August 13, 2021
Never Enough: Funding the Progressive Health Policy Agenda
This week, Senate Democrats muscled through a fiscal year 2022 (FY 2022) budget resolution on a party-line vote, theoretically paving the way for a $3.5 trillion spending package to move through budget reconciliation later this year. Reconciliation would allow Democrats to bypass a filibuster and enact the new spending with only 51 votes. New spending of $3.5 trillion might sound like a lot—because it is in fact a lot, it’s a ridiculous amount of money—but Democrats are already expressing concern that it won’t be nearly enough to pay for all the health care policies on their wish list. So, what’s on the table, and how might the money get divvied up? Let’s explore.
The reconciliation instructions put forward in the FY 2022 budget resolution include extending the two-year increase in Affordable Care Act (ACA) insurance subsidies that were enacted as part of the first reconciliation package earlier this year; providing coverage for Medicaid expansion eligible populations residing in states that have not expanded Medicaid under the ACA; lowering the Medicare eligibility age and adding vision, dental, and hearing benefits; adding more money for graduate medical education; expanding coverage for home-based, long-term care for seniors and persons with disabilities; providing additional funding for maternal, behavioral, and racial health equity; and boosting pandemic preparedness. The Senate Finance Committee is also instructed to generate $1 billion in budgetary savings to help fund this new spending. In addition to various tax provisions, the committee is instructed to find “health care savings.” Those savings are understood to be derived from drug price reforms, which would check another policy-promise box for Democrats.
But it turns out $3.5 trillion just isn’t enough to do all the things Democrats want to do in health care along with their other spending priorities. Biden’s proposal for expanding home-based, long-term care alone would cost $400 billion. Reports already indicate that Senate Democrats won’t pursue lowering the Medicare eligibility age (which could potentially violate the rules of reconciliation), but they will try to expand the program to cover vision, dental, and hearing services even as the Biden Administration slow walks the Medicare Trustees’ annual report on Medicare’s dire financial outlook. Democrats are also discussing a temporary extension of Biden’s enhanced ACA subsidies—rather than the permanent extension originally intended—to reduce the cost of the policy, and substantially cutting the target for pandemic preparedness funding. Most concerning for progressive lawmakers is that most of this new health care spending is dependent on the savings expected from drug price reforms, but Senate Democrats don’t appear that close to a deal on exactly how to reform drug prices. If an eventual drug pricing deal falls short of generating the $600 billion in revenue Senator Sanders (I-VT) has suggested, or even the $456 billion that H.R. 3 would have netted—there may be even less money to spread around health care priorities. And to further muddy the waters, Senator Manchin (D-WV) released a statement this week that left plenty of wiggle room, but indicated he’s disinclined to support $3.5 trillion in new spending.
To be clear, we’re still a long way from a second reconciliation bill. First, the House has to pass the budget resolution when it returns in late August. Then, work will begin on writing a reconciliation bill, the House will need to pass its version—somehow unifying progressive and moderate caucus members, and the Senate will have to revise that draft based on feedback from the Senate parliamentarian. The final bill will need to garner every single Senate Democrat vote (including the aforementioned Senator Manchin) and be palatable to both progressives and moderates in the House.
Something is likely to pass, but exactly what it will look like is far from clear. Either way it’s worth keeping in mind that the progressive agenda for health care is so expansive, even without including single-payer—that a $3.5 trillion spending package won’t be sufficient to enact all of it.
Chart Review: Rural Hospital Closures
Jake Griffin, Health Care Policy Intern
About one in five Americans, or 60 million people, live in rural America and depend on their local hospitals for essential health care. Yet rural hospitals have been closing at alarming rates over the last few years, with more than 181 hospitals closing since 2005. As the graph below shows, the number of rural hospital closings per year has fluctuated since 2005, but has been rising since 2017. Last year alone, 20 hospitals closed, making it a record year for rural hospital closures. Texas and Tennessee lead the way in rural hospital closures, with 21 and 16 closures since 2005, respectively. While key drivers for hospital closures, including low patient volume and reimbursement issues, continue, the COVID-19 pandemic has only made matters worse, and is predicted to cost hospitals an additional $53 billion to $122 billion in lost revenue in 2021, alone. Rural hospital closures pose accessibility issues to those living in the areas, as residents are forced to travel an average of 20 miles more for inpatient care services or 40 miles more for specialty services. With the rise in rural hospital closures likely to worsen due to the pandemic’s effects, rural residents may face even greater health care accessibility challenges.
Tracking COVID-19 Cases and Vaccinations
Jake Griffin, Health Care Policy Intern
To track the progress in vaccinations, the Weekly Checkup will compile the most relevant statistics for the week, with the seven-day period ending on the Wednesday of each week.
Week Ending: New COVID-19
Cases: 7-day average
Newly Fully Vaccinated:
11-Aug-21 114,190 163,761 492 4-Aug-21 96,453 208,296 406 28-Jul-21 69,640 203,984 319 21-Jul-21 44,140 222,394 251 14-Jul-21 28,855 244,208 223 7-Jul-21 16,286 241,430 189 30-Jun-21 13,770 321,206 225 23-Jun-21 11,885 406,786 249 16-Jun-21 12,436 626,951 292 9-Jun-21 15,321 731,015 355 2-Jun-21 15,066 524,318 388 26-May-21 22,374 822,956 444 19-May-21 28,107 1,065,793 518 12-May-21 34,983 1,277,840 560 5-May-21 45,625 1,474,692 586 28-Apr-21 52,315 1,509,340 620 21-Apr-21 61,236 1,530,352 627 14-Apr-21 68,735 1,782,967 644 7-Apr-21 64,374 1,609,398 619 31-Mar-21 64,119 1,394,315 700 24-Mar-21 57,175 980,862 736 17-Mar-21 53,430 1,036,791 860 10-Mar-21 54,350 968,625 1,125 3-Mar-21 61,042 927,354 1,356 24-Feb-21 64,745 854,047 1,738 17-Feb-21 74,340 752,413 1,913 10-Feb-21 100,411 710,538 2,365 3-Feb-21 130,077 489,684 2,719 27-Jan-21 160,221 3,339,610 3,177
Note: The U.S. population is 332,617,048