On March 9, 2021, GLG ran its quarterly Virtual Healthcare Leadership Convene. GLG clients heard from our Network Member experts about a range of topics that included the state of COVID-19 in Europe and the practical fundamentals of diversity, equity, and inclusion, and President Biden’s healthcare agenda. Highlights of the final session, The Outlook for Joe Biden’s Healthcare Agenda, appear below.
For at least some time yet, Biden’s healthcare agenda will continue to be under the shadow of COVID-19, its continuing threats to public health, and how he can help the nation recover from the impact it is still having on the economy. You have only to look to the COVID relief bill to see where his priorities lie: boosting unemployment insurance, pouring money into vaccines, and putting more money against rental and utility assistance, among other topline items.
The Affordable Care Act
Biden also used the COVID relief bill to strengthen and expand subsidies around the Affordable Care Act (ACA). While the ACA is decidedly part of President Obama’s legacy, Biden shares some of the credit for passing it in the first place. He has a vested interest in making it work, and work for everybody. COVID threw a stark light on racial inequalities in access to healthcare. Biden is going to direct at least some of his attention here.
Ultimately, COVID has likely delayed any changes to the ACA that probably would have otherwise happened this year. You can expect ACA enhancements to lead healthcare priorities in 2023. Don’t expect Medicare for all. President Biden has been very consistent since the start of the campaign that Medicare for All is not on the table. It is far more likely that the Biden administration will give people the ability to buy into a Medicare-like option.
Until then you shouldn’t expect to see broader structural changes to the ACA. It is unlikely we will hear much more on Medicare/Medicaid reforms in the short term. It’s likely you’ll have to wait until the midterm elections for the former. Midterms historically have been challenging for the party occupying the White House, so Biden probably foresees a divided Congress in 2023.
Drug Pricing
Biden’s more immediate focus will be on drug pricing, so drug manufacturers should be planning for larger structural changes in the long term while working with the administration on the changes that will focus on specific projects and drugs. Big changes have two possible channels: the reconciliation process and legislation. The administration may also look to find possible regulatory authority to avoid the need to involve Congress.
Meanwhile, addressing the prices that patients have to pay for drugs is complex. Medicare Part B reimburses physicians for the prescribed drugs at their average sales price, plus a 6% add-on payment to cover physician costs and services. This could depress revenue for some manufacturers that will most likely increase prices for other payers, such as private health insurance plans, to recoup some of the lost revenue. It’s impossible to truly address drug pricing without changes to Part B. The questions will remain: How do you decrease costs without manufacturers taking advantage of it? How do you know companies are still going to do the right thing by forgoing copay? Biden speaks often against the abuse of power and will do everything to try to minimize this.
About Charlene Frizzera
Charlene Frizzera is President of CF Health Advisors, a boutique healthcare consulting firm focusing primarily on advising corporate, government, and nonprofit institutions on issues relating to Medicaid, Medicare, and health reform. Ms. Frizzera is an outstanding thought leader with exceptional operational knowledge surrounding the Centers for Medicare & Medicaid Services (CMS). In her capacity at CF Health Advisors, she serves as a Senior Advisor to Leavitt Partners in the Washington, DC, office. Formerly, Ms. Frizzera was the Chief Operating Officer and most recently the Acting Administrator of CMS. She has significant expertise in reimbursement matters, fraud and abuse issues, and healthcare reform. As Acting Administrator of CMS, Ms. Frizzera led the agency in implementing an aggressive fraud, waste, and abuse reduction program; the Affordable Care Act; and the Medicare Modernization Act, which required development of the prescription drug program.
About Greg Schultz
Greg Schultz was General Election Strategist and Senior Advisor for the Biden general election campaign and served as the Campaign Manager and architect of the winning Biden Democratic primary campaign. In his general election role, he oversaw the campaign’s engagement with the Democratic National Committee and national coordinated campaign efforts. Before working on Biden’s presidential campaign, he served as executive director of Biden’s American Possibilities PAC. Schultz worked as the senior advisor to Vice President Joe Biden and a special assistant to President Obama in the White House during the second term (2013 to 2017). He is a veteran of the 2008 and 2012 Obama presidential campaigns in Ohio, serving as State Director on the reelect. Greg has worked on local and statewide campaigns throughout Ohio and has managed winning campaigns at the local, state, and national level.