U.S. Rep. Antonio Delgado (D-Rhinebeck) took another step towards fulfilling a campaign promise this week, and made a bid for a leadership role in the House’s restive freshman class with a new bill that would allow Americans of all ages to buy into government-backed “public option” health insurance plan, using the same Medicare providers network available to Americans over age 65.
The Medicare X Choice Act of 2019 was introduced by Delgado, fellow New York congressman Brian Higgins and Connecticut representative John Larson on Monday. The bill would allow Americans of any age or income level to buy into a health plan that utilizes existing Medicare providers and reimbursement rates. The plan would be offered through the Obamacare health care exchanges, where it would compete with private insurers. The bill also directs the secretary of Health and Human Services to recruit additional providers into the network to handle services like obstetrics and pediatrics that are not currently covered by Medicare, and to accommodate new participants.
“I think this is a practical and robust way to achieve universal healthcare and I am thrilled to be able to take the lead on this.”
The bill is in keeping with a key Delgado campaign promise — to provide a public option for consumers that would effectively set a baseline of quality and affordability for private insurers while filling gaps in the Obamacare marketplace, particularly in rural areas. In a seven-way primary campaign for the Democratic nomination for New York’s 19th Congressional District seat, Delgado set himself apart from his opponents on the left who advocated an entirely government-run health system under a “Medicare for all” single-payer system that would eliminate the private health insurance industry.
In a conference call with reporters on Wednesday, Delgado stood by his position that the public option is the most practical and achievable route to universal coverage, since it would allow people who are happy with their private insurance plans to keep them.
“[Medicare X] builds consensus,” said Delgado. “It doesn’t pit people who are on the same side against each other.”
Startup cost: $1 billion
The plan would be funded through a billion-dollar allocation for startup costs. After that, it’s designed to be self-sustaining through premiums. Those premiums would be placed in separate trust fund from the one used to pay for Medicare for people 65 and older. Delgado has previously said that he expected a public option health plan to create significant cost savings, since the cost of processing Medicare claims is typically much lower that private insurance claims. Delgado’s plan also would increase affordability for middle-class consumers by eliminating Obamacare’s cap for receiving premium tax credits to buy insurance. Currently, the credits are limited to those making less than 400 percent of the federal poverty limit; the Medicare X Choice plan would make the credits available to anyone paying more than 13 percent of their income for health insurance.
The bill is also intended to address one of Obamacare’s major failings: the lack of affordable, or in some places any, coverage on state healthcare exchanges. The act is slated to roll out in rural areas where there is no, or only one, health insurance provider on the exchange.
If passed into law, Delgado’s public option plan would become available to the entire individual market in 2024. In 2025, small businesses would be able to purchase group coverage on the Small Business Health Options Program exchange. The bill also aims to increase access to healthcare providers in rural areas by authorizing the secretary of Health and Human Services to boost reimbursement rates under Medicare X Choice by 25 percent in areas identified as having a shortage. Finally, the act includes another Delgado campaign promise — allowing the Medicare system to negotiate prescription drug prices with pharmaceutical companies.
Does it have support?
Delgado’s bill is the first to emerge from a new crop of House Democrats who campaigned heavily on healthcare in the face of Republican efforts to repeal Obamacare. The move sets the stage for a showdown between Democrats who want to eliminate private health insurance altogether and establish a government-run system and those like Delgado who favor a more incremental approach. On the conference call, Delgado said that he had discussed his plan with House leadership who he said he believed recognized the need to take action to reduce healthcare costs.
“I’m pretty well-positioned to rally support from this new crop of [lawmakers] who, like me, made their way through this campaign talking about the need to achieve affordable healthcare,” said Delgado. “And I think the leadership understands that.”