July 15, 2019

Biden just released his health reform plan. Here's what's inside.

Daily Briefing

    Former Vice President Joe Biden, who is seeking the 2020 Democratic nomination for president, on Monday unveiled a health reform plan that aims to build on and protect the Affordable Care Act (ACA) by providing Americans with the option to enroll in a public health plan and expanding eligibility for subsidies to purchase exchange plans.

    Where the other 2020 Democratic hopefuls stand on health care

    Details on Biden's health plan

    According to Axios' "Vitals," Biden's plan is "rooted firmly in the" ACA and would not shift the United States toward a so-called "Medicare-for-All" system—a proposal backed by several other candidates seeking the 2020 Democratic nomination for president. Biden in a video posted Monday said, "I understand the appeal of Medicare for All. But folks supporting it should be clear that it means getting rid of Obamacare. And I'm not for that."

    A spokesperson for Biden's campaign said Biden's plan highlights the need for immediate action to improve the U.S. health system, according to Politico. The spokesperson said, "We can't afford the years it will take in order to write and maybe pass Medicare for All. A stop in progress is unacceptable. That's why the Biden Plan builds on Obamacare and works toward achieving universal coverage as soon as possible."

    Biden's plan calls for creating a new, so-called "public option" health insurance plan that would compete with private health plans on the market, "Vitals" reports. The public plan would be available to all Americans, including individuals whose employers offer health coverage.

    Biden's plan would automatically enroll individuals with incomes below 138% of the federal poverty level (FPL) in the public health plan during their interactions with public schools or other federal programs for individuals with low incomes. As a result, Americans who live in the 14 states where officials have not expanded Medicaid would have automatic access to the public health plan, The Hill reports. The public option health plan would not affect Medicaid expansions in states that already have expanded the program under the ACA, which means states that have not yet expanded could get the better deal, as states that have expanded their programs would have to continue footing the bill for their expanded programs, according to "Vitals."

    Biden's proposal also would make more Americans eligible for the ACA's subsidies to help offset the cost of purchasing an exchange plan. Currently, the subsidies are available to families with incomes between 100% and 400% FPL. However, Biden's proposal would eliminate the 400% income cap on eligibility for the subsidies.

    According to "Vitals," Biden's plan also would increase the subsidy amounts qualifying individuals could receive.

    In addition, Biden's proposal seeks to reduce the costs of prescription drugs by repealing current federal law that prohibits Medicare from negotiating lower drug prices with drug manufacturers. His plan also would:

    • Allow Americans to purchase prescription drugs from other countries;
    • Eliminate tax breaks given to pharmaceutical corporations for advertising spending;
    • Establish an independent review board to link the prices of new specialty drugs to the average price in foreign countries;
    • Restrict launch prices for prescription drugs with no competition on the market; and
    • Restrict price increases over the general inflation rate.

    Biden's proposal also notes that he plans to:

    • Address so-called "surprise" medical bills;
    • Expand access to abortion care and contraceptives; and
    • Increase investments in community health centers.

    Biden's plan would cost an estimated $750 billion over 10 years. According to Reuters, the plan calls for a combination of higher tax rates on high incomes and doubled tax rates on capital gains to cover the proposal's costs.

    A senior campaign official on Sunday said, "As president, Biden will roll back [President] Trump['s] tax cuts for the wealthy and return the top rate to 39.6%" from the current rate of 37%. Under Biden's proposal, individuals with annual incomes over $1 million would pay double the amount they pay in taxes now for long-term gains made in the stock market, according to Reuters.

    Reaction

    Larry Levitt, EVP of health policy for the Kaiser Family Foundation, said Biden's proposal seems more feasible than Sen. Bernie Sanders' (I-Vt.) "Medicare-for-All" proposal—which largely would eliminate private health insurance and, over a four-year period, would expand Medicare to cover all Americans, according to Politico. Levitt said, "Building on the ACA is the quickest way to get more people insured and improve affordability, while not taking on any powerful health industry group or disrupting coverage for those who already have it."

    However, Levitt said small and gradual improvements to the ACA would leave "an inefficient and costly health care system in place" (Baker, "Vitals," Axios, 7/15; Klar, The Hill, 7/15; Stone, Reuters, 7/15; Diamond, Politico, 7/15; Goodnough, New York Times, 7/15).

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