Biden’s Step by Step Approach to a Public Option
After two weeks in office, President Biden signed his first two orders in the health care sector. They laid the groundwork for a special enrollment period through the Federally Facilitated Marketplace that could ultimately give free or subsidized healthcare to over 9 million Americans. Despite of Medicare’s Hospital Insurance Trust Fund and the burden an additional enrollment period poses to the taxpayer, President Biden continues to push forward with his efforts to strengthen the Affordable Care Act (ACA).
During his campaign, President Biden opposed “Medicare for All” due to its price tag. However, the Executive Order on Strengthening Medicaid and the Affordable Care Act illustrates his plan to expand the role of government in the healthcare system and institute a public health insurance option that would significantly reduce the role of private insurance plans. The President directed federal agencies to reconsider rules and statutes that limit Americans’ access to subsidized healthcare, including work requirements, and block grant funding. This appears to be further evidence that the administration’s goal is to increase dependence on government health plans.
Building on the President’s desire to preserve the ACA, the U.S. House included ACA Medicaid expansion into the next government spending package this past week. The provisions that would make Medicaid plans free for people making up to 150% of the federal poverty level and those collecting unemployment insurance. In addition, the Energy and Commerce Committee inserted language that would increase the federal reimbursement rate for state Medicaid expenditures by 5% for all enrollees in all 50 states. These changes give the 12 states that have yet to expand their Medicaid program a huge financial incentive to do so.
With the expansion of Medicare and Medicaid under the Biden Administration, it is likely public insurance will begin to crowd out private options as private insurance premium skyrocket as a result of underpayment from government insurance. Increased premiums in the private sector will reduce competition resulting in government-funded health insurance being one of the only options. President Biden’s plans in the healthcare sector will increase spending and add to the national debt, but the effects go far beyond finances. Medicaid often offers far worse care than private insurance alternatives.
Alternately, competition in the private sector encourages providers to deliver quality care—an incentive that is missing in the public health options. Overall, President Biden’s incremental implementation of socialized medicine turns its back on the principles of capitalism by shutting out innovators and eroding the American health care market. ALEC has put forth model policy on the issue requiring prior legislative approval for the expansion of Medicaid eligibility. Antithetical to ALEC’s central principles of federalism and limited government, the new administration is attempting to push Medicaid expansion from the top down and grant unprecedented power to the federal government in state health insurance markets.