What Happened, What You Missed: May 1-5, 2023 

Study: 340B Suppresses Uptake of Biosimilars 

Hospitals that participate in the 340B Drug Pricing Program see lower adoption of biosimilar drugs, according to a new study from Health Affairs.  Roughly a third of the nation’s hospitals participate in the 340B program, which requires manufacturers to provide discounts on most drugs administered in the outpatient setting to help safety-net hospitals, although the discounted drugs are reimbursed by Medicare at the same rate as they are in non-340B hospitals.  Researchers also found that 340B hospitals were associated with an overall increase in the use of increased use of pricier biologic medications.  To conduct the study, researchers examined 340B hospitals’ 2017-2019 Medicare claims data for two commonly used biosimilars. 

Vaccine Mandate for Employees at CMS-Certified Facilities Drops on May 11 

The requirement for federal government employees to be vaccinated for COVID-19 will end on May 11, the same day the COVID-19 public health emergency (PHE) is set to expire.  President Biden is expected to issue an executive order in the coming days to rescind the mandate, which applies to federal employees, contractors, international visitors, and people working at Centers for Medicare and Medicaid Services (CMS)-certified facilities.  Originally put in place in September 2021, the vaccine mandate was blocked by a federal appeals court in March 2023 after initially being upheld by a federal court in January 2023.  According to the Biden administration, nearly 98% of federal employees have been vaccinated against COVID-19. 

CBO Posts Estimate on TANF Work Requirements in Debt Ceiling Bill 

Congressional Budget Office (CBO) released an estimate that the work requirement provision in the recently passed House debt ceiling bill would lower federal expenditures, but increase the number of people without health insurance without increasing hours spent in employment.  H.R. 2811, the Limit, Save, Grow Act of 2023 raises work requirements for certain Medicaid recipients up to 80 hours per month and increases the age through which those persons must continue working.  CBO estimated that while this provision would save the federal government $109 billion over 10 years, it would increase costs to states $65 billion.   

FDA Clears First RSV Vaccine for Seniors 

On Wednesday, the Food and Drug Administration (FDA) approved Arexvy as the first vaccine for respiratory syncytial virus (RSV).  Manufactured by GlaxoSmithKline, the vaccine is administered as a single shot, and it approved only for adults ages 60 and older.  Assuming a Centers for Disease Control and Prevention (CDC) independent advisory committee votes to recommend the vaccine in June, Arexvy could be available to older adults as soon as this fall.  Although RSV is mostly associated with babies and young children, an estimated 159,000 American adults 65 and older are hospitalized each year with RSV, and an estimated 10,000-13,000 die as a result of their infection.  RSV vaccines for younger populations are currently under review and could made available by the end of the year. 

Sen. Ben Cardin to Retire 

Sen. Ben Cardin (D-MD) announced on Monday that he won’t seek a fourth term in the US Senate in 2024.  A longtime fixture in Maryland politics, Cardin was first elected to the Maryland House of Delegates while he was still a student at the University of Maryland Carey School of Law.  He went on to become the chamber’s youngest speaker in 1979, and in 1986, he was elected to represent Maryland’s Third Congressional District in the US House of Representatives, where he served until 2007.  That same year, Cardin became Maryland’s junior senator in the US Senate, where he would serve on the powerful Finance Committee.  During his tenure in the Senate, Cardin has been a strong proponent of oral health, and he frequently sponsored legislation to make dental care a covered benefit under Medicare.  Cardin’s announcement has set off what’s expected to be a competitive Democratic primary to succeed him.  While no formal announcements have been made, Reps. Jamie Raskin (D-MD) and David Trone (D-MD) are seen as possible candidates, as well as Prince George’s County Executive Angela Alsobrooks. 

ICYMI: Freshman Lawmakers Launch Congressional Sneaker Caucus 

Freshman Rep. Jared Moskowitz (D-FL) launched the Congressional Sneaker Caucus last week with fellow freshman Rep. Lori Chavez-DeRemer (R-OR).  Moskowitz and Chavez-DeRemer are among a small but growing number of lawmakers and staff who are opting to wear sneakers over more traditional dress shoes on Capitol Hill.  Both members of Congress say they intended to use the caucus as a way for sneaker fans on both sides of the aisle to find common ground.  They also hope to host meetings and partner with manufacturers on philanthropic activities. 

The Calculations Change – But the Insolvency Dilemma for Medicare and Social Security Remains the Same  

The 2023 Medicare Trustees Report showed a positive trend for the Hospital trust fund (Part A) but the Social Security Trustees noted a worsening trend for in their report.  For Social Security, insolvency is coming 1 year earlier than last year (in CY 2032, rather than CY 2033), due to inflation, lowering of the GDP, and labor productivity.   

For Medicare, the Hospital trust fund added 3 more years of solvency, moving the point at which all benefits could be paid at current levels from 2028 to 2031.  This improvement was due to “lower projected health-care spending stemming from updated analysis that uses more recent data” or, in other words, they changed the way the assumptions were calculated.   

Three other factors helped push out the timeline for the Hospital trust fund: 

  1. Those beneficiaries that died from COVID-19 were the sickest with more comorbidities – so the remaining Medicare population is “healthier” as a percentage – which leads to lower overall projected spending.  
  1. More dual eligible beneficiaries have been moving into Medicare Advantage plans in the past few years and. as duals are more expensive, this shift has resulted in savings.  The report highlighted that the additional dual-eligible enrollments [in Medicare Advantage] have decreased the average fee-for-service per capita cost– affecting, in turn, the trends for inpatient hospital, SNF, and home health spending..   
  1. The Comprehensive Care for Joint Replacement program (CJR) in Medicare has led to a larger than expected shift of knee and hip replacements from inpatient to outpatient care which resulted in savings.   

Trustees reiterated that the Medicare pay rates for physicians are not keeping up with inflation and costs, which could affect beneficiaries’ access to care.  American Medical Association President Jack Resneck said, “MedPAC and the Trustees have provided lawmakers with a legislative agenda for this year. Congress should adopt a 2024 Medicare payment update that recognizes the full inflationary growth in health care costs…to ignore this would be malpractice.”  

To improve the solvency of the Medicare trust fund, the Trustees urged Congress to act on President Biden’s ideas of increasing taxes for those making over $400,000 and allowing Medicare to negotiate rates on an expanded list of prescription drugs.  House Speaker Kevin McCarthy has said that Biden’s tax proposals are “completely unserious” and that, “Washington has a spending problem, NOT a revenue problem.” 

So, is this the year that Congress and the administration address Medicare and Social Security insolvency?  The dilemma remains the same – they can ignore the warnings, or they can increase taxes and/or cut government spending.  We also have the looming debt ceiling to address.  For now, both sides are playing politics.  The Biden Administration has repeatedly said it only wants a “clean” debt ceiling increase knowing full well that they need to work with Congress to make any significant changes to impact the trust funds or raise the debt ceiling.  House Republicans want cuts to spending, and to require these cuts be part of any agreement to raise the debt ceiling.  Although they say Medicare and Social Security are off the table, news agencies have reported that multiple proposals to cut Medicaid are circulating.  House Republicans can’t agree among themselves on what they want, and that 7-vote margin doesn’t make things easy for them.  So, we wait.  And we are pretty sure you’ll have enough time to read the reports before any of these problems are solved.  

What Happened, What You Missed: April 3-7, 2023 

Final Rule Prohibits Deceptive Marketing of MA Plans 

Medicare Advantage (MA) plans and Medicare prescription drug plans will face tougher requirements on marketing plans, according to a rule finalized by the Centers for Medicare and Medicaid Services (CMS) on Wednesday.  The final rule is part of an overarching effort by the administration to crack down on deceptive and misleading marketing of MA plans, which have been growing in popularity.  Nearly half of Medicare beneficiaries are enrolled in MA plans, which are operated by private insurers.  According to the rule, MA plans can no longer run advertisements that use the Medicare name or mention the federal government deceptively. Ads are also prohibited from running without mentioning a specific plan name.  Aside from addressing deceptive marketing, the final rule streamlines prior authorization requirements by requiring prior authorization approval for care to remain valid for as long as “medically necessary” to avoid disruptions in care. 

ACA Premiums Up 3.4% Thanks to Inflation, Higher Spending 

Affordable Care Act (ACA) premiums rose in 2022-2023 due to inflation and higher health care spending, according to a recent analysis by the Robert Wood Johnson Foundation (RWJF).  The higher premiums mark the reversal of a trend towards gradually lower premiums over the past few years.  The analysis notes that inflation will continue to put upward pressure on premiums, particularly due to high labor costs.  Another reason for higher premiums cited in the report was uncertainty over whether the ACA’s enhanced premium tax credits would be extended.  Over 16 million Americans enrolled in marketplace plans in 2023.  

NCI Releases National Cancer Action Plan 

To help achieve the administration’s goal of “ending cancer as we know it,” the National Cancer Institute (NCI) released its National Cancer Plan on Tuesday.  The plan is centered around eight goals: preventing cancer, detecting cancer early, developing effective treatments, eliminating inequities, delivering optimal care, engaging every person, maximizing data utility, and optimizing the workforce.  According to NCI, the framework is intended to engage all stakeholders involved in treating cancer, including health care providers and researchers.  The Biden administration has notably laid out a goal of reducing the cancer death rate by 50% over the next 25 years. 

Gallup: More Americans Concerned about Health Affordability, Drug Use  

A growing number of Americans are concerned about drug use and affordable health care, according to a new Gallup survey.  While inflation and the economy were the top two key issues the respondents were worried about, health care affordability and drug use saw a respective 5% and 8% increase in concern compared to a 2022 poll.  The poll results come amid growing fears over high health care costs and a near-record high in drug overdose deaths.  Gallup conducted the survey in March 2023 and polled over 1,000 US adults.   

ICYMI: The Library of Congress Reading Room Will Soon Be Open to Visitors 

Currently, only individuals with a photo ID library card are allowed to visit the main reading room of the Library of Congress.  However, starting next Tuesday, the Library of Congress will kick off a new pilot program that will allow visitors to access the ornate reading room during two hour-long periods on Tuesday through Friday.  The main reading room sits below a 160-foot-high dome that’s painted with imagines representing human understanding and intellectual progress.  Additionally, the library is changing its rules to allow non-flash photography in the reading room.  Visitors are still required to reserve timed passes to access the Library of Congress.   

Fixing Medicare’s Insolvency Requires Both the Administration and Congress – So Where Are They?

The 2022 Medicare Trustees Report was full of grim news – namely, that the Hospital Insurance (HI) Trust Fund is projected to hit insolvency by 2028.  Given the serious implications insolvency could have on access to care, stakeholders have been begging Congress and the administration to do something.   

However, Washington has avoided serious attempts to address the HI Trust Fund’s insolvency for years, primarily because the most obvious fixes would be unpopular among voters.  Since the payroll taxes predominantly finance the HI Trust Fund, lawmakers could opt to raise payroll taxes to add more years to the fund.  Unfortunately, higher payroll taxes would mean less take-home pay for employees and would put pressure on employers, which sounds like a sure-fire way to anger the electorate.  Inflation and general concerns over cost-of-living issues would also exacerbate the impact of higher payroll taxes on workers. 

Lawmakers could also maximize existing revenue streams by cutting Medicare spending, but this would spark political backlash from the health care sector.  The pandemic has stretched hospitals’ operating margins even thinner and reducing already-low Medicare reimbursement rates would make life even more difficult for providers.  Medicare could shift costs to beneficiaries in the form of higher deductibles and co-payments, but this would once again be political damaging as seniors will then have to grapple with the combined effects of higher health care costs and inflation.

The federal government could also incur Medicare savings by making the program more cost effective, but that’s no easy task.  During a series of congressional hearings of the Fiscal Year (FY) 2023 budget request for the Department of Health and Human Services (HHS), Secretary Xavier Becerra repeatedly said value-based payment models could be used to save Medicare dollars and extend the HI Trust Fund’s solvency.  Unfortunately, these payment models haven’t had much of effect on Medicare’s finances.  Out of the 40 payment models launched by HHS over the past 10 years, only five have delivered “statistically significant savings.”  Even if all value-based payment models were to start immediately reducing costs, it would likely take years for these savings to make a serious dent on Medicare’s finances.

Congressional Action in Sight?

The urgency of addressing Medicare Part A’s finances isn’t lost on members of Congress.  During Becerra’s appearances before congressional committees last spring, Republican lawmakers repeatedly questioned the secretary about the administration’s plans for addressing the HI Trust Fund’s pending insolvency.  In response, Becerra repeatedly told lawmakers that they will have to work with HHS to develop legislation to improve the outlook for the HI Trust Fund. Rep. Adrien Smith (R-NE), one of the GOP members to question Becerra about the HI Trust Fund, penned a June 2022 op-ed that underscored the need for “bipartisan action” to shore up Part A revenue.

It’s not that Congress hasn’t taken action in the past.  There is a statutory requirement for the administration to submit a report to Congress when more than 45% of Medicare hospital spending is projected to come from general revenue – not the HI Trust Fund – within seven years.  However, as both Smith and Becerra confirmed in the recent HHS budget hearings, the Biden administration has no plans to meet this requirement. 

Fortunately, a viable proposal to address the HI Trust Fund has emerged in recent days.  On July 7,  Senate Democrats reached an agreement to extend the solvency of the HI Trust Fund to 2031 by closing a Net Investment Income tax (NIIT) loophole involving pass-through businesses.  Primarily targeting high-income earners, the proposal to close the tax loophole was first put forth by the Biden administration back in 2021 as a part of its Fiscal Year (FY) 2022 budget request.   Senate Democrats are reportedly including this proposal in a broader reconciliation package to secure the support of Sen. Joe Manchin (D-VW), whose decision to withdraw support from last year’s package caused it to fall apart. 

The proposal from Senate Democrats is getting attention in the House, too.  On July 11, Rep. Lloyd Doggett (D-TX) introduced legislation that would similarly close the NIIT loophole.

However, the proposal is still in its infancy at this point, and it doesn’t have a strong likelihood of becoming law.  The Senate Parliamentarian has yet to complete the review of the new reconciliation proposal, and as last year has shown, delicate negotiations on a new reconciliation bill could collapse at any point.  However, as the Senate attempts to revive a reconciliation bill and the comments made during recent congressional hearings show that lawmakers are definitely concerned about Part A’s finances and recognize the importance of taking action before it’s too late.  

The Medicare Trustees Report Is Still Bad News

The Medicare Hospital Insurance (HI) Trust Fund will become insolvent in 2028, according to the latest report by the Medicare Board of Trustees in June 2022.  Last year’s report projected the HI Trust Fund’s insolvency date to 2026, which means the fund now has just two additional years of breathing room. 

In brief, the HI Trust Fund funds Medicare Part A, which reimburses providers for inpatient hospital services, hospice care, and skilled nursing facility and home health care services and is funded primarily through payroll taxes.  In contrast, a separate account known as the Supplementary Medical Insurance (SMI) Trust Fund funds physicians and other outpatient services under Part B and prescription drugs under Part D and is funded through general tax revenue and the premiums enrollees pay.

Better-than-expected recovery in economic growth, pay, and employment convinced the Medicare trustees to push out the HI Trust Fund’s insolvency date by two years.  The trustees also noted in their report that the COVID-19 pandemic isn’t expected to have a serious impact on Medicare’s finances

New projections that the HI Trust Fund will become insolvent two years later than initially expected isn’t the good news it seems to be.  In fact, the HI Trust Fund is in a world of trouble.  As the trustees noted in their report, there is much uncertainty on the economy, population demographics, and access to health care that indicate serious problems with the HI Trust Fund’s estimates on future expenditures, and there may be cause for concern regarding the report’s projected insolvency date. 

For example, the trustees made the economic projections that were included in the report back in February 2022 – right before COVID-19 cases started to shoot up again and inflation began to climb.  An analysis from the Committee for a Responsible Federal Budget says the trustees’ estimates appear to “understate inflation and overstate real economic growth.”  If inflation and poor economic growth is persistent into next year, the report might estimate a sooner insolvency date in their 2023 report.

Furthermore, the HI Trust Fund still faces a massive shortfall to the tune of a $350 billion deficit over the next 10 years.  The trustees project there will be a shortfall of 0.7% of payroll, or 0.3% of Gross Domestic Product (GDP).  This means either a 24% payroll tax or a 15% spending cut is required to prevent the fund from becoming insolvent.

Additionally, Medicare spending is expected to quickly increase.  According to the report, Medicare spending is projected to grow from 3.9% of GDP to 6% by 2040 before hitting 6.5% around 2070.  Medicare Advantage (MA) is cited as a primary driver of rising spending, as MA plans are argued to be more expensive than traditional Medicare.  On top of this, an aging population is driving overall health care spending higher, which includes the kind of inpatient services that Part A pays for. High spending means addressing the HI Trust Fund’s finances – whether by upping payroll taxes or cutting spending – is only going to get harder down the road.

There is some disagreement on how dire the situation is for the HI Trust Fund’s finances.  Even if the HI Trust Fund were to be depleted in the next few years, it would still pay roughly 90% of its current level.   However, this is far from an ideal scenario.  Insolvency essentially means Medicare Part A payments to providers would be reduced to levels that could only be covered by incoming tax revenues.  By only being able to pay nine-tenths of current program expenditures, an insolvent HI Trust Fund would affect providers by either delaying payments for all providers or having Medicare reimburse at a decreased rate for Part A careEither scenario could result in many seniors potentially losing access to care.    

Thus, the HI Trust Fund going insolvent is a big deal, and lawmakers will have to get their act together at some point to shore up Medicare’s finances.  It is important that lawmakers act sooner rather than later to bolster the trust fund by reducing spending, increasing revenues, or some combination of both.  Acting sooner would also boost the public’s trust in Medicare and stabilize the fund, heading off scenarios where providers face declining reimbursement and beneficiaries could lose access to care.

Is the Future Now for a Lower Medicare Eligibility Age?

Some birthdays are more special than others.  Turning 16 means a drivers license is within reach and turning 18 grants the ability to cast a ballot.  For many Americans, turning 65 means they are finally eligible for Medicare coverage.  However, this milestone for turning 65 could soon change, as top Democrats weigh the possibility of lowering the eligibility age for Medicare.

On April 9, 2021, President Joe Biden reiterated his goal to lower the Medicare eligibility age to 60, a policy position he first laid out as a presidential candidate in 2020.  According to the President, a lower eligibility age would help Americans retire early and provide insurance coverage for those who are unemployed. 

Allowing Americans under 65 to enroll in Medicare isn’t exactly a new proposal; for over a decade, many Democrats have suggested a Medicare buy-in that would allow those five to 10 years below the current eligibility age to receive coverage by paying a premium.  Additionally, many of these previous proposals called for people not to enroll in Medicare itself, but rather in a Medicare-like plan operated by the federal government. 

The President’s proposal, however, would simply entail lowering the eligibility age, thereby allowing everyone within the expanded age group to enroll in Medicare.   

What About Bernie?

Long-time single-payer proponent Sen. Bernie Sanders (I-VT) has also been pushing for a lower Medicare age.  His plan is more far-reaching than Biden’s in that it would lower the eligibility age to 60 or 55 and provide dental and vision coverage. 

Cha-Ching

Lowering Medicare’s eligibility age could be pricey.   The Journal of the American Medical Association (JAMA) estimates that there are currently 20 million Americans aged 60-64 with commercial insurance, Medicaid, or no insurance coverage at all.  With an estimated average $5,000 per year in per-capital spending on this age group, JAMA projects an infusion of 20 million beneficiaries to Medicare could cost the program up to $100 billion per year. 

However, one could surmise that the price of lowering Medicare eligibility could be, at least in part, offset by potential savings to the government that could result from persons receiving subsidized coverage through an Affordable Care Act (ACA) plan switching to Medicare coverage. For instance, should persons 60-65 years who are enrolled an ACA plans shift into Medicare coverage, what impact would this have on risk pools and could premiums for ACA plans, overall, drop in price as a result? It will be interesting to see how the Congressional Budget Office (CBO) projects this budgetary impact. 

Medicare Insolvency?

Regardless of whether any shifts from ACA coverage to Medicare coverage could offset the price of the proposal, there remains questions as to what the impact may be on the Medicare Hospital Insurance Trust Fund, which is projected to reach insolvency by 2024

The growth in Medicare spending has been a concern for years, leading for some to call for the program’s eligibility age to be RAISED in order to save money.  According to a Congressional Budget Office report from 2011, raising the Medicare eligibility age to 67 would save the program $125 billion over a decade.  Since then, several prominent Republicans including then-2012 presidential candidate Mitt Romney have called for the program’s eligibility age to be raised by two years. 

Proponents of a higher eligibility age say the move would be a better targeting of the government’s resources, given the rise in the nation’s life expectancy since Medicare was first created and the fact that younger Medicare beneficiaries are less likely to have health problems than their older counterparts.  Others have said a higher eligibility age could keep more Americans in the workforce.  Meanwhile, opponents say raising eligibility age would simply shift costs from Medicare onto commercial insurers, Medicare, and individual Americans. 

Opposition

But lowering the age for Medicare eligibility is on the table now, not raising the age.  So where do health care industry stakeholders stand on lowering the Medicare age?  They aren’t happy.  Hospitals, for instance, may have the most to lose from a lower Medicare eligibility age because Medicare pays hospitals at a lower rate than commercial insurers.  Additionally, the addition millions of new Medicare beneficiaries would give Medicare considerably more bargaining power when setting prices with hospitals and other providers, including nursing homes and dialysis facilities. 

For insurers, there could be winners and losers, depending on the strength of any given company’s Medicare Advantage (MA) market share.  MA has been one of the fastest-growing lines of business for insurers, and with new Medicare beneficiaries disproportionately more likely to choose MA over traditional Medicare, a lower eligibility age could mean a windfall for insurers with MA plans.  However, for insurers who have focused more heavily on their group market business, they could see insureds shifting to MA as a loss, unless they are able to become competitive in MA markets.

What’s Next?

It is difficult, given Democrats’ small margins in the House and Senate, to ascertain a quick path to enactment of dropping the eligibility age to 60.  Some in the caucus will argue it is not enough, that a public option is what is needed.  Others may view this as an incremental win towards government-run healthcare.  However, with the prospect of using the budget reconciliation process again, at least one more time and possibly two, in play, as well as Speaker Nancy Pelosi (D-CA) recently signaling support for lowering the Medicare age, a more fleshed-out proposal that expands Medicare access and contains other Democratic health priorities has the potential become the party’s newest target for policy action.  

Despite Reintroduction, Medicare for All, Medicare-X Proposals Face Limited Odds

With control of the White House and both chambers of Congress, Democrats are newly emboldened to expand access to health care coverage.  A group of progressives in the House are making another attempt at Medicare for All, while moderates in the House and Senate want to expand coverage via a public option.  However, lack of Republican support for either proposal means both are likely doomed.

Medicare for All

On March 17, Reps. Pramila Jayapal (D-WA) and Debbie Dingell (D-MI) introduced the Medicare for All Act of 2021 (H.R. 1976).  The bill has so far attracted 109 co-sponsors, indicating the highest-ever level support in Congress for a national health insurance program.  While a Medicare for All bill has never advanced out of a congressional committee, advocates for single-payer feel the COVID-19 pandemic has laid bare the inefficiencies of the current health care system and made their case even stronger.  In a press release, Rep. Jayapal touted Medicare for All as a solution for the millions of Americans who lost employer-sponsored coverage because of the pandemic.    

In addition to being a total non-starter with Republicans, Medicare for All faces two major obstacles.  One is resistance from health care stakeholders, who have long thrown cold water on single-payer proposals.  The Partnership for America’s Health Care Future, a coalition of insurer and provider organizations, issued a recent statement saying Medicare for All is unaffordable and would lead to lower quality.  Additionally, the US Chamber of Commerce said in press release that Medicare for All would reduce access to providers and hospitals.

The second major obstacle comes from within the Democratic party itself.  President Biden has clearly stated his preference for expanding access to coverage through a public health insurance option, one that moderate and centrist members of the party share.  While Biden has gradually moved leftward over the course of his political career, it is extremely unlikely he would champion a health care proposal that remains divisive among members of his own party. 

Medicare X

Closer to the President’s ideological preferences for expanding coverage is the Medicare X Choice Act of 2021 (S. 386/H.R. 1227).  First introduced by Sens. Michael Bennet (D-CO) and Tim Kaine (D-VA) in 2017, this proposal would allow all Americans to purchase a public health insurance plan based on the Medicare program that would reimburse providers at the same rate Medicare currently does and allows patients to access providers that accept Medicare.  Supporters of Medicare X tout it as a more realistic proposal to achieve universal coverage that would be less disruptive to the health care system.  Additionally, a January 2020 poll from the Kaiser Family Foundation found a public option-based proposal is more favorable to a greater number of Democrats and Independents than Medicare for All.

The fact that Medicare X/a public option enjoys higher favorability than Medicare for All does not necessarily improve its odds of passage.  Medicare X is similarly unpopular with Republicans and given the party’s razor-thin control of the Senate, Democrats would likely have to use budget reconciliation to advance any kind of public option proposal.  While reconciliation was used to pass the Affordable Care Act (ACA) in 2010, it remains unclear if a proposal like Medicare X would meet the strict budgetary criteria required to be considered under budget reconciliation.  Furthermore, Congress is limited to the number of times it can use budget reconciliation in any given year, and Democratic leadership have yet to make any prognostications about what proposals it could consider under budget reconciliation in the future. 

Implications

While Medicare for All and Medicare X are unlikely to become law anytime soon, a key implication of both proposals is their potential to hasten divisions between progressive and moderate Democrats.  Since the start of the Biden Administration, both wings of the party have largely set aside their differences to advance key components of the President’s agenda, including cabinet nominations and a sweeping $1.9 trillion COVID-19 relief package.  While the House, and some argue the Democratic Party, have moved more to the left – it remains clear that moderate Democrats in the Senate maintain a high level of power over the fate of any legislation in the upper chamber.  Disagreements over health care proposals have the potential to disrupt broader legislative goals from the White House, such as immigration, infrastructure, or tax reform.