Joe Biden wants to improve Obamacare. Here’s how his plan works.
The Democratic president-elect has put forward a plan that would build on the Affordable Care Act (ACA). That means much of the existing US health care system would remain in place: Most working people would continue to get their health insurance through their employer, Medicare and Medicaid would be preserved, and the ACA would be expanded.
But he’d almost certainly need a Democratic Senate to pass it. Right now, Republicans appear to have the upper hand. Democrats may need to win two Georgia Senate seats in a January runoff in order to reach a 50-50 tie in the Senate; Vice President-elect Kamala Harris, in her role as president of the Senate, would give the chamber to the Democrats.
So politically, there is still a big question about how much Biden will be able to do on health care. But policy-wise, we know what he’s proposed: Biden’s plan — Bidencare, as he’s called it — would patch up holes in the 2010 law’s infrastructure and give millions of uninsured people coverage. By some outside estimates, every person who resides legally in the United States would have health insurance under the proposal. The people left uninsured would be an estimated 6.5 million undocumented immigrants living in the US today.
The signature piece of Biden’s plan would a public option. This Medicare-like government insurance plan would be sold on Obamacare’s marketplaces, where roughly 12 million Americans buy their own insurance. It would add more competition to areas where only one or two other insurance plans are available.
The public option would also cover low-income Americans who are currently denied insurance because of their state’s opposition to Obamacare. A dozen states have refused to expand Medicaid through the health care law, which leaves about 4 million people in or near poverty uninsured. Those people would be automatically enrolled in Biden’s public option.
The Biden plan does not, however, make it easy for every American to buy into the public option. For most of the 150 million people with employer-sponsored coverage, it probably wouldn’t make sense for them to join the new program. Biden’s plan does not allow them to use the money their employer pays for their insurance premiums to buy into the new public option, nor are the employers allowed to choose to put their workers on the government plan.
This is likely to limit the movement from large group coverage to the public option, leaving most people still reliant on their job for their health insurance. The Kaiser Family Foundation estimates that 12 million people with employer coverage — less than 10 percent of the total employer-based market — would find the public option to be a cheaper alternative for them.
Biden would also make other technical changes to Obamacare. He would increase the generosity of the government subsidies that lower premiums for people who buy on the marketplaces. He would also make Americans with higher incomes eligible for that assistance, and their monthly premiums would drop dramatically under his plan.
The Urban Institute projected that a proposal similar to Biden’s would cover all legal residents in the United States — that would be about 24 million currently uninsured people gaining coverage, based on Congressional Budget Office estimates.
It’s clear Biden has a plan that would cover millions of people and likely lower premiums for most. What’s unknown is whether he and congressional Democrats will prioritize a major health care reform bill early in the Biden presidency. Some senior Democrats believe the party should use their newfound power to repair the holes in America’s social safety net that Covid-19 exposed. Others think Democrats should be more targeted in their approach, keeping pressure on Republicans to cooperate on a bipartisan basis.
If the GOP holds the Senate, all this discussion is moot. A big health care bill isn’t passing on Mitch McConnell’s watch.
Regardless, the incoming Biden administration may be interested in undoing much of Trump’s executive actions on health care once the president-elect takes office. A Biden health department could target the expansion of short-term insurance and Medicaid work requirements. There is a long list of anti-abortion and other women’s health policies that will likely be reviewed as well.
“Some of Biden’s early efforts in health care may be simply undoing what Trump did,” Larry Levitt, executive vice president at the Kaiser Family Foundation, told me. “Some of these things could be done quickly, while others would take time if they involve undoing actual regulations.”
Biden’s election portends a new direction in US health care policy. The question we can’t answer yet is how meaningful the change will be.
Author: Dylan Scott