Court victory feeds Democrats’ hopes on healthcare
But plans to expand on Obamacare and rein in drug costs may not all make the cut.
They want to expand insurance coverage for working-age people and their families, add new benefits to Medicare for older people, and reduce prescription drug costs for patients and taxpayers.
But healthcare is expensive and there’s concern about deficits. With Democrats holding only bare majorities in Congress, a winnowing-down of expectations seems likely later this year.
For now, Democrats are savoring Thursday’s Supreme Court decision upholding the healthcare law, widely known as Obamacare, for the third time in a decade. The latest challenge to the law had been seen as a stretch by many legal experts, but a 7-2 vote from the conservative court was still unexpected.
“I think Democrats once again know they have a moment in time, and they want to make the most of it,” said Kathleen Sebelius, Health secretary under President Obama during the passage and implementation of the health law. “I think people are fired up and ready to go.”
There is no shortage of proposals. Some, such as a plan to authorize Medicare to negotiate prescription drug prices, could potentially save hundreds of billions of dollars, depending on how the proposals are structured. But coverage and benefit expansions could cost just as much, or even more.
Complex budget procedures that Democrats plan to use to pass President Biden’s domestic agenda by a simple majority vote in the Senate may also limit the types of proposals that can be considered.
“There is a sorting going on,” said John McDonough, a professor at Harvard’s School of Public Health who was a senior Democratic aide in the Senate during the creation of Obamacare. “Not all of these ideas are viable, but you don’t always know which ones at the start.”
Democrats’ ideas fall under two big headings: expanding coverage and benefits through public programs such as Medicare and Obamacare, and using the power of government to rein in the price of prescription drugs. In theory, savings from prescription drugs could pay for expanding healthcare without adding to the deficit or raising taxes.
“These are not proposals in the single-digit billions,” said Marc Goldwein, senior policy director for the Committee for a Responsible Federal Budget. “We’re talking $100 billion, $200 billion or more — but in different directions. The more they save, the more they can spend.” His group advocates for reducing federal deficits, and Goldwein adds that he hopes lawmakers “abide by the basic rule that you pay for what you’re willing to spend.”
Early on, a hierarchy of proposals has started to emerge.
At the top of the list, and most likely to be included, is Biden’s plan to permanently extend more generous HealthCare.gov insurance subsidies. They’re provided through next year under his COVID-19 relief bill. The price tag to extend them is estimated at $163 billion over 10 years.
Democrats also want to find a way to cover more than 2 million low-income people in states, mainly in the South, that have declined to expand their Medicaid programs with federal help. Fixing that is not just a matter of pumping more federal money in, due to arcane legal issues.
And there’s the goal of authorizing Medicare to negotiate prescription drug prices, which also has an uncertain outlook.
Under Speaker Nancy Pelosi (D-San Francisco), the House passed a robust bill to allow such price negotiations almost two years ago, and the issue remains a priority for Democrats. It was projected that negotiations under the 2019 legislation would have saved the government over $450 billion over 10 years, but Pelosi’s tough approach to the powerful pharmaceutical industry is seen as a problem for some Senate Democrats.
The catch is that without big savings from prescription drugs, it gets harder to deliver other parts of Democrats’ healthcare agenda. For example, adding dental, vision and hearing benefits to Medicare could cost about $360 billion over 10 years.
Some ideas that energize progressive Democrats may have the hardest time getting through the winnowing process.
That could be the case with the proposal to offer a new public option health insurance plan alongside subsidized private coverage through HealthCare.gov. It’s not clear whether such a proposal would pass muster under the budget rules that would allow Democrats’ agenda to clear the Senate without Republican votes or the threat of a filibuster.
Separately, a proposal to lower Medicare’s eligibility age from 65 to 60 could prove tricky. Republicans are already pointing out that Medicare’s giant trust fund is expected to be in the red in 2026. They say that letting more people into the program would only weaken it further. Democrats may not want to be pulled into a debate over Medicare’s solvency.
“Healthcare has been a Democratic issue from the get-go,” said health economist Gail Wilensky, a former Medicare administrator who advises Republicans. “At the moment their focus is still going to be on expansion. How they pay for that is not clear.”
