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The Health 202: Buried in Biden's stimulus plan is a 29 percent spending hike in Obamacare subsidies

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with Alexandra Ellerbeck

Expanding Obamacare subsidies — as congressional Democrats are trying to do within their coronavirus relief package — will help lower the nation’s persistently high uninsured rate.

But not by much. And at a hefty cost.

The government would spend roughly 29 percent more on subsidies to boost marketplace enrollment by 15 percent.

The Congressional Budget Office estimated the stimulus provision, which increases subsidies for private plans purchased on, would cost $34.2 billion to get 1.7 million more people into the individual marketplaces. Of those, 1.3 million would be previously uninsured, while the rest would be people transitioning to marketplace plans from some other type of health coverage.

The measure – included by Democrats in the sweeping coronavirus legislation they're trying to soon pass – is a key way President Biden and Democrats are hoping to further expand health coverage, after the 2010 Affordable Care Act made progress toward that end but still fell short of closing the uninsured gap. About 33 million Americans lacked coverage in 2019, and more have probably joined their ranks since then amid pandemic-related job losses.

Yet the cost is more per person than the government spends to insure people through its major insurance programs, Medicare and Medicaid — and illustrates just how expensive it is to rely on the nation’s for-profit insurance industry to get Americans covered.

“This is one of the most expensive ways to expand coverage,” said Cynthia Cox, an Affordable Care Act expert at the Kaiser Family Foundation who has analyzed the proposal.

The coverage expansions wouldn’t last, either. Unless Congress extended the timeline, the subsidies would return to current levels after two years. By 2023, the uninsured rate would return to current levels, the CBO said.

Yet the selling point remains: Enhancing subsidies will help more people get covered.

And the move would particularly help those likely to have lost income during the pandemic who are buying marketplace coverage because they don’t have it through their workplaces.

The measure, which is included in both the House and Senate bills, would lower the amount of income people are expected to spend on monthly premiums. 

For example, someone at 200 percent of the federal poverty level wouldn’t have to spend more than 2 percent of their income on premiums. Those earning 150 percent or less wouldn’t have to pay anything. And, for the first time, earners at or above 400 percent of the federal poverty level would be eligible for income-pegged subsidies.

It's also feasible that more people entering the marketplaces could help insurers lower premiums in subsequent years. 

It's possible the additional subsidies could persuade more people to buy plans than the CBO is estimating, especially considering that is open for a special enrollment period because of the pandemic. 

Earlier this week, the Biden administration announced it is restoring a modest amount of funds for community groups to help people enroll. The Trump administration had slashed funding for these marketplace “navigators.”

So for Democrats, expanding the subsidies is a no-brainer.

After spending the 2020 campaign promising to make health coverage more affordable, they’re happy to pass legislation helping to fulfill that pledge. And they can make the case that helping people get covered is more essential than ever during the pandemic.

Plus, the cost of the provision is flying under the radar amid the broader debate in Congress over the $1.9 trillion relief package.

“I don’t know if people will be willing to admit it’s not a bang for buck,” said Chris Condeluci, former counsel for the Senate Finance Committee and founder of a policy firm focused on the ACA.

Republicans are happy to argue the federal government won't be getting more bang for its buck.

GOP members are already annoyed by the costs of the coronavirus relief package, which Democrats are moving using filibuster-proof legislation to avoid seeking any Republican help. They’ve been arguing that much of the legislation isn’t directly related to the pandemic, instead reflecting broader liberal priorities such as raising the minimum wage.

Sen. John Barrasso (R-Wyo.) slammed the expanded subsidies during a floor speech yesterday, saying Democrats would just increase government payments without tackling the heart of the issue, which is health-care costs.

“This bill would now subsidize health insurance far beyond what was ever imagined when the House and the Senate passed the Obama health-care law — way beyond the subsidies ever envisioned in that,” Barrasso said.

Senate Majority Leader Charles E. Schumer (D-N.Y.) says the Senate will move on the package as soon as today.

“We’ll have the votes we need to pass the bill,” Schumer pledged yesterday.

His comments came even as moderate Senate Democrats maneuvered to limit some of the expenditures in the bill, over objections from liberals who insisted they had already made concessions on Biden’s first major legislative proposal, The Post's Erica Werner reports.

But Senate Minority Leader Mitch McConnell (R-Ky.) said he hoped “in the end Senate Republicans will unanimously oppose it, just like House Republicans did” when the legislation passed the House on Saturday with no GOP support.

“This is a wildly expensive proposal largely unrelated to the problem,” McConnell said. “We think this package should have been negotiated on a bipartisan basis. … Instead, the new administration made a conscious decision to jam us.”

Democrats can't afford to lose a single vote.

Schumer intends to have Vice President Harris cast the tiebreaking vote, but first he needs to ensure all 50 members of his caucus are on hand to vote yes. That hasn't always been the case this year, Paul Kane notes.

In late January, Sen. Patrick Leahy (D-Vt.) fell ill and was briefly hospitalized. A day later, Sen. Mark Warner (D-Va.) went into quarantine for a few days after coming in close contact with someone who tested positive for the coronavirus.

“Both senators returned to work quickly, but their brief absence served as a stark reminder of just how perilous the Democratic majority is in a 50-50 Senate, particularly as they plan to push through a $1.9 trillion pandemic rescue package later this week,” Paul writes. “If one Democrat has a fever, breaks an ankle or takes a bad fall, the legislative process would come to a stop until all 50 were able to vote for President Biden’s first critical legislative agenda item.”

Ahh, oof and ouch

AHH: Biden says the U.S. will have enough vaccine doses for every adult in America by May.

The new May target is two months earlier than the administration’s previous goal of having enough vaccine doses for every adult by July. The accelerated timeline reflects new confidence from the administration in production schedules from the nation’s vaccine makers, The Post’s Christopher Rowland and Laurie McGinley report.

MSNBC's Chris Hayes:

Biden hailed a commitment from pharmaceutical giant Merck to help make Johnson & Johnson’s single-shot coronavirus vaccine, comparing it to World War II efforts. The administration also said Johnson & Johnson and its contract manufacturers would move to a round-the-clock production schedule.

Johnson & Johnson’s latest goal is to produce 94 million doses of its single-shot vaccine by the end of May. Together with the pledged shots from Pfizer and Moderna — 200 million doses each of their two-shot vaccines — this should be more than enough for the estimated 260 million adults eligible for a vaccine. 

Currently, more than 100 million vaccine doses have been shipped around the U.S., with more than 50 million people receiving at least one shot, according to The Post’s vaccine tracker.

Biden said he'll use the federal government's pharmacy program to prioritize K-12 teachers for vaccinations and will also call on states to prioritize educators. The president said that his goal is for every educator to receive at least a first dose of a vaccine by the end of March.

Widespread vaccinations could herald the beginning of a gradual return to normal life. Politico reports the Centers for Disease Control and Prevention is set to release guidelines on safe activities for people who have been fully vaccinated as soon as tomorrow. The guidance will recommend that vaccinated Americans limit their social interactions to small gatherings in the home with other vaccinated individuals and that they continue to wear masks in public.

OOF: Texas and Mississippi are lifting their mask mandates.

“Texas Gov. Greg Abbott’s order to lift the state’s mask requirement and increase the permitted capacity of all businesses to 100 percent prompted sharp criticism Tuesday from health experts and government officials who deemed it irresponsible and premature,” The Post’s Erin Cunningham, Derek Hawkins and Paulina Villegas report.

Abbott (R) said that his order, which will go into effect March 10, is the result of new vaccines and therapeutics to combat the virus. But the decision comes as health officials warn about the spread of new, more transmissible variants of the coronavirus.

Mississippi Gov. Tate Reeves (R) made a similar announcement on Twitter.

While the United States saw a steady decline in cases and hospitalizations since a peak in late January, that downward trend has stalled in recent days, and cases have actually began to inch up in some places.

OUCH: The CDC says states should prioritize vaccinations for people with disabilities.

The CDC’s new guidance is part of the agency’s latest recommendations for distributing the three approved coronavirus vaccines, The Post’s Lena H. Sun reports. The health agency urged states to consider the “unique needs” of people with disabilities or cognitive decline and their caretakers, and “those with limited access to technology,” as appointments open to new groups.

The one-shot Johnson & Johnson vaccine, which does not need to be kept frozen, might be best for people who want to be immunized quickly or would have difficulty returning for a second shot, the CDC said. The agency cited people who move frequently or who live or work in homeless shelters or correctional facilities as good candidates for that shot.

Experts say that the new guidance reflects a growing concern about how to reach people who may face barriers to access, including those with disabilities or people who may struggle to sign up for vaccine appointments online. 

More in coronavirus news

A new federal report says the Trump administration failed to uphold safety protections for workers.

The Occupational Safety and Health Administration’s failure to issue new rules about coronavirus safety that companies would have been required to follow left workers unsafe, the Labor Department’s Office of Inspector General said in a new report. OSHA also performed significantly fewer workplace safety inspections during the pandemic despite receiving more complaints compared with the same period in 2019, The Post’s Eli Rosenberg reports.

“The United States has not studied the issue nationally, but workplace transmission has made for a significant portion of the infections across the country. Hundreds of thousands of essential workers in industries such as health care, groceries, warehouses and meatpacking have been infected with the virus, and tens of thousands have died,” Eli writes.

“We are concerned that since most OSHA inspections were done remotely during the pandemic, hazards may go unidentified and unabated longer, with employees being more vulnerable to hazardous risk exposure while working,” the inspector general wrote.

The report bolstered the case of labor unions and advocates for workers who argued that the Trump administration left workers at risk during the pandemic.

Elsewhere in health care

The Senate Finance Committee will vote today on California Attorney General Xavier Becerra’s confirmation as health secretary.

Becerra is expected to win approval in the committee, which will clear the way for his consideration by the full Senate, Reuters reports. The committee will also vote on Biden’s nomination of Katherine Tai as trade czar and Wally Adeyemo as deputy treasury secretary.

Becerra’s confirmation hearing before the Senate Finance Committee was marked by sharp exchanges over abortion, with Republican lawmakers questioning whether his involvement in litigation on reproductive health issues would present a conflict of interest. GOP senators also pressed the nominee on his previous support for Medicare-for-all. 

Five weeks after their last day in office, the Trump administration health officials who stayed to the end are now popping up in new roles.

Per our colleague Dan Diamond:

  • Brad Smith — who led Medicare's innovation center and served as a top White House health policy official — has launched Russell Street Ventures, the Tennessean reported on Tuesday. The firm is focused on creating or incubating health care companies that focus on serving vulnerable patients; the leadership team includes Rachel Baitel, a Trump White House veteran, and Eric Hargarten and Kara Pitts, who did stints at CMS working with Smith.
  • Brian Harrison, the former HHS chief of staff, this week unveiled his campaign for Congress in Texas' sixth congressional district. Catherine Bird, who worked closely with Harrison in senior HHS roles, is pitching in on the campaign. 
  • Meanwhile, Paul Mango, who served as deputy chief of staff, has started a consulting operation called Jackson Hole Strategic Advisors and has joined several boards, Mango told Dan.
  • Some of the most visible Trump health officials, like Jerome Adams, the former Surgeon General, and Alex Azar, the former HHS secretary, have yet to announce new ventures. A person familiar with Azar's thinking says he's intentionally taking his time.
Michigan’s former health director got a payout in a confidential separation agreement.

Michigan Gov. Gretchen Whitmer's administration agreed to pay former state health department director Robert Gordon $155,506 as part of an agreement that prohibited the two parties from disclosing information about the circumstances that led to his abrupt departure in January. 

“The agreement is the clearest evidence yet that the split between Gordon, a central figure in the state's response to COVID-19, and Whitmer was not amicable, and it shows the Democratic administration used taxpayer funds to ease his departure,” the Detroit News’s Craig Mauger reports.

Gordon’s resignation came less than eight hours after he lifted the coronavirus-related suspension on indoor dining in restaurants. Both he and Whitmer have refused to say why he stepped down.

Sugar rush