Employee Benefits Compliance

The Biden Approach to Healthcare

Before the electoral votes are fully determined, employers and consumers of healthcare are already highly interested in what the President-elect Biden plans to do to address healthcare in this country.

 

This article provides a high-level introduction to the policies and priorities of the incoming President. While much is riding on the ability for Biden to succeed in making theories, policies and intentions actual law, it nevertheless provides the starting point for the next debate on healthcare in the United States. See below for highlights of the BidenCare plan.

The Affordable Care Act

President-elect Biden supports the Affordable Care Act and plans to build on it by creating additional choices without eliminating private insurance.  He also intends to make the current health care system less complex to navigate.

Under Biden’s plan, the cornerstone of the Affordable Care Act will remain intact if the Biden proposals are adopted, including coverage mandates for employers and individuals, as well as the availability of Exchange coverage and premium subsidies.  His recommendations build upon the ACA and include the following key policy proposals for building upon ObamaCare.

Woman shaking hands with doctor

Exchange Coverage & Premium Subsidies

As President, Biden will focus on middle class families by eliminating the 400% income cap on tax credit eligibility and lowering the limit on the cost of coverage from 9.86% of income to 8.5%. His goal is that no family buying insurance on the individual marketplace, regardless of income, will have to spend more than 8.5% of their income on health insurance.

Additionally, Biden will propose  increasing the size of tax credits by calculating them based on the cost of a more generous gold plan, rather than a silver plan. Specifically, he proposes to:

  • Increase premium subsidies and cost-sharing assistance
  • Reduce percentage threshold used to determine income eligibility
  • Allow those with eligible employer coverage to choose Exchange coverage instead

Medicaid & Medicare Reform

Biden’s plan is designed to help additional uninsured individuals get Medicaid-type coverage by offering premium-free access to a public health care option for approximately 4.9 million individuals who would otherwise be covered by Medicaid in most states.

He is recommending:

  • Expanding Medicaid income thresholds, with full federal funding for the first three years
  • Offering a public premium-free health plan with benefits similar to Medicaid, for individuals with more than 400% of the Federal Poverty Level
  • Lowering Medicare eligibility from age 65 to 60
  • Capping out-of-pocket spending for Medicare Part D prescription drug coverage

Pharmacy Price Regulation

President-elect Biden intends to target pharmacy pricing and spending or order to reduce costs for consumers, including Medicare beneficiaries.

The following are specific plans to reduce pharmacy costs:

  • Repeal the existing law explicitly barring Medicare from negotiating lower prices with drug corporations
  • Establish independent government review board run by HHS that uses international prices as benchmark in price-setting recommendations for newly introduced drugs
  • Cap out out-of-pocket spending in Medicare Part D prescription drug coverage
  • Allow consumers to import prescriptions from other countries, with safeguards in place

Associate Health Plans / Short-term Plans

Biden will again address association health plans, as was the case with prior administrations. His health care plan includes the following adjustments to association health plans:

  • Return to pre-Trump Administration oversight, restricting availability to such plans
  • Changes will include reducing which types of employer entities could form an association

A Journey Just Beginning

The Biden policy proposals outline the Biden plan for healthcare and builds on the Affordable Care Act implemented during the Obama administration. His success in making these modifications will depend largely on the outcome of several key Senate races, and the corresponding balance of power.  Depending on potential republican control of the Senate, the makeup of Congress, and the Biden’s ability build consensus will these plans become law. Much will change during future debates and the legislative process.

Be sure to partner with the Leavitt Group as we continue to analyze the law as it happens. Subscribe to the Leavitt Group news site at news.leavitt.com.

The information herein is educational only and not intended as legal advice.

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