These are people who make too much to qualify for Medicaid but not enough to afford their own insurance.
Biden’s Medicare for More proposal is another option. It aims to expand Medicare and lower the eligibility age to 60. An estimated 20 million Americans would become eligible for Medicare. It would be voluntary to enroll in Medicare between the ages 60 and 64. Employers would not be allowed to drop newly eligible Medicare beneficiaries from their plans. Lower-income beneficiaries would receive cost-sharing and premium subsidies.
In the ideal scenario, Medicare would lower per capita costs by adding younger, more healthy people to its risk pool. In the same way, taking middle-aged people out of marketplace risk pools could make insurance more affordable for younger adults.
The Biden Administration also stated that it will prioritize public healthcare as a backdrop for the changes that are expected to improve access to healthcare. This is partly due to the Covid-19 epidemic. As part of the recovery plan, Biden announced in January that 100,000 public health workers would be involved in vaccine outreach. More importantly, the Administration wants to improve the sustainability of public healthcare moving forward. This is a revival of an area that has been neglected in healthcare.