Going All In Medicare for All and other - American Medical Group Association
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IN WASHINGTON [ legislation + regulations + advocacy
]
Senator Bernie Sanders
(I-VT) has outlined a plan
to finance a Medicare-
for-All single payer
healthcare system as
part of his campaign for
the presidency.
Going All In Medicare for All and other
Medicare extender legislation
M
By Lauren N. edicare for All has been in the news between 50 and 64, as well as offer up Medi-
Lattany, M.P.S. frequently for the past several care as an “option” that people or employers
months. Bernie Sanders (I-VT), could buy into.
Kamala Harris (D-CA), Cory Booker While these legislative efforts would provide
(D-NJ), Elizabeth Warren (D-MA), and Kristen coverage to those who are uninsured and under-
Gillibrand (D-NY) support both the concept of insured, they would also reimburse providers
Medicare for All, as well as specific legislation at Medicare rates for whatever population of
creating it. Importantly, every one of these patients eventually enrolls in the program. And
current U.S. Senators is running to be the while passing Medicare-for-All legislation is not
next President of the United States. Almost likely in the short to medium term, Medicare
as importantly, Medicare for All has become for 50+ and Medicare as a Public Option legis-
a litmus test for millions of progressives who lative efforts are increasingly being viewed as
have said they will not support any Democratic reasonable alternatives to the more disruptive
candidate who does not support it. It should be Medicare-for-All concept. All of these Medicare
noted, though, that while Medicare for All gets legislative options will continue to be front and
most of the airtime, there are other efforts that center as the country moves toward the presi-
would “extend” the Medicare program to people dential election in 2020.
06 AMGA.ORG
JUNE 2019
Recent Congressional Action than limited cost sharing (up to $200 per year)
Medicare for All on prescription drugs to encourage the use A recent tracking
On April 30, the House of Representatives Com- of generics.3 HHS would distribute providers’ poll by the
mittee on Rules held a hearing on the Medicare reimbursements through regional offices. Each Kaiser Family
for All Act of 2019.1 The committee’s decision regional office would receive a global budget
Foundation found
to hold a hearing on the legislation marked a that covers payments to providers, capital
that a majority
turning point for progressive members of Con- expenditures, special projects, health profes-
gress and advocates in the national single-payer sional education, administrative expenses, along
of Americans
healthcare system debate. The progression also with prevention and public health activities. HHS believe that
reflects the American public’s shifting views on would determine Medicare reimbursement rates the federal
the government’s role in increasing access to on a yearly basis. government
health insurance. A recent tracking poll by the While the goal of the Medicare-for-All pro- should do more
Kaiser Family Foundation found that a majority posal is gaining traction for certain members to help provide
of Americans believe that the federal govern- of Congress and the American public, several health insurance
ment should do more to help provide health questions remain regarding the overall cost of for Americans
insurance for Americans by expanding already implementing the proposed system. An analysis by expanding
existing public programs, including a Medicare by Charles Blahous of the Mercatus Center already existing
buy-in for adults between the ages of 50 and determined that a Medicare-for-All program
public programs,
64.2 More surprisingly, 56% of the Americans would add approximately $32.6 trillion to the
including a
polled supported the idea of a national federal budget over 10 years due to increased
Medicare-for-All plan, although support for the healthcare utilization and demand.4 Moreover,
Medicare buy-in
plan decreased when asked about payment the report conservatively estimated that provider for adults
methods and potential patient wait times. The reimbursements would be reduced by $4.9 tril- between the
poll, which has tracked public opinion on these lion over the same 10-year time period. However, ages of 50 and 64.
issues since 1998, will likely influence health the report notes that total healthcare expendi-
policy proposals for all members of Congress tures could be reduced by up to $2 trillion over
and the 2020 presidential campaign. the same timeframe due to prescription drug
The Medicare for All Act of 2019, introduced costs savings and lower administrative costs.5
by Rep. Pramila Jayapal (D-WA) and Sen. Bernie Another analysis, by the Goodman Institute
Sanders, would merge all existing health for Public Policy Research, noted that expansion
insurance programs (public and private) into of the Medicare-for-All system might be a step
an expanded national Medicare program for backward in care innovation in comparison to
all U.S. residents. While most legacy govern- the Medicare Advantage program, which has
ment programs would sunset, the Veterans been shown to reduce costs while improving
Administration and Indian Health Services health quality.6 Members of Congress and stake-
would remain intact. The legislation also would holders also have raised concerns regarding how
end value-based care by sun-setting existing Medicare for All would affect the Medicare Trust
value-based programs (such as those created Fund. A recent report by the Medicare Trustee
under the Medicare Access and CHIP Reau- Fund projects that the Medicare Part A hospital
thorization Act), Medicare Advantage, and and inpatient benefits will be depleted in 2026.
Alternative Payment Models (such as Account- The Trustee Fund’s report calls into question the
able Care Organizations). Medical groups would future of the current Medicare program and sug-
have the ability to contract with the Department gests a rapid expansion would cause Medicare
of Health and Human Services (HHS) to provide to become financially unsustainable.7
patient services on a case-by-case basis.
The Medicare for All Act of 2019 would cover all Medicare-X Choice
medically necessary services, including primary On April 2, Sens. Michael Bennet (D-CO) and
care, hospital and outpatient services, long- Tim Kaine (D-VA) introduced the Medicare-X
term care support, as well as vision, dental, and Choice Act of 2019,8 which would create a
audiology services. There would be no premium Medicare public health insurance plan on the
or cost-sharing requirements for patients, other Affordable Care Act Exchange and has been
AMGA.ORG
JUNE 2019 07IN WASHINGTON
Table 1
Financial Effects of Medicare for All Act, in Billions of Dollars
2022 2023 2024 2025 2026 2027 2028 2029 2030
Currently projected personal
3,859 4,077 4,309 4,546 4,824 5,120 5,433 5,766 6,120
healthcare spending
+ Added induced demand from
+435 +459 +485 +511 +542 +574 +609 +645 +684
increased coverage
– Applying Medicare payment rates –384 –411 −441 –473 –505 –540 –577 –616 –658
– Drug cost savings –61 –66 –70 –75 –80 –86 –92 –98 –105
= Healthcare spending under M4A 3,849 4,060 4,283 4,509 4,780 5,068 5,373 5,697 6,041
Currently projected national
4,562 4,819 5,091 5,370 5,696 6,042 6,410 6,799 7,213
health expenditures (NHE)
– Change in healthcare spending –10 –18 –26 –36 –44 –52 –60 –69 –79
– Admin. cost savings –83 –88 –142 –149 –158 –168 –179 –190 –201
= NHE under M4A 4,469 4,713 4,923 5,184 5,494 5,823 6,171 6,541 6,933
Source: “The Costs of a National Single-Payer Healthcare System,” Mercatus Working Paper
endorsed by former Vice President and pres- Medicare Buy-In
idential candidate Joe Biden. The legislation Other Medicare expansion bills currently being
would include coverage not currently covered discussed in Congress are the Medicare Buy-In
by the Medicare program, such as for pediat- and Health Care Stabilization Act of 2019,11
rics and maternity care. The legislation would introduced by Reps. Brian Higgins (D-NY), John B.
reimburse hospitals, physicians, and other par- Larson (D-CT), and Joe Courtney (D-CT), and the
ticipating providers using enhanced Medicare Medicare at 50 Act,11 introduced by Sen. Debbie
payment rates. However, the legislation would Stabenow (D-MI). These pieces of legislation would
allow for the continuation of employer-based allow Americans ages 50–64 the option to buy into
plans, so Americans could either continue their the current Medicare program while maintaining
public option coverage or continue coverage the current private insurance market and other
under their employer’s health insurance plan. existing public health insurance programs. They
The legislation also would allow the government would also permit employers of Americans ages
to negotiate prescription drug prices.9 50–64 receiving employer-sponsored coverage to
There is currently no Congressional Budget use their employer contributions to buy into the
Office (CBO) score regarding the overall cost Medicare program.
of this legislation. However, a recent report by Plan participants eligible for the Medicare Buy-In
KNG Health found that the adoption of a Medi- program would pay the existing Medicare monthly
care public option plan would lead to a cut of premium and would be eligible for Affordable Care
nearly $800 billion for hospital-based services Act-based premium and cost-sharing subsidies.
over a 10-year period from 2024 to 2033, while The bill would also enhance cost-sharing subsidies
utilization (and, therefore, costs) would grow as available through all Silver plans in the marketplace
a result of increased coverage.10 The analysis and would extend these subsidies to individuals
estimated that 50 million individuals would leave with incomes up to 400% of the federal poverty
their employer-sponsored plans (ESPs) to buy into level (FPL). When buy-in enrollees become eligible
the Medicare public option plan. The report also for the current Medicare program at age 65, pre-
noted that because of this shift from ESPs to the mium and cost-sharing subsidies, as well as other
public option, provider reimbursements could be coverage features, would revert to those applicable
reduced by $1.2 trillion over 10 years. to Medicare beneficiaries under current law.12
08 AMGA.ORG
JUNE 2019The Buy-In legislation would require all Medicare- 8. S.981 - Medicare-X Choice Act of 2019. 2019. Accessed May 1,
participating providers and facilities to participate in the 2019 at congress.gov/bill/116th-congress/senate-bill/981.
Medicare Buy-In and would reimburse hospitals, physi- 9. American Hospital Association. 2019. The Impact of Medicare-X
Choice on Coverage, Healthcare Use, and Hospitals. Accessed
cians, and other participating providers using Medicare
May 1, 2019 at aha.org/position-paper/2019-03-11-impact-
payment rates. There is currently no CBO estimate medicare-x-choice-coverage-healthcare-use-and-hospitals.
regarding the cost of the legislation or discussion on how 10. J. Hacker. 2018. The Road to Medicare for Everyone. The American
the legislation would be funded. However, an analysis Prospect, January 3, 2018. Accessed May 1, 2019 at prospect.org/
by Avalere Health found that nearly 13 million Ameri- article/road-Medicare-everyone.
11. H.R.1346 - Medicare Buy-In and Health Care Stabilization
cans age 50 or over who are currently uninsured or have
Act of 2019. 2019. Accessed May 1, 2019 at congress.gov/
individual coverage purchased through the private market bill/116th-congress/house-bill/1346.
inside and outside the exchange could be eligible to buy 12. Neuman, Tricia, et al. “Medicare-for-All and Public Plan Buy-In
into the Medicare program.13 Proposals: Overview and Key Issues.” The Henry J. Kaiser Family
Foundation, 9 Jan. 2019, www.kff.org/medicare/issue-brief/
medicare-for-all-and-public-plan-buy-in-proposals-overview-
Going Forward and-key-issues.
Clearly, any legislation extending Medicare coverage and 13. C. Pearson, E. Carpenter, and C. Sloan. 2016. 13 Million
Medicare payments rates to millions of people would Adults Could Be Eligible to Purchase Medicare Coverage
have a dramatic impact on medical groups. AMGA will under Proposed Clinton Plan. Avalere Health, Press Release,
continue to monitor these legislative efforts in Washing- May 19, 2016. Accessed May 1, 2019 at avalere.com/
press-releases/13-million-adults-could-be-eligible-to-purchase-
ton, and we welcome your comments on what impact this
medicare-coverage-under-proposed-clinton-plan.
legislation could have on your organizations.
Lauren N. Lattany, M.P.S., is director, government relations, at
AMGA.
References
1. S.1084, Medicare for All Act of 2019. 2019. Accessed May 1,
2019 at congress.gov/bill/115th-congress/senate-bill/1804/
text.
Now Available!
2. The Henry J. Kaiser Family Foundation. 2019. Public
Opinion on Single-Payer, National Health Plans, and
Expanding Access to Medicare Coverage. Published: April
24, 2019. Accessed May 1, 2019 at kff.org/slideshow/
public-opinion-on-single-payer-national-health-plans-and-
expanding-access-to-medicare-coverage.
3. B. Sanders. 2019. Options to Finance Medicare for All.
Accessed May 1, 2019 at sanders.senate.gov/download/
options-to-finance-medicare-for-all?inline=file.
4. C. Blahous. 2018. The Costs of a National Single-Payer
Healthcare System. Mercatus Center, George Mason
University. Accessed May 1, 2019 at mercatus.org/
2018 Medical Group
system/files/blahous-costs-medicare-mercatus-working-
Compensation and
paper-v1_1.pdf. Productivity Survey
5. Ibid.
6. J. Goodman. 2018. What You Need To Know
About Medicare For All, Part I. Goodman Institute
for Public Policy Research, September 7, 2018.
Accessed May 1, 2019 at goodmaninstitute.org/
what-you-need-to-know-about-medicare-for-all-part-i.
7. Centers for Medicare & Medicaid Services. 2019. 2019
Annual Report of the Boards of Trustees of the Federal
Hospital Insurance and Federal Supplementary Medical Also: Updated Interactive
Insurance Trust Funds.” Accessed May 1, 2019 at cms.gov/
Research-Statistics-Data-and-Systems/Statistics-Trends- Online Compensation Database
and-Reports/ReportsTrustFunds/Downloads/TR2019.pdf.
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