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senate Bill S. 981

Should Medicare Be Expanded to Establish a Public Option for Individual & Small Business Health Insurance?

Argument in favor

Using the existing Medicare framework to create a public option for health insurance coverage will help create more competition in the health insurance marketplace and give people in rural and undercovered areas another option for medical coverage.

jimK's Opinion
···
08/15/2019
I think that building a healthcare system based upon the current ACA and Medicare programs is the right way to began transitioning to a more universal and affordable system. Exchange based selectable optional additions for those individuals or employers willing to pay for them are an effective way to began reeling in medical costs. It makes offerors compete on a well regulated playing field and clearly documents what is offered and how much it would cost along with how well the optional insurance programs perform. Let the market and the users help guide and structure the program. Oh my- use the principals of real capitalism instead of lobbied for crony-capitalism to actually guide the process. All that being said- I am concerned about legislative actions that seem to attack parts of the issue without some broader long-term strategy in place. We need a clear commitment to a longer term goal and a way to evaluate individual legislative efforts in light of what we hope to achieve. I would like an integrated package that affordably addresses most of the needs of most of us- and not a bunch of uncoordinated efforts simply stapled together.
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JoshCauto's Opinion
···
08/15/2019
Establishing a public option for both individuals and small business owners will give people in rural areas more choices. Along with this, expanding Medicare will help out the rural hospitals. It will shorten travel and wait times and overall help business owners who previously had been disproportionately affected and left uninsured. Healthcare is a fundamental right, not just for the privileged. We must continue the good but long work ahead of us to make this goal a flourishing reality.
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Rebekah 's Opinion
···
08/15/2019
We need Medicare For All. NOW. 75% of the public want it but Congress refuses to comply because they take millions from Big Pharma and Insurance lobbies.
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Argument opposed

This plan would be tremendously costly to hospitals and healthcare providers, which makes it a nonstarter. It could also be a step along the road to single-payer healthcare that would eliminate employer-sponsored plans, which many Americans are happily on now.

Gopin2020's Opinion
···
08/15/2019
No Medicare is being bankrupted by freeloaders, illegals. We must preserve it for those who have paid into it. #MAGA
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Carmine's Opinion
···
08/15/2019
No Medicare should be clawed back! Enough of this meaningless spending! Obama care was suppose to make insurance cheaper meanwhile it did the exact opposite! It made insurance extremely expensive & unaffordable for the average hard working Americans! Stop sucking the money from hard working Americans to pay for your poorly managed social programs! This is a Country built on Capitalism & it will always be Capitalist! No to socialism, no to ruining our economy, no to meaningless spending, & no to expanding Medicare at the cost of hard working middle America!
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JTJ's Opinion
···
08/15/2019
No, Medicare was sold to be a safety net for the poor and elderly. In reality it was one more step by socialists towards government control, now they want to expand it further. They will not stop until we are all completely dependent on government.
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bill Progress


  • Not enacted
    The President has not signed this bill
  • The house has not voted
  • The senate has not voted
      senate Committees
      Committee on Finance
    IntroducedApril 2nd, 2019

What is Senate Bill S. 981?

This bill — the Medicare-X Choice Act of 2019 — would build on the Medicare framework to establish a public option on the individual and small business health insurance exchanges.  The Medicare-X plan would cover essential health benefits, including pediatrics and maternity care, to align with other plans on the exchanges established by the Affordable Care Act (aka Obamacare). It would also make Advance Premium Tax Credits and Cost-Sharing Reduction (CSR) payments available to enrollees.

Medicare-X would be phased in as follows: 

  • Beginning in 2021, this bill would make Medicare-X available in areas with one or fewer options on the ACA Exchange. The Medicare-X plan would also be available in rating areas with a provider shortage or lack of plan competition, such as Health Professional Shortage Areas (HSPAs) and rural areas. 
  • By 2024, the plan would be available in all rating areas. 
  • Finally, in 2025, it would be available on the Small Business Health Options Program Exchange. 

The Health and Human Services (HHS) Secretary would have the authority to contract with outside entities to process claims or administer additional components of the plan. This would include contracting with entities that currently administer certain functions for Medicare. This bill would also direct the HHS Secretary to gather data from State Insurance Commissioners to set adequate premiums. 

Some key specifics of this bill are outlined below.


SUBSIDIES FOR PREMIUMS

This bill would eliminate the subsidy cliff by extending premium tax credit eligibility to those at and above 400% Federal Poverty Line (FPL). Individuals at 400% FPL would pay 9% of their income toward the “benchmark plan,” increasing to 13% of their income at 600% FPL and above.

For those below 400% FPL, this bill would reduce the percentage of income they’re expected to contribute to the benchmark plan by 0.5%.


REINSURANCE

This bill would authorize three years of funding for a national reinsurance program at $10 billion per year. 


PROVIDER NETWORK REIMBURSEMENT RATES

This bill would require that providers participating in Medicare and/or Medicaid also accept Medicare-X patients. It would direct the HHS Secretary to enroll additional providers, such as pediatricians and OB/GYNs, to provide their specialized services. Providers would be reimbursed at Medicare rates, with flexibility for the HHS Secretary to reimburse up to 125% of Medicare rates for hospitals and physicians in rural areas. 


PRESCRIPTION DRUGS

This bill would authorize the HHS Secretary to negotiate drug prices under Medicare Part D and allow the public plan to participate in those arrangements. The HHS Secretary would be encouraged to use value-based payment arrangements for prescription drugs. 


DELIVERY SYSTEM REFORM FOR AN ENHANCED HEALTH PLAN

The bill would direct the HHS Secretary to use outcomes-based alternative payment models that are aimed at care coordination for patients with chronic conditions. It would also encourage providers to use innovative technology, such as telehealth and remote patient monitoring, and integrate social services like food, housing, and transportation. 

This bill would also authorize the HHS Secretary to establish a grant program to fund broader experimentation with accountable communities for health in order to integrate social needs in health care delivery services. 


FUNDING

This bill would set premiums to cover the plan’s full actuarial cost, including administrative costs. 


TRADITIONAL MEDICARE

This bill wouldn’t have any effect on benefits offered through Medicare Fee-for-Service (FFS), Medicare Advantage or the Medicare trust fund.

Impact

Americans seeking health insurance; Americans seeking a public health care option; Medicare; Part D drug pricing; hospitals; health providers; Medicare and/or Medicaid providers; and the HHS Secretary.

Cost of Senate Bill S. 981

A CBO cost estimate is unavailable.

More Information

In-DepthSen. Michael Bennet (D-CO) reintroduced this bill from the 115th Congress to create Medicare-X, a public plan that would offer families, individuals, and small businesses additional, low-cost health insurance choices and create more competition in the marketplace:

“It is a disgrace that people’s lives are upended daily in our country because they have no health insurance. We need to cover everyone, reduce costs, and improve quality—and Medicare-X is the best way to accomplish those objectives. Medicare-X starts in rural areas because the market there is failing too many Americans. And by using the existing Medicare framework, it provides a new, affordable option without adding bureaucracy. There is no excuse for us not to finish what the ACA started and close the coverage gap in America through Medicare-X.”

In an April 2019 conference call with reporters, Sen. Bennet argued that this is a practical way to achieve universal coverage

“I just think this is a much more practical way to try to achieve the objective – which is universal coverage and a primary reduction of our expenditures on health care – than, frankly, any other proposal that’s been made since the Affordable Care Act was passed.”

Sen. Bennet argues that this plan is superior to single-payer plans that’d eliminate employer plans: 

“180 million people in America get their insurance through an employer-based plan and Medicare X gives people the opportunity to decide whether they want to stay on that plan. Some of the other plans take away insurance from those 180 million.”

Original cosponsor Tim Kaine (D-VA) adds:

“Our goal is more health care options and lower costs. With those priorities top of mind, we introduced Medicare-X to give Americans more quality, affordable health care choices, especially in rural communities that face a shortage of insurance options. This bill takes additional steps to reduce premiums, increase coverage, and make health insurance more affordable. I want to make sure that Virginians – and all Americans – can get the care they need.”

Sen. Kaine argues that Medicare X would be much cheaper than for-profit insurance, as “CMS needn’t collect a profit, they don’t have to return to shareholders. The cost of this nonprofit insurance policy would be dramatically less than for-profit insurance.”

U.S. PIRG supports this bill. Its High Value Healthcare Campaign Director, Lance Kilpatrick, says

“Too often, Americans have too few choices for health insurance. With such limited options, Americans pay too much for too little in health benefits. And in many rural areas, they must choose between one insurance option or no insurance at all. On the other hand, millions of Americans love Medicare for delivering quality care at a reasonable price. The Medicare X Choice Act would provide the rest of the country with the chance to choose insurance similar to Medicare that delivers excellent medical treatment at a fair cost. By providing competition to private insurance plans, the bill will encourage other health care providers to innovate by cutting wasteful spending on useless procedures and tests, reducing administrative overhead and delivering higher-value services. This bill would also help the millions on Medicare, because it would allow Medicare to negotiate prescription drug prices, which reduces costs for everyone. Polls continually show that Americans across all demographics want the choice to stay with their existing plan or opt into a Medicare-based plan, if that’s better for their family. Medicare X would give them that possibility. We applaud Senators Bennet and Kaine for offering this practical solution for people who struggle with astronomical health care costs and for driving forward a value-based care system.”

The Guttmacher Institute notes both strengths and weaknesses of this bill in its analysis. It says this bill’s strengths are: 

  • Creation of new insurance options to encourage competition, expansion of ACA premium subsidies and funding of a nationwide reimbursement program, all of which could lower insurance costs and expand coverage; 
  • Application of current ACA protections, including subsidies and antidiscrimination rules, to the new public option; 
  • Coverage requirements for contraception, maternity care and other services; and
  • Provision of new investments in delivery system and payment reform, including efforts to reduce health disparities, expand the use of telehealth and integrate health care with programs addressing social determinants of health.

However, the Guttmacher Institute also notes a few weaknesses of this bill: 

  • Lack of a provision specifically designed to address sexual and reproductive health;
  • That existing federal and state abortation coverage restrictions would apply to the Medicaid-X plan, which would mean abortion coverage would be banned in at least half of states; and
  • Maintenance of the ACA’s existing restrictions excluding undocumented immigrants and DACA recipients from buying coverage, with or without government subisides.

The Colorado Sun notes that the reimbursement rate this bill proposes could be an issue for medical providers

“Medicare generally pays better than Medicaid across the country. But it still pays well below what doctors and other providers can get from private insurance companies. The bill would, though, allow for payments 25 percent above normal Medicare rates to doctors and hospitals in rural areas.”

The conservative group Colorado Rising Action opposes this bill. Its spokesperson, Lindsey Singer, says

“A public option brings the government even more intimately involved in our health care decisions, and threatens to run out the few existing private insurance options from under-served areas.”

America’s Health Insurance Plans (AHIP), which views this as a path to single-payer healthcare, opposes this bill. It says, “Medicare X is a slippery slope to government-run healthcare. The American people want healthcare that works for them – not a one-size-fits-all health care system.” The National Association of Health Underwriters (NAHU), which “strongly opposes all forms of single-payer healthcare and is committed to promoting employer-sponsored health coverage and preserv[ing] Medicare, Medicaid, and other existing health programs,” also opposes this proposal. 

In an April 2019 tweet, President Trump said that congressional Republicans were working on “a really great HealthCare Plan” to be voted on after the 2020 elections, “when Republicans hold the Senate & win back the House.” However, he has yet to offer specifics about the plan.

Senate Majority Leader Mitch McConnell (R-KY) has dubbed Medicare for All “the Democrats’ Medicare for None” proposal. In an interview with POLITICO, he signaled his plan to attack this Democratic proposal and indicated that he isn’t interested in leading Trump’s effort to make the GOP the “party of healthcare.” 

This legislation has 11 Democratic Senate cosponsors. Its House companion, sponsored by Rep. Antonio Delgado (D-NY), has 18 Democratic House cosponsors. As of August 8, 2019, neither bill had received a committee vote. Given Trump’s and McConnell’s positions, this bill is unlikely to pass in the Republican-controlled Senate.

Last Congress, this bill had 10 Democratic Senate cosponsors and didn’t receive a committee vote. Its House companion, sponsored by Rep. Brian Higgins (D-NY) with nine Democratic House cosponsors, also didn’t receive a committee vote.

This bill is one of several pieces of legislation in the 116th Congress seeking to expand public insurance options. Other proposals include: 

  • Medicare for All Act of 2019 (S. 1129), sponsored by Sen. Bernie Sanders (I-VT), which would collapse Medicare, Medicaid, and private insurance into a universal health care system; 
  • Medicare at 50 Act (S. 470), sponsored by Sen. Debbie Stabenow (D-Mich.), which would allow non-Medicaid individuals ages 50-64 to buy in to Medicare; and
  • State Public Option Act (S. 489/H.R. 1277), sponsored by Sen. Brian Schatz (D-HI), which would allow individuals to buy in to Medicaid through the ACA marketplaces.


Of NoteWhen this bill was introduced in the 115th Congress, Vox’s Sarah Kliff explained how it fits into the existing healthcare system, versus how single-payer proposals would radically change the healthcare system: 

“Medicare X and single-payer represent distinctly different views of the future of American health care and what role the federal government ought to play. Medicare X fits neatly into the system that exists right now. It slots into the Affordable Care Act’s marketplaces and Medicare’s doctor network. Single-payer, by contrast, is a much more radical change—one where a government health plan is not a choice but the only option available. It abolishes the Obamacare marketplaces as well as employer-sponsored coverage.”

In a study for the American Hospital Association and Federation of American Hospitals, KNG Health Consulting found that this proposal could reduce payments to hospitals by $800 billion over 10 years and significantly disrupt the existing health insurance exchanges. KNG Health Consulting also found that this proposal would result in only a modest increase in insured consumers.

A Medicare public option was included in several drafts of the ACA. However, it was ultimately stripped from the final legislation due to political opposition from moderates such as then-Sen. Joe Lieberman (I-CT). Now, it’s a relatively popular proposal among Democrats, and several versions of a Medicare buy-in have been introduced in recent Congresses


Media:

Summary by Lorelei Yang

(Photo Credit: iStockphoto.com / Bill Oxford)

AKA

Medicare-X Choice Act of 2019

Official Title

A bill to establish a public health plan.

    I think that building a healthcare system based upon the current ACA and Medicare programs is the right way to began transitioning to a more universal and affordable system. Exchange based selectable optional additions for those individuals or employers willing to pay for them are an effective way to began reeling in medical costs. It makes offerors compete on a well regulated playing field and clearly documents what is offered and how much it would cost along with how well the optional insurance programs perform. Let the market and the users help guide and structure the program. Oh my- use the principals of real capitalism instead of lobbied for crony-capitalism to actually guide the process. All that being said- I am concerned about legislative actions that seem to attack parts of the issue without some broader long-term strategy in place. We need a clear commitment to a longer term goal and a way to evaluate individual legislative efforts in light of what we hope to achieve. I would like an integrated package that affordably addresses most of the needs of most of us- and not a bunch of uncoordinated efforts simply stapled together.
    Like (98)
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    No Medicare is being bankrupted by freeloaders, illegals. We must preserve it for those who have paid into it. #MAGA
    Like (23)
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    Establishing a public option for both individuals and small business owners will give people in rural areas more choices. Along with this, expanding Medicare will help out the rural hospitals. It will shorten travel and wait times and overall help business owners who previously had been disproportionately affected and left uninsured. Healthcare is a fundamental right, not just for the privileged. We must continue the good but long work ahead of us to make this goal a flourishing reality.
    Like (40)
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    We need Medicare For All. NOW. 75% of the public want it but Congress refuses to comply because they take millions from Big Pharma and Insurance lobbies.
    Like (38)
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    Medicare takes $136/mo out of my Social Security check plus I paid into it all my working life. It pays 80% of out patient after a small deductible and 100% of hospital after a manageable deductible. So it's not "free". This is the basic plan. Most people have one of about 10 private supplemental insurance plans to pay toward the deductible and 20% outpatient. Medicare limits payments to PRIVATE providers. The administrative costs for Medicare is 2-3% vs private insurance of 16-19%. Medicare doesn’t run expensive marketing commercials or have private investors so it should be more than competitive if expanded. There are about 3 plans being considered so something hopefully will emerge to address the expense and underinsured crisis we have experienced for decades. Let’s have a public discussion about the options. Do not let Republicans control the dialogue or take us back to pre ACA. They have no plan.
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    Medicare for all! Universal single payer healthcare system now!!
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    Yes, as a step toward UNIVERSAL SINGLE PAYER HEALTHCARE, CRADLE TO GRAVE!
    Like (25)
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    If it will save our rural hospitals please pass this.
    Like (22)
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    No Medicare should be clawed back! Enough of this meaningless spending! Obama care was suppose to make insurance cheaper meanwhile it did the exact opposite! It made insurance extremely expensive & unaffordable for the average hard working Americans! Stop sucking the money from hard working Americans to pay for your poorly managed social programs! This is a Country built on Capitalism & it will always be Capitalist! No to socialism, no to ruining our economy, no to meaningless spending, & no to expanding Medicare at the cost of hard working middle America!
    Like (21)
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    Absolutely! Ever since the damn ACA was passed we SHOULD have been working to modify it to better meet the needs of the American people. The time, energy and money spent by the Republicans to use it as a political tool instead of working to make it functional for ALL of the American people was a travesty and a dereliction of duty! We would not even be realistically discussing Medicare-for-All in this current campaign if real and effective action to change the ACÁ had been accomplished! This is America, remember? We do not like to do things rapidly or radically unless forced to do so by circumstances. Gradual changes make it possible to tweak government programs to meet the needs and demands of the American people without threatening instability or damaging public trust. Our legislators of BOTH parties have succeeded in doing just the opposite, mostly for personal gain! And the Congressional approval rating of 9% is a clear indicator!
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    Medicare framework should establish a public option, this is good for all Americans, but will be a slow process over many years to implement. Will not happen over night. Granted Medicare and healthcare needs to be improved, not dismantle by the Republican Party, with nothing to replace it with. Also there is no free lunch, unless you are wealthy or a corporation!
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    Yes, it's one step closer to universal health care. Make it easy for businesses of all sizes to join and lower costing than current insurance rates and they'll transition over that much faster.
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    ABSOLUTELY!!!
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    Yea we should. Medicare for all.
    Like (15)
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    Yes. A buy-in option to Medicare would be an appropriate immediate action that should be taken to strengthen ACA and the nation’s health insurance coverage and health care options.
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    No, Medicare was sold to be a safety net for the poor and elderly. In reality it was one more step by socialists towards government control, now they want to expand it further. They will not stop until we are all completely dependent on government.
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    YES, there should be a PUBLIC OPTION to MEDICARE!! We need to make sure ALL people in this COUNTRY HAVE HEALTHCARE!!
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    Please support S 981 Using Medicare framework to create a public option for health insurance coverage. Thanks to Michael Bennet ! This is life saving !
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    👎🏻👎🏻 Senate Bill S-981 Aka the Medicare-X Choice Act of 2019 👎🏻👎🏻 I’m opposed to this Senate Bill S-981 Aka the Medicare-X Choice Act of 2019 which would build on the Medicare framework to establish a public option on the individual and small business health insurance exchanges.  The Medicare-X plan would cover essential health benefits, including pediatrics and maternity care, to align with other plans on the exchanges established by the Affordable Care Act (aka Obamacare). It would also make Advance Premium Tax Credits and Cost-Sharing Reduction (CSR) payments available to enrollees. This plan would be tremendously costly to hospitals and healthcare providers, which makes it a nonstarter. It could also be a step along the road to single-payer healthcare that would eliminate employer-sponsored plans, which many Americans are happily on now. SneakyPete.......... 👎🏻👎🏻👎🏻👎🏻👎🏻. 8.16.19..........
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    Public option, please.
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