The administration can act on its own to further President Joe Biden’s campaign promise to get more Americans affordable health coverage and shrink the number of uninsured, even though Congress is mulling broader measures.
Tweaks to regulations under the Affordable Care Act and other health laws can be implemented while lawmakers debate major proposals to expand coverage, such as forcing several states to expand for Medicaid, the low-income health program. The administrative changes can make a big difference in the number of people who have insurance in the long term and aren’t likely to meet as much resistance as some of the measures on Capitol Hill.
About 57% of uninsured people in the U.S.—roughly 29 million—are eligible for free or subsidized health insurance, according to the Kaiser Family Foundation. Medicaid is free for the poorest U.S. residents, and those with slightly higher incomes are eligible for substantial subsidies to buy Obamacare health plans. Some people pay as little as $10 a month.
Among the regulatory changes at the disposal of the Centers for Medicare & Medicaid Services is a requirement that states use information they already have to verify their low-income residents remain eligible for Medicaid. About 25% of Medicaid beneficiaries lose their coverage within a year, known as churn, according to a 2016 study.
The CMS could also require states to determine if people shopping for Obamacare plans are eligible for Medicaid. They could get free coverage rather than paying for it.
“A really promising pathway” for the administration to grow U.S. coverage involves state experimentation with health policy, said Kristin Wikelius, managing director of policy and external affairs for the advocacy group United States of Care. The CMS can encourage states to try new offerings for Medicaid and Obamacare participants, and they could make even more progress if the agency waived a requirement that the Obamacare pilot programs are cost-neutral.
Lawmakers are considering ambitious (and in some cases, controversial) proposals to allow people to more easily get insurance, including forced Medicaid expansion, broadening the Medicare age, and extending or making permanent Obamacare premium subsidies. Health and Human Services Secretary Xavier Becerra hasn’t stated which approaches the administration would prefer, saying it will support whatever Congress can pass.
The Supreme Court gave a boost to the administration’s regulatory plans when it rejected a constitutional challenge to the ACA for the third time. If the Supreme Court had done anything other than uphold the law, the administration’s entire agenda would have needed to be “How do you fix it?” said Bob Kocher, former special assistant to President Barack Obama for health care and economic policy.
Now officials can focus entirely on how to use the law to bring more uninsured people onto coverage rolls.
Identifying Eligible People
Some of the changes are as simple as making it easier for uninsured people to find the benefits to which they’re already entitled.
The Obama administration’s original ACA regulations gave states the option to identify people eligible for Medicaid on Obamacare websites. Eliot Fishman, senior director of health policy at Families USA, a consumer health-advocacy organization, said the Biden administration could make that option a requirement, ensuring anyone with a sufficiently low income shopping for an ACA plan gets free Medicaid coverage instead.
Becerra, a Latino who played a major role in pushing for immigration reform, could also play a large role in reassuring immigrant and mixed-immigration status families that rejoining Medicaid or going back onto Obamacare plans won’t affect their immigration status, Fishman said. Some people in those groups dropped off coverage during the Trump administration because of a proposal, dismissed in March by the Supreme Court, that could’ve penalized them for using resources like Medicaid.
Reverifying Medicaid Eligibility
States could also be required to proactively verify Medicaid enrollees each year, cutting down on paperwork the beneficiaries have to file on their own.
Medicaid is the only type of insurance in the U.S. that requires people to go through an annual check to determine if they are still eligible for the program, a process that can be difficult and lead to some losing coverage.
Eligibility redeterminations stopped during the Covid-19 public health emergency. When that eventually ends, about 80 million people will be required to prove that they’re still eligible or lose coverage, Fishman said.
The ACA already requires states to use all existing data to fill out eligibility redetermination paperwork, but the Obama administration was lenient in enforcing it because state governments were having trouble implementing Obamacare when it was a new law, said Fishman, who worked on Medicaid waivers at the CMS during the Obama administration.
The Trump administration encouraged periodic eligibility checks of Medicaid beneficiaries, and researchers suggested that may have contributed to a decline in enrollment.
The CMS can also create incentives for states to experiment with how they provide health insurance.
The ACA allows states to apply for waivers to try different coverage methods while still retaining the basic protections of the law. States can apply for two types—Section 1115 waivers that allow them to make changes to their Medicaid programs and Section 1332 waivers that allow changes to how states run their Obamacare plans.
Trump administration CMS chief Seema Verma told states through guidance the types of waivers she was interested in approving, such as those to require adult Medicaid beneficiaries to prove they were working or looking for a job to receive benefits.
Current CMS head Chiquita Brooks-LaSure is unlikely to have similar ideological views on work-for-benefits, but health policy consultants expect she will use similar guidance to convey the types of waivers she wants to see.
Colorado and Nevada are moving toward waivers to allow them to offer a state-provided alternative to private insurance, known as a public option, that can be more affordable than other plans. Washington state has already received clearance for its public option plan.
Brooks-LaSure could push state innovation through a regulation or guidance saying that any waivers designed to expand Medicaid eligibility or boost Obamacare subsidies are exempt from budget neutrality requirements, said Fishman, who was a member of the Biden-Harris transition HHS agency review team. The state wouldn’t have to cut costs elsewhere to cover more people.
Current rules state that 1332 waiver proposals can’t increase the federal budget, a policy that Medicaid waivers don’t have to meet. This was part of the reason no 1332 waivers were approved under the Obama administration, he said.
Much of the work to expand coverage will be led by Brooks-LaSure, who is no stranger to the ACA. She worked to get it passed as a staff member for the House Ways and Means Committee and worked at the HHS during the Obama administration to implement it.
Brooks-LaSure is cautious and diligent when it comes to procedure, said former colleague Ruth Tabak, a director for health-care at consulting firm Berkeley Research Group LLC. She won’t allow regulations to go out that are half-baked or that will end up tied up in lawsuits.
That means, however, that rulemaking could take more time than it did in previous administrations.
—With assistance from