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Exchange Subsidy Debate Still Dominates Hill

The Exchange subsidy debate continues to dominate Capitol Hill.

Sen. Amy Klobuchar, D-MN, predicted Sunday that the Senate will hold a vote on extending Exchange subsidies. “That vote will happen. And whether it will pass is in the hands of Donald Trump and the Republicans,” Klobuchar told CNN. Senate Majority Leader John Thune, R-SD, has committed to a vote, while House Speaker Mike Johnson, R-LA, has not.

House Minority Leader Hakeen Jeffries, D-NY, is pressing centrist Republicans to help Democrats extend the tax credits before they expire at the end of the month by signing on to his discharge petition to force a vote in the House. Moderate Republicans in the House say they have their own discharge petition but are waiting to see what the Senate does.

Many are critical of President Trump’s equivocation on the subsidies – in one breath he is ready to present an extension and mini-reform plan and in another backing away and saying he does not want to extend subsidies. Centrists in the GOP want a clean extension perhaps with some small conservative tweaks on income caps, minimum premiums, and fraud protections. But conservatives want a fairly major remake of healthcare, migrating to individually controlled  subsidies for coverage.

Former George W. Bush White House deputy chief of staff and GOP strategist Karl Rove said Republicans need to have a healthcare agenda ahead of the midterm elections or they’ll be in “deep trouble.”

Additional articles: https://thehill.com/policy/healthcare/5627171-klobuchar-predicts-aca-senate-vote/ and https://thehill.com/homenews/house/5628255-obamacare-tax-credits-extension/ and https://www.politico.com/news/2025/12/01/trump-health-care-subsidies-congress-00671172

#exchanges #healthcare #coverage

https://thehill.com/homenews/campaign/5627604-gop-health-care-agenda

Populist Trump Attacks Health Plans

President Donald Trump has turned to attacking health plans in the wake of a concerted effort from Democrats accusing him and the GOP of not doing enough to tackle affordability. Trump was thought to be preparing an enhanced subsidy extension plan, but it is either delayed or won’t happen due to opposition from GOP conservatives in Congress. Trump is said to have supported a two-year extension with some reforms of the enhancements along with introducing subsidies for Health Savings Accounts for some to use.

 In a recent social media post he directed his ire on healthcare affordability to health plans, saying: “The only healthcare I will support or approve is sending the money directly back to the people, with nothing going to the big, fat, rich insurance companies, who have made $trillions, and ripped off America long enough.” Of course, that is not true.

But Trump may have the pulse of the nation. A recent poll determined 63% of those surveyed saying insurance companies were the most responsible for medical debt and 76% saying they want the country to switch to a different health insurance system in which they can be unemployed or self-employed and still remain insured. And 74% in a poll said they were in favor of Congress extending the credits rather than letting them expire. But when asked if they should be extended when reminded they were enhanced during the COVID pandemic, support drops dramatically.

But the public is not aware of the fact that health plan margins fell to 0.8% last year. Another analysis found negative earnings from 2019 to 2024, with other healthcare entities doing much better.

#healthplans #trump #populism #exchanges #coverage #healthcare

https://thehill.com/policy/healthcare/5621976-trump-blames-insurers-healthcare

— Marc S. Ryan

What Is On GOP Menu For Subsidies?

A good article in The Hill on Thanksgiving breaking down the GOP dilemma on what to do with the Exchange enhanced subsidy expiration that is looming. The issue pits moderate Republicans against conservative ones. There are competing proposals across the House and Senate.

The dilemma: Extend the subsidies and endorse Obamacare or let the subsidies expire and deal with the electoral fallout in 2026. This could be major in dozens of moderate Republican swing districts in the House and several seats in the Senate.

Here are some bills percolating on the Republican side:

Moderates in both parties in House:

One bill would extend the enhanced subsidies for two years but make some changes to assuage conservatives. Those earning less than $200,000 per year for a family of four would keep their subsidies and those earning between $200,000 and $300,000 for a family of four would face a phaseout. Fraud measures would be adopted as well. The bill would extend open enrollment to May 15 given the mass confusion over what subsidies will or will not be and the sticker shock of published premiums. 

Another bipartisan group in the House back a two-year subsidy extension with an income cap. It is partially paid for by cutting Medicare Advantage overpayments.

Another moderate bill backs a one-year extension.

Senate HELP Chair Bill Cassidy, R-LA:  

The plan from Cassidy would let the enhanced subsidies expire. Congress would then deposit money directly into health savings accounts (HSAs) for people who buy high-deductible plans on the Exchanges. The original subsidies would still go toward marketplace premiums. His idea takes advantage of a change made in the One Big Beautiful Bill Act (OBBBA), which allowed Bronze plans to be eligible for HSAs. Bronze plans feature lower premiums but high deductibles and only 60 percent coverage for medical expenses. HSAs can’t be used to pay for monthly premiums under current law. Republicans like the HSA idea, but there are many critics of and problems with the proposal. They argue it does not provide affordable access. 

Sen Rick Scott, R-FL:

Scott’s legislation centers on HSAs and would let the enhanced subsidies expire. Scott’s bill lets states submit a waiver to the federal government to replace the base Exchange premium tax credits and instead fund “HSA-style Trump Health Freedom Accounts.” Unlike traditional HSAs, people could use the funds to pay for both premiums and health expenses. In addition, states could waive certain provisions of the Affordable Care Act, including mandated benefits, among other things. The HSAs could be used for any type of health insurance plan, including short-term plans. Again, Republicans like the individual purchase idea, but the proposal could undermine the stability further in the Exchanges by increasing risk in the program as healthier people leave. It would impact sicker people receiving coverage.

The Trump non-plan:

The president was said to be on the verge of offering a plan that would temporarily extend the enhanced subsidies, potentially for two years, while incorporating income caps, minimum premiums, and fraud protections. The plan also would have HSA contributions and other incentives for enrollees to choose a high-deductible plan.

Trump appears to have backed off presenting something due to opposition from hardline conservatives in Congress.

Let’s hope for a responsible compromise to help Americans with healthcare this holiday season. It is not their fault that things have become so unaffordable.

Happy Thanksgiving!

#exchanges #healthcare #coverage

https://thehill.com/policy/healthcare/5624197-aca-subsidies-republican-options

— Marc S. Ryan

Deeper Dive On 2025 Medicare Drug Price Negotiations

The Trump administration announced the results of the second round of Medicare drug price negotiations, taking credit for the 2025 process that it says led to much deeper price reductions than in 2024’s process. The 2025 set prices will go into effect in 2027.

The administration said $12 billion in federal savings would occur due to the negotiations in 15 drugs. That is computed at 44% off of net (after rebates) costs, compared with 22% or $6 billion under Biden’s negotiations in 2024 for ten drugs. Under another calculation, the 2025 savings is $8 billion or 36%. Consumers would save an estimated $685 million in out-of-pocket costs. The medications are used by about 5.3 million Medicare beneficiaries. The negotiated savings range from 38% to 85% off the drugs’ list prices. Total spending on the drugs is about $42.5 billion.

The administration reached agreement with brand drug makers on all 15 drugs, which include treatment for cancer and a number of disease states such as diabetes and asthma.

 It appears that the prices obtained on some GLP-1s, Ozempic and Wegovy, are not as low as what President Trump struck with Novo Nordisk earlier.

All this said, it must be remembered that drug prices will remain markedly above other developed countries even with these negotiations. Right now, Americans pay over three times more generally and over four times more for brand drugs than those in other countries. Our per capita spending is well more than double those nations. Despite the year-over-year drug price reduction progress, I believe most-favored-nation pricing must come quickly and cover all drugs in all lines of business. The savings from Medicare drug price negotiations or even Trump’s direct discussions is simply not enough.

Additional articles: https://www.politico.com/news/2025/11/25/trumps-cms-touts-12b-savings-from-medicare-drug-price-negotiations-00669231 and https://www.healthcaredive.com/news/medicare-price-negotiation-wegovy-ozempic-trelegy-2027/806578/ and https://www.cms.gov/files/document/fact-sheet-negotiated-prices-ipay-2027.pdf and https://www.medpagetoday.com/publichealthpolicy/medicare/118727 and https://www.kff.org/quick-take/understanding-the-trump-administrations-negotiated-drug-prices-for-medicare/ and https://thehill.com/policy/healthcare/5623364-trump-medicare-drug-price-negotiation/

#drugpricing #ira #branddrugmakers #cms #medicare #partd

https://www.fiercepharma.com/pharma/medicare-unveils-price-reductions-15-drugs-including-novos-semaglutide

CMS Revamps Star Program For Medicare Advantage

The Centers for Medicare and Medicaid Services published a draft Medicare Advantage (MA) and Part D rule for 2027 that would make sweeping changes in the MA Star program. Beginning primarily in the 2027 measure year (MY) or Star Year (SY) 2029, CMS proposes to remove 12 (really 14) measures, largely focused on administrative processes or those that no longer show variability in quality among plans. (The call center measures will be removed in MY 2026/SY 2028.)

These are:

Administrative/Operational measures removed:

• Two Part C Appeals
• Part C and D Call Center
• Part C Special Needs Care Management HRA completion
• Part C and D Complaints
• Part C and D Disenrollment
• Medicare Plan Finder Price Accuracy

No longer showing variability:

• Diabetes Care – Eye Exam
• Statin Therapy for Patients with Cardiovascular Disease
• CAHPS Customer Service
• CAHPS Rating of Health Care Quality

The above has the effect of transferring so-called Star power to clinical, drug, and remaining CAHPS survey and HOS survey measures.

The Excellent Health Outcomes for All (EHO4all, the former Health Equity Index), will not be implemented for SY 2027 (MY 2025). The Reward Factor would be maintained for consistently high-performing plans.

CMS also proposes to introduce a new Depression Screening and Follow-Up measure that would begin with MY 2027/SY 2029.

The changes could have a huge impact on plans. CMS says this is the estimated impact on Star ratings:

• 62% of contracts will have no impact to Star ratings
• 13% of contracts will have an increase of one-half Star
• 25% of contracts wll have a decrease of one-half Star
• One conract would drop by one Star

CMS proposed a number of other changes for MA in the draft rule and issued three requests for information.

I will get into more details on all this in a blog later this week.

Additional articles: https://www.cms.gov/newsroom/press-releases/cms-proposes-new-policies-strengthen-quality-access-competition-medicare-advantage-part-d and https://www.cms.gov/newsroom/fact-sheets/contract-year-2027-medicare-advantage-part-d-proposed-rule

(Some articles may require a subscription.)

#cms #medicareadvantage #stars #quality

https://www.modernhealthcare.com/politics-regulation/mh-medicare-advantage-star-ratings-cms-2027

White House To Unveil Exchange Subsidy Compromise

The White House is expected to reveal a plan to address rising medical costs as well as the expiration of the enhanced Exchange subsidies. It was expected today but was delayed to address concerns by GOP conservatives.

The plan is said to include an extension of the premium subsidies for two years but would include income limits for the subsidies and minimum premium requirements. Incomes are said to go as high as 700% of the poverty limit to still get a subsidy. The plan also would call on Congress to appropriate funds for cost-sharing reductions (CSRs). These were defunded by Trump 45 and led to increases in Silver premium subsidies, actually a greater cost to the government.

The plan also would endorse a conservative approach where Americans would have an option to receive part of their tax credit in a tax-advantaged savings account if they move down to a lower-premium health plan.

Health Affairs has a good blog on the history of the Exchanges, tax credits, subsidy enhancements, and Democratic and GOP extension and reform proposals.

Additional articles: https://www.fiercehealthcare.com/regulatory/white-house-poised-reveal-healthcare-cost-plan-media-reports and https://www.healthaffairs.org/content/forefront/extending-enhanced-premium-tax-credits-things-stand

(Some articles may require a subscription.)

#exchanges #healthcare #coverage

https://www.politico.com/news/2025/11/23/white-house-to-propose-new-health-care-framework-00666701

GLP-1 Drug Makers Go Direct With Employers

Seeing the changes that are coming on drug prices, GLP-1 brand drug makers Eli Lilly and Novo Nordisk plan to sell their popular obesity drugs direct to employers rather than using the traditional drug sales channel that includes pharmacy benefits managers (PBMs) and rebates. In part, this is because price deals with President Trump drop drug costs considerably in Medicare and rebates will go away there. As well, this is to boost sales and get employer groups to keep or expand to obesity coverage for the drugs as opposed to use just for other disease states.

The drug makers will offer Zepbound and Wegovy to companies starting Jan. 1 through Waltz Health, a firm that helps employers purchase cheaper medications. Lilly and Novo already sell direct to cash customers.

While I have applauded the president on his drug agenda, I have doubted parts of the approach because it did not lower price and eliminate rebates for the commercial sector. But this shows that the Trump efforts could over time drop price there. I still think national reform is best, but you have to give credit to Trump for moving intractable Big Pharma – slowly but apparently surely.

(Article may require a subscription.)

#drugpricing #glp1s #weightlossdrugs #branddrugmakers #pbms

https://www.modernhealthcare.com/insurance/mh-novo-nordisk-eli-lilly-waltz-health

Dems Want Medicare Drug Negotiations Expanded

Democrats in the House have introduced a new bill that would expand Medicare’s ability to negotiate drug prices. The Lowering Drug Costs for American Families Act would allow Medicare to negotiate prices for more drugs each year, moving from 20 to 50, and make them applicable to the commercial market.

#drugpricing #ira #branddrugmakers #medicare #partd #commercial #employercoverage

https://www.fiercehealthcare.com/regulatory/house-democrats-introduce-bill-expand-drug-price-negotiation-commercial-market

Fiery Senate Hearing Casts Doubt On Subsidy Extension

Democrats and Republicans battled at a Senate Finance Committee hearing today on the future of the enhanced Exchange subsidies set to expire at the end of the year. The tone and tenor of the GOP suggested that a clean extension was very much in doubt, at least without major sweeping conservative changes to healthcare, if it happened at all.

Republicans largely indicated they wanted to see the subsidy enhancements expire and instead work on conservative reforms, including expansion of Health Savings Accounts to allow individuals to purchase healthcare of their choice. This comports with President Trump’s views that subsidies should be sent to Americans directly. Sen Bill Cassidy, R-LA and Chair of the HELP Committee, has proposed pairing beefed up HSAs with low-level, high-deductible Bronze Exchange plans. HSAs currently cannot be used to pay for premiums.

Democrats argue the HSA payments would be nowhere close to buy affordable and comprehensive insurance. They also indicated that time does not allow a major overhaul – millions are nearing a doubling of their premiums.

Where Republicans have some solid points is that the fallout from the expiration of the temporary enhancements do point to larger issues with the Affordable Care Act in terms of affordability. Republicans say markets have become overly regulated and very inflationary.

GOP moderates favor a short-term, one-year extension of the enhanced subsidies with some small changes to appeal to conservatives. They say broader reforms can be tackled later.

Additional articles: https://www.modernhealthcare.com/politics-regulation/mh-republicans-hsa-aca-subsidies-insurance/ and https://www.modernhealthcare.com/politics-regulation/mh-senate-finance-committee-hsa-aca-subsidies/ and https://thehill.com/policy/healthcare/5611836-trump-republicans-aca-subsidies-health-care-plan/ and https://www.healthcaredive.com/news/aca-subsidy-unlikely-republican-opposition-senate-finance/805942/

#exchanges #healthcare #coverage

https://www.fiercehealthcare.com/regulatory/republicans-press-hsa-expansion-aca-subsidy-reform-senate-hearing

Trump Says He Wants Direct Subsidies In Healthcare

President Donald Trump declared on social media that he would only consider approving legislation that provides direct healthcare payments to Americans. “THE ONLY HEALTHCARE I WILL SUPPORT OR APPROVE IS SENDING THE MONEY DIRECTLY BACK TO THE PEOPLE, WITH NOTHING GOING TO THE BIG, FAT, RICH INSURANCE COMPANIES, WHO HAVE MADE $TRILLIONS, AND RIPPED OFF AMERICA LONG ENOUGH,” Trump wrote on Truth Social. “THE PEOPLE WILL BE ALLOWED TO NEGOTIATE AND BUY THEIR OWN, MUCH BETTER, INSURANCE. POWER TO THE PEOPLE! Congress, do not waste your time and energy on anything else. This is the only way to have great Healthcare in America!!! GET IT DONE, NOW,” he added.

Senate Minority Leader Chuck Schumer, D-NY, dismissed Trump’s statement as “unhinged ramblings” that will “do nothing to lower” costs. He added the president has no idea how anything works.

Meanwhile, Senate Health, Education, Labor, and Pensions Committee Chair Bill Cassidy, R-LA, is working on a bill that would allow the federal government to contribute directly to individual health savings accounts to help people afford insurance in the Exchanges. Cassidy’s proposal would allow people who sign up for Bronze Plans on the marketplaces to get prepaid accounts to make up for the projected lapse in enhanced subsidies next year. “Who would not want to spend 100 percent of the dollars on the patient choosing the health care she wants, as opposed to 100 percent going to insurance companies and the 80 percent being spent on health care … and that health care is what the insurance company decides that you need?,” Cassidy told reporters.

Of course, both Trump and Cassidy have looked past any number of problems with the schemes. Will the Affordable Care Act (ACA) be changed? While costs are high in the Exchanges, their scheme could force premiums up even more as insurers would be uncertain as to enrollment in the devolved system. The system would be more complicated than even the current one. Do either understand that the premium subsidies and cost-sharing subsidies are only obtained on behalf of the enrollee? What are the insurance alternatives if any? Isn’t Cassidy leveraging the same Exchange system?

As usual, the GOP here is endorsing stunts rather than real reform for affordable, comprehensive coverage.

Additional article: https://thehill.com/homenews/senate/5611143-schumer-trump-health-care-payments/?tbref=hp

#healthcare #exchanges #aca #obamacare #coverage

https://thehill.com/homenews/administration/5610525-trump-direct-healthcare-payments/?tbref=hp