Medicaid, Obamacare Expected to Top Democrats’ Early Health Agenda, Former Aides and Policy Analysts Say

President-elect Joe Biden’s narrow path to enact health care legislation in the next two years got a little bit wider this week.

Democrats are set to take control of Congress and the White House for the first time since 2011, and while COVID-19 is expected to dominate their agenda early on, lawmakers could take their first stabs at longtime priorities like expanding health coverage and lowering costs in the new year. But with a razor-thin majority in the Senate, congressional Democrats will face hurdles both political and procedural as they decide how ambitious to be with their early health care agenda.

“Things will get real and practical pretty quickly,” said Kim Monk, a former Senate health policy aide and founding partner at Capital Alpha Partners LLC, a health care policy analysis group.

Early on, Monk anticipates congressional Democrats will introduce a COVID-19 package with some health provisions, including an increased federal funding match for state Medicaid programs, 12 months of continuous eligibility for Medicaid coverage and additional funding for providers and COVID-19 vaccination efforts.

Beyond COVID-19, Democrats will likely push to expand on the Affordable Care Act to help people afford coverage, said Cynthia Cox, a vice president and ACA researcher at the Kaiser Family Foundation. That could include increasing subsidies for people who already get them, as well as expanding subsidies to upper-middle income people who still find coverage unaffordable and to low-income people who would be eligible for Medicaid in states that have not expanded the public health insurance program.

Congress could also address the so-called family glitch, where families are locked out of subsidies through the exchange because one member is deemed to have an affordable coverage option through an employer.

“We're more likely to see those ACA fixes, I think, than we are to see real movement on the public option or lowering the Medicare age,” Cox said.

While the public option, which Biden proposed as a Medicare-like plan that anyone could buy into, is likely out of reach, a narrower version of the program could be on the table to cover low-income people in states that have not expanded Medicaid, said Matt Fiedler, a fellow at the USC-Brookings Schaeffer Initiative for Health Policy who worked on health care policy in the Obama administration.

“The Biden campaign plan did envision its public option covering the Medicaid coverage gap population,” Fiedler said. “A targeted public option like that might not be out of the question.”

Proposals to tackle the bipartisan issue of maternal mortality could also pass, Cox said, such as allowing states to extend Medicaid coverage for a full year postpartum. And Democrats could take steps to nullify a legal challenge to the ACA that the Supreme Court is expected to rule on this summer.

Timing remains a question. Some health provisions may be included in pandemic relief legislation, but if not, they could become stand-alone legislation or tacked on to a budget reconciliation bill, which would only need a 51-vote majority to pass and could be accomplished with a tie-breaking vote from Vice President-elect Kamala Harris. But such legislation must remain budget-neutral, and it’s unclear exactly which health provisions fit in those parameters.

“People talk about reconciliation like it's an easy thing — it's not,” Monk said. “But with a 50-50 majority, I think that's what Democrats are looking at.”

The procedural route could also affect how ambitious Democrats are with their health care agenda. Lowering drug costs, for example, has been a bipartisan priority for years, and proposals to do so could be used as a way to bring in savings for other items in a budget reconciliation bill. Lawmakers will also have to navigate party splits and compromise with Republicans to pass other legislation.

Senate Republicans may be open to proposals to improve the ACA, said Rodney Whitlock, a vice president at McDermott+Consulting and a former health aide to Sen. Chuck Grassley (R-Iowa). “But the more you talk about Medicare expansion, the more you talk about public option, you stop talking to Republicans.”

There are some steps Biden can take on his own. Health policy observers say some of the most consequential reforms of the next two years are more likely to come via administrative action than legislation, such as executive orders rolling back Trump-era policies to weaken the ACA, state Medicaid and ACA waivers and demonstration projects from the Center for Medicare and Medicaid Innovation.

The incoming administration will also be grappling with another variable that could shift the focus in the early days of Biden’s presidency and the legislative session: the Jan. 6 attack on the Capitol.

“Biden's been dealt a very difficult hand, where he is not only going to have to address the pandemic on day one, but also an apparent crisis of democracy,” Cox said.