Senate Bill to Expand Medicare

May 16, 2018

Sens. Chris Murphy (D-Ct.) and Jeff Merkley (D-Ore.), with sponsorship from 11 other Democrats—Sens. Kamala Harris (D-Calif.), Cory Booker (D-N.J.), Tammy Baldwin (D-Wis.), Brian Schatz (D-Hawaii), Jeanne Shaheen (D-N.H.), Martin Heinrich (D-N.M.), Richard Blumenthal (D-Conn.), Tom Udall (D-N.M.), and Kirsten Gillibrand (D-N.Y.)—have introduced a bill to create a Medicare health plan for all ages that would be offered in state and federal health exchanges, as well as the employer-sponsored market. According to the sponsors, the goal of the bill (S. 2708) is to give every individual who is not already eligible for Medicaid or Medicare the opportunity to enroll in Medicare as an individual or every employer to purchase Medicare for their employees.

The Choose Medicare Act proposes to use initial funding of $2 billion to offer “Medicare E” plans to any consumer. Medicare E plans would provide similar medical coverage, prescription drug benefits, and provider networks as Medicare A and B plans, according to the bill’s text. The full bill text is available here and a summary of the bill is available here.

According to the supporters of the bill, Medicare is consistently rated the most popular and efficient health insurance system in the U.S. The new plan, Medicare Part E, would be self-sustaining and fully paid for by premiums. Medicare Part E would be offered on all state and federal exchanges, and people could use the existing Affordable Care Act (ACA) subsidies to help pay for it. Additionally, employers could choose to select Medicare Part E rather than private insurance to provide affordable and reliable health care to their employees. Sen. Merkley asserted that implementing Medicare E for plan year 2019 may lower consumer costs and achieve federal savings. He added that Medicare E can likely leverage Medicare’s extensive network of providers and its ability to negotiate fair prices for provider services and prescription drugs.

According to the sponsors of the bill, the Choose Medicare Act:

Increases Access, Competition, and Choice

  • Opens Medicare to employers of all sizes and allows them to purchase high quality, affordable health care for their employees without requiring replacement of employment-based health insurance.
  • Addresses the discrepancy between consumer protections in the individual and group markets by extending the Affordable Care Act’s rating requirements to all markets, to end discrimination based on pre-existing conditions once and for all.

Provides Comprehensive Coverage

  • Covers essential health benefits and all items and services covered by Medicare.
  • Provides high-quality, Medicare benefits (gold-level coverage).
  • Ensures coverage for all reproductive services.

Improves affordability

  • Establishes an out-out-pocket maximum in traditional Medicare.
  • Increases the generosity of premium tax credits and extends eligibility to middle-income earners.
  • Allows Medicare to negotiate fair prices for prescription drugs.
  • Drives down private insurance premiums with competition from Medicare.

The proposed bill may generate heated debate among congressional lawmakers since healthcare reform remains a polarizing topic in Congress.