About the Author: Vicky Cheng is a first-year law student at American University- Washington College of Law. Vicky graduated from McGill University and hopes to work in the corporate accountability space, where environmental law and human rights intersect with international corporate transactions, after graduating law school.
Practically overnight, COVID-19 ripped through the United States and brought the world to a standstill. Jobs were lost, businesses were closed, families were broken, and the number of deaths grew exponentially with every passing day. Although many Americans say they are satisfied with their health care, whether they are covered by private insurance or Medicare, the pandemic has torn back the curtain on America’s healthcare system.[1]
Today, the Affordable Care Act (“ACA”), or Obamacare, governs the healthcare system. Passed in 2010, the ACA notably created individual insurance market exchanges and expanded Medicaid to cover more low-income Americans.[2] The expansion covered an additional 12.7 million people; allowed children to stay on their parents’ insurance policies until the age of twenty-six; forced insurers to provide comprehensive benefits that included prescription drugs, maternity, and mental health; and barred insurers from denying coverage or charging higher rates to consumers based on them having pre-existing conditions.[3] However, more than twenty-six million Americans are still without any coverage and must delay seeking care, skip medications, or risk their lives because they cannot pay the bills.[4] The United States is the only wealthy developed nation that does not guarantee health care to all, meaning about one-in-ten Americans are uninsured.[5] Even with world-class resources and medical technology, it ranks the lowest among developed nations in avoiding preventable deaths.[6] Therefore, in the 2020 Democratic race, health care was the key fault line, and the only thing that all the candidates agreed on was that the existing plan was not working for America.[7]
With President Joe Biden now in office and the Democratic party controlling both the House and Senate, it is clear that the future healthcare system will include a “Medicare-like” public option.[8] Essentially, this option is a government-backed insurance plan that will make coverage more affordable because the government can negotiate lower rates with hospitals and physicians to decrease costs for consumers.[9] Theoretically, giving Americans a third option can control the cost and quality of health care and eventually achieve universal coverage because private insurers will be forced to compete by improving their prices, service, and quality.[10] To be successful, however, the public option must not have any of Medicare’s financing gimmicks.[11] Expenses of the public option must be financed by current users, not the next generation, and the option’s accounting should include the cost of money that American taxpayers and debtholders have invested to build Medicare’s infrastructure.[12]
Fair and equitable health care is key to the physical, fiscal, and political wellbeing of a nation.[13] To attract more people into coverage and enhance the country’s ability to respond to pandemics, like COVID-19, Biden’s public option cannot be watered down and it must be ready to tackle disruptions in the hospital and physician markets.[14] According to President Biden’s campaign platform, the four key pillars of his healthcare plan are (1) fortifying the ACA with a public option, (2) expanding the ACA for lower-income Americans in non-Medicaid expansion states, (3) introducing legislation on Medicare for More to lower the age of eligibility, and (4) revitalizing public health.[15] Specifically, the public option will repeal existing laws that ban Medicare from negotiating lower prices with drug manufacturers, limit price increases for brand and abusively priced generic drugs, allow consumers to purchase cheaper priced drugs from other countries, and enable undocumented immigrants to buy into the option.[16] The intentions are good on paper, but 2020, if anything, has demonstrated that inequality is far-reaching and systemic, and that gaps in access will always remain unless they are actively addressed.[17]
Policy debates about a public option is not a recent phenomenon and neither is the tug-of-war between a strong national government and states’ rights.[18] First, President Truman proposed a comprehensive national health insurance that was rejected; President Johnson created a compromise plan by accepting Medicare and Medicaid; and throughout the 1980s and ‘90s, reformers shifted focus from a comprehensive government-provided insurance to bringing market solutions into health care.[19] Second, every major legislative plan has drawn a line in the sand between the national and state government, such as Reconstruction, the New Deal, and the Social Security Act.[20] Moreover, whenever the application of policies were left to state governments, the results were often inequitable.[21] To truly address the centuries-long health disparities among Americans, the legislative and policy-making process must be scrutinized and leaders at all levels of government must be held accountable for implementation.[22] The public option must proactively address the gaps not filled yet by the ACA.[23]
The House passed the American Rescue Plan on February 27th.[24] Under the Plan, no family would have to pay more than 8.5 percent of their household income for insurance and subsidies available to low-income families would be increased.[25] However, these changes are not applicable to a dozen states where the ACA’s Medicaid expansion was not adopted following the Supreme Court’s landmark decision in 2012 that made expansion optional for states.[26] Additionally, healthcare reform at such a scale, not including the non-Medicaid states, is estimated to cost approximately $750 billion over the next ten years, which would be paid for by repealing tax cuts for the wealthy and raising the top income tax rate back to 39.6 percent.[27] Therefore, to positively transform the healthcare system and actually help the twenty-six million Americans who have been left behind by the ACA, President Biden’s public option needs to encourage the remaining states to expand their Medicaid coverage while those that have done so to maintain the expansion.[28]
[1] Tami Luhby, Health Care Explained: Medicare for All vs Public Options vs the ACA, CNN (July 30, 2019, 8:26 PM), https://www.cnn.com/2019/07/30/politics/health-care-explainer.
[2] Id.
[3] Id.
[4] Tanya Feke, Medicare for All vs Public Option: What Makes More Sense for America?, Very Well Health (June 25, 2020), https://www.verywellhealth.com/medicare-for-all-or-public-option-4781765.
[5] Luhby, supra note 1.
[6] Regina Herzlinger & Richard Boxer, The Case for the Public Option Over Medicare for All, Harv. Bus. Rev. (Oct. 10, 2019), https://hbr.org/2019/10/the-case-for-the-public-option-over-medicare-for-all.
[7] Luhby, supra note 1.
[8] Id.
[9] Id.
[10] Herzlinger & Boxer, supra note 6.
[11] Id.
[12] Id.
[13] Id.
[14] Brian Mastroianni, Why COVID-19 Proves We Need a Public Healthcare Option, Healthline (June 17, 2020), https://www.healthline.com/health/why-covid19-proves-we-need-a-public-healthcare-option.
[15] Joshua Cohen, Biden’s Healthcare Agenda in 2021: Shoring Up the Affordable Care Act, Forbes (Feb. 1, 2021, 9:17 AM), https://www.forbes.com/sites/joshuacohen/2021/02/01/bidens-healthcare-agenda-in-2021-shoring-up-the-affordable-care-act/?sh=2d41922639a4.
[16] Marianna Sotomayor, What’s in, and out, of Biden’s Health Care Plan, NBC Meet the Press Blog (July 15, 2019, 2:24 PM), https://www.nbcnews.com/politics/meet-the-press/blog/meet-press-blog-latest-news-analysis-data-driving-political-discussion-n988541/ncrd1030086#blogHeader.
[17] Mastroianni, supra note 14.
[18] Guian McKee, Joe Biden’s Health-care Plan is More Than a Half-Century in the Making, Wash. Post (Oct. 27, 2020, 6:00 AM), https://www.washingtonpost.com/outlook/2020/10/27/joe-bidens-health-care-plan-is-more-than-half-century-making/.
[19] Id.
[20] Michael Williams, Public Option in Biden Plan Could Change the Face of US Health Care, The Conversation (Feb. 11, 2021, 8:15 AM), https://theconversation.com/public-option-in-biden-plan-could-change-the-face-of-us-health-care-153816.
[21] Id.
[22] Id.
[23] Id.
[24] Rachel Siegel, What’s in the House’s $1.9 Trillion Coronavirus Plan, Wash. Post (Feb. 27, 2021, 8:01 AM), https://www.washingtonpost.com/us-policy/2021/02/26/american-rescue-plan-house-coronavirus-stimulus/.
[25] Sara Rosenbaum, The American Rescue Plan Does Not Provide Relief to Nation’s Poorest, Uninsured Americans, The Commonwealth Fund (Feb. 3, 2021), https://www.commonwealthfund.org/blog/2021/american-rescue-plan-does-not-provide-relief-nations-poorest-uninsured-americans.
[26] Id.
[27] Cohen, supra note 15.
[28] Rosenbaum, supra note 25.
