How House Democrats would expand Medicare and Medicaid and lower prescription drug costs

Starting in 2025, residents in states that have not expanded Medicaid would be able to join a federally managed Medicaid program. 

By: - September 18, 2021 6:30 am

By Laura Olson

WASHINGTON — New Medicare benefits for older Americans, like dental care.

An expansion of eligibility for Medicaid for low-income people in Republican-controlled states that have declined to take that step.

And potentially an historic effort to rein in prescription drug prices — if congressional Democrats can work through objections from moderates in their party.

The massive $3.5 trillion budget reconciliation package that House Democrats finished sketching out this week would make significant changes to how Americans obtain health care.

The proposals were drafted based on President Joe Biden’s “Build Back Better” policy plan. The House Democrats’ outline may be altered in the Senate, where some senators want to tweak those policies (including getting those upgraded Medicare benefits to seniors sooner).

Any plans also will need to pass procedural muster with the Senate’s parliamentarian, who could rule that certain sections of the bill can’t be enacted using the reconciliation process. That procedure allows bills to be passed with just a majority vote in the evenly divided Senate — meaning reconciliation could reach the president’s desk without any support from Republicans.

Here’s more on the health care provisions woven into that legislation, and how they would work:

Dental, hearing and vision coverage for seniors

One ambition of the proposal advancing in the House is to fill in holes in Medicare’s coverage. The federal health insurance program for seniors and people with disabilities currently doesn’t cover most dental, hearing or vision care — services that beneficiaries now must pay for out of pocket or through supplemental coverage.

The pending legislation would add those benefits, so that dentures, hearing aids, eye exams and glasses would be part of the traditional Medicare program.

However, the dental benefits would not go into effect until 2028, years after the hearing and vision coverage. Some Senate Democrats have opposed that lengthy timeline for incorporating dentists into the Medicare program, and have floated a voucher program to shorten the transition.

Not in House bill? Lowering Medicare eligibility age

One Medicare change sought unsuccessfully by some Democrats was to lower the age for Medicare enrollment, from the current 65 to 60.

That effort — backed by Sen. Bernie Sanders, a Vermont independent who caucuses with Democrats, as well as some centrist House Democrats — didn’t make it into the House legislation. It could be added in the Senate, but it’s likely to face tougher odds in that chamber.

More access to Medicaid

Another major shift would be the expansion of health insurance coverage to more low-income Americans. That would happen in part by broadening eligibility in 12 states that have declined to accept federal funding to extend their programs.

The 12 states that have refused to align with Medicaid eligibility requirements in the 2010 Affordable Care Act — which extended coverage to adults with incomes up to 138% of the poverty level —  include Wisconsin, Kansas, Tennessee, North Carolina, Georgia, and Florida, according to the Kaiser Family Foundation.

Starting in 2025, residents in states that have not expanded Medicaid would be able to join a federally managed Medicaid program.

Until that new fully federal option goes into effect, the proposal would expand the ACA’s premium tax credits to those whose incomes are below the poverty line, to make it easier for them to get health coverage through the insurance exchanges.

The proposal also would require states to begin Medicaid coverage for incarcerated individuals 30 days before they are released, so that people leaving prison have health coverage as they re-enter society.

And states also would be required to extend postpartum Medicaid and Children’s Health Insurance Program coverage for one year after the end of pregnancy, instead of just 60 days. The American Rescue Plan passed earlier this year gave states the option of making that change, while the reconciliation proposal would require it.

Dispute over drug price controls

A key challenge in extending these safety net programs is how to pay for the new costs, and part of the answer is intended to be in the savings from an overhaul to prescription drug pricing.

That proposal would allow the federal government to negotiate over the prices of hundreds of drugs, including insulin, and to penalize drugmakers that hike prices faster than inflation. Those changes, which are part of a separate bill, HR 3, have been projected to save $456 billion over a decade.

But the overhaul ran into opposition from a small group of moderate House Democrats who sought a narrower approach.

With three Democrats — Reps. Kurt Schrader, of Oregon; Scott Peters, of California; and Kathleen Rice, of New York — joining Republicans to vote against the drug pricing proposal in the Energy and Commerce Committee, the panel deadlocked.

The pricing plan did pass out of the Ways and Means Committee, which was crafting another portion of the reconciliation bill. But it also lost another Democratic vote there, with Rep. Stephanie Murphy, D-Fla., opposed.

“I strongly support numerous provisions in the House Ways and Means portion of the Build Back Better Act, especially the historic provisions to combat the existential threat of climate change,” she said in a statement. “But there are also spending and tax provisions that give me pause, and so I cannot vote for the bill at this early stage.

“As this process moves forward, I remain optimistic that the comprehensive reconciliation package will be appropriately targeted and fiscally responsible—paid for by tax provisions that promote fairness but do not hurt working families.”

The fight over reining in prescription drug prices is far from over. Trade groups representing pharmaceutical companies have been lobbying and advertising against the proposal for weeks. Some Senate Democrats also have been skeptical of the drug pricing plan.

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Laura Olson
Laura Olson

Laura Olson covers the nation's capital as a senior reporter for States Newsroom, a network of nonprofit outlets that includes Pennsylvania Capital-Star. Her areas of coverage include politics and policy, lobbying, elections, and campaign finance.