Health Care

House passes domestic policy bill with big wins for industry

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The House voted to advance President Joe Biden’s $1.75 trillion domestic policy agenda Friday, including historic expansions of the Affordable Care Act, investments in the healthcare workforce and funding for pandemic preparedness.

The package now moves to the Senate, where it needs 51 votes to pass, giving Democrats no room for error given their narrow majority. Biden has said he believes it can pass the upper chamber after speaking with key senators.

The House passage, in a 220-213 vote, marks a victory for the president, who has for months sought to win over more moderate members of the party who wanted a smaller spending bill. The version of the “Build Back Better Act” that passed the House today was scaled down significantly from $3.5 trillion, with cuts in several healthcare priorities for which providers and advocates had lobbied.

Still, if passed by the Senate, the package would extend ACA subsidies to millions more people through 2025. That includes 2.2 million people in the “coverage gap” because they reside in the 12 states that haven’t expanded Medicaid under the ACA and those with incomes four times higher than the federal poverty level. The legislation would also make subsidies more generous for low-and-middle-income people, and those in the coverage gap would become eligible for zero premium policies with minimal cost-sharing from the health insurance exchanges.

Biden campaigned on expanding access to healthcare and building on the ACA by extending coverage to those who’ve been locked out since the law took effect in 2010 and by making exchange plans more affordable through bigger subsidies.

The expansion of ACA subsidies is a win for providers, especially those in rural areas where hospitals face higher levels of uncompensated care. As a trade off for extending coverage to people in the coverage gap, however, the package would also reduce payments that help hospitals defray the costs of uncompensated care.

Hospitals have urged Congress to strip out language from the package that would reduce Disproportionate Share Hospital payments by 12.5% and cut funding for uncompensated care pools in states that haven’t expanded Medicaid. Those cuts would save the government $35 billion over 10 years, according to the Congressional Budget Office.

Experts contend that with the coverage expansions in the bill, providers in non-expansion states would see a net benefit despite the cuts. But providers note that the expanded ACA subsidies are temporary, while the changes to DSH and uncompensated care pools are permanent.

These cuts may not survive the Senate, where members including Georgia Democratic Sens. Raphael Warnock and Jon Ossoff oppose them.

Other notable provisions of the bill include:

  • 4,000 new residency slots for medical schools financed by Medicare, the biggest increase since the 1990s
  • $3.4 billion for the Teaching Health Center Graduate Medical Education and $200 million for GME programs at children’s hospitals
  • $2 billion for the National Health Service Corps and $500 million for the Nurse Corps, which provides scholarships and loan repayments to providers and nurses working in underserved areas
  • $500 million each for nursing and medical schools in underserved areas
  • Medicare coverage of hearing services beginning in 2023
  • The package would direct the Health and Human Services Department to negotiate prices with drug companies for a small number of high-cost drugs without generic or biosimilar competitors. Drug manufacturers would be required to pay rebates to the federal government if their price increases exceed inflation. Cost-sharing for insulin products would be limited to no more than $35 under Medicare and private health plans
  • Medicaid programs would be required to extend coverage for one-year postpartum in an effort to reduce maternal deaths. States currently only have to offer mothers coverage for 60 days after childbirth. The package also contains about $1 billion in grants for entities addressing maternal mortality and disparities in health outcomes
  • $150 billion to expanding home and community-based services in Medicaid
  • The bill permanently extends the Children’s Health Insurance Program, which currently needs to be periodically reauthorized by Congress
  • $2 billion for capital projects at community health centers, but no funding for infrastructure improvements at hospitals
  • $7 billion for the Centers for Disease Control and Prevention to shore up public health infrastructure

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