House passes tweaks to shore up ACA, lower premiums

House Democrats on Monday passed a bill that would bolster the Affordable Care Act by hiking premium subsidies and incentivizing states to expand Medicaid.

The bill passed largely along party lines, and it stands virtually no chance in the GOP-led Senate. Democrats are using the vote as a campaign messaging tool days after the Trump administration reiterated its call for the Supreme Court to strike down the ACA in its entirety.

The Trump administration issued a veto threat on Monday criticizing the bill as spending billions to prop up the ACA and denouncing a drug-price negotiation provision designed to bring prices for expensive, single-source drugs closer to prices paid in other countries. Republicans argue the drug-pricing measure will stifle innovation by reducing drugmakers’ research and development budgets during a pandemic.

“H.R. 1425 reads as if the coronavirus never emerged,” the Trump administration wrote.

The Patient Protection and Affordable Care Enhancement Act was slated for passage near the 10th anniversary of the ACA in March, but the deluge of COVID-19 relief legislation delayed the bill.

Rep. Richard Neal (D-Mass.), chair of the Ways & Means Committee, said the bill would reduce the number of uninsured Americans by 4 million.

But Neal’s Republican counterpart, Ways & Means ranking member Kevin Brady (Texas) called for Democrats to end uncertainty caused by the Trump administration’s lawsuit by introducing a bill to make the individual mandate severable from the rest of the ACA.

“But House Democrats won’t do that. No. They find the political fearmongering to be too potent an election-year weapon,” Brady said on the House floor.

House Majority Leader Steny Hoyer (D-Md.) criticized Republicans’ lack of a detailed alternative healthcare plan if the ACA is struck down.

Democrats’ proposal would expand premium tax credits beyond individuals making more than 400% of the federal poverty line. Premiums for exchange plans would ultimately be capped at no more than 8.5% of income.

The bill would also direct HHS and state exchanges to establish network adequacy standards for exchange plans. HHS and states would be required to coordinate to protect consumers from rate hikes. The bill would provide $10 billion per year for states to pay reinsurance costs or lower out-of-pocket costs.

House Democrats’ proposal also targets the Trump administration’s healthcare agenda, and would rescind the Trump administration’s rule expanding short-term, limited-duration insurance plans and revoke guidance on 1332 waivers.

The new bill includes several incentives to expand Medicaid, including giving states that haven’t expanded Medicaid yet a renewed 100% in federal funds for the first three years post-expansion and reducing administrative matching funds for non-expansion states. Oklahoma is set to vote on a Medicaid expansion ballot initiative on Tuesday.

States would have to provide 12 months of continuous coverage for Medicaid and Children’s Health Insurance Program beneficiaries, which the Congressional Budget Office estimated would cost $204 billion over 10 years.

Medicaid programs across the country would be required to continue postpartum Medicaid eligibility for a year compared with the current mandate of 60 days.

To offset the bill’s price tag, Democrats attached the drug-price negotiation provision that the Congressional Budget Office estimated would save $582 billion over 10 years. The Trump administration attacked Democrats for leaving out other components of their signature drug-pricing legislation that had garnered more bipartisan support, such as capping outpatient drug costs for seniors.

The first major COVID-19 therapeutic pricing announcement came Monday, as Gilead announced a commercial price of $3,120 per five-day treatment course.