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Transcription

Neil: Hello and welcome to another episode of the Avalere Health Essential Voice Series focused on the 2020 election. In this series, we’ll be covering the current state of play in the 2020 election and the role of healthcare between now and November.

My name is Neil Rosacker, and I’m an Associate on the policy team here at Avalere. I’m joined today by Dan Mendelson, the founder of Avalere and—among many topics—an expert in the Affordable Care Act (ACA). I am also joined by Matt Kazan, a Principal in the Policy Practice, who brings expertise in the legislative and regulatory environment and over a decade of experience on the Senate Finance Committee. Thank you both for joining us.

In today’s episode, we’ll be reviewing the first 25 minutes or so of the Presidential debate that we saw this week, taking a close look at the potential implications for healthcare coverage and the impact on the ACA.

Dan and Matt, we certainly had a lively debate on Tuesday. But at minimum, it showed us that healthcare is likely to be front and center in the discussion leading up to the November election. They covered a number of healthcare issues, including the ACA, COVID-19, public health, health disparities, drug-pricing reform, and others.

Dan, starting with you, 1 topic that garnered particular attention was covered protections under the ACA for individuals with pre-existing conditions. A previous Avalere analysis has found that around 102 million individuals not enrolled or in Medicaid or Medicare have pre-existing conditions in the US.

Dan, help us contextualize. What does this number mean with respect to coverage security and affordability, and how should we be thinking about it in the context of the debate over the future of the ACA?

Dan: Well, first, it was very exciting for us at Avalere to hear that number discussed and debated because it’s our number. We did that analysis a couple of years back, actually, to really just understand what the implications of the ACA were on the population nationally.

It’s a shocking number in some ways. If you think about a population of 350 million in the United States, it shows that almost 1 in every 3 people have what would have been, before the ACA, characterized as a pre-existing condition. These are very common conditions–diabetes, heart disease, cancer, pregnancy–that affect so many people. If you think about a family of 5, the probability that 1 person is going to have that pre-existing condition is very high.

So, the number shows that this is an issue that affects all Americans in terms of thinking about the security of their healthcare. It does not mean that 100 million people are going to lose coverage if the ACA is repealed, but it does mean that it puts their coverage at risk. And it is that risk at a time of COVID-19 that is going to be a major driver of the election and of voters’ perception of the 2 candidates.

Matt: Neil, I think that that number has really illustrated why the debate over this issue has shifted from whether we should have increased protections to how we protect those with pre-existing conditions.

I think because the number is so big and because everyone has or knows someone with a pre-existing condition, it is just further evidence that this is where the debate has shifted. We saw that in the debate where President Trump talked about his plan to protect those with pre-existing conditions versus the ACA. It is not a debate over whether we should do this.

Dan: That’s a great point, Matt. I think the other thing to understand is that we did this analysis in 2018 and it is quite likely that the number of people with pre-existing conditions has increased. It’s quite likely that COVID-19 would be seen by an insurance company as a pre-existing condition, given the many issues that many people who have contracted COVID-19 have. This is something that we are looking at presently and will be thinking about in terms of updating the number at some point during the cycle.

Matt: Also, Dan, I’m curious about how many people have either developed pre-existing conditions or had them exacerbated because of deferred care or other secondary impacts of the pandemic.

Neil: I think it also leads us in to the next question, which is looming over the entire election: the November 10  start of the oral arguments on the California v. Azar Supreme Court case regarding the constitutionality of the ACA and, in particular, the individual mandate. Matt, we’ll be covering this in depth on a future podcast. However, as this continues to be a key topic in the presidential debates, what milestones, if any, do we expect prior to the election on the case? And what is the potential impact of this on the 2021 policy landscape?

Matt: This is potentially significant. Thinking about the next immediate steps, the Senate Judiciary has scheduled hearings over the nominee for the week of October 12. There is a potential that confirmation votes will occur prior to the election on that nominee.

With the oral arguments, which are currently scheduled for the week after the election, there is the potential that we will have a court with the new nominee or a new justice. There is the obvious question of whether the individual mandate is constitutional, but are there other provisions that would fail if it is found constitutional? There could be broad direct impacts on the law.

I also think you bring up a good point, Neil, in that there are indirect impacts on the 2021 policy landscape. Democrats have objected to the speed in which the Ginsburg seat is being filled and have talked about getting rid of the Senate filibuster in a following session if Democrats win the congressional elections. This could potentially have more immediate impact than the court case in many ways. I think the absence of a filibuster really changes the 2021 landscape in 3 ways:

1. There are more opportunities for Congress to pass bills with a simple majority vote, rather than the 60-vote threshold that, generally speaking, bills have to abide by today.
2. It opens up the types of policies that could be enacted through a simple majority vote, while today, in order to get that majority vote, you have to use reconciliation and there are very tight restrictions on the types of policies that can be included.
3. Under reconciliation, those bills must be paid for both immediately and in the long term. That may not be the case under a filibuster-free Senate. It will become more of a political question for members of Congress whether they choose to pay for legislation, while today that is much more of a process and structural decision that they are forced to do. I think the implications there are extensive, and folks should think about the impact.

Dan: I think it’s interesting to see the Supreme Court decision being framed by Biden as a healthcare issue. To me this shows is that healthcare is, in a lot of respects, the linchpin issue in this election.

COVID-19 is healthcare; the economy is healthcare. Now, we see that the Supreme Court is healthcare because of this pending decision around the ACA. If you go back and look at some of the polling, I think the fact that independent voters care deeply about healthcare is really driving a lot of this. They probably care more about healthcare than they do about procedural issues around the court and certainly about something that feels as abstract as the filibuster. Most people don’t know what the filibuster is, but I think Matt is right. This could be a very profound change on how the Senate operates going forward.

I think it’s likely that the Democrats would go there. It feels like there are no longer rules with respect to procedure and protocol, and they certainly would have a much easier time moving an agenda—which would include protection of the ACA and broader coverage for people who don’t have insurance—forward without the filibuster. That is a set of issues that I think we might be talking about after the election.

Matt: I absolutely agree that healthcare has been elevated, and it is also interesting to see that the coverage debate specifically has been elevated because of this discussion.

A Kaiser Family Foundation poll looked at specific healthcare issues and which voters prefer which candidate on those issues. The results showed that every issue within healthcare, with the exception of drug pricing, voters preferred Vice President Biden.

Whereas we saw that during the debate, President Trump shifted the healthcare conversation toward his administration’s efforts on drug pricing, and I think there’s a reason for that. It is a really interesting shift in the debate and within the campaign.

Dan: This politically also explains why Biden is constantly trying to move the debate back to COVID-19 because he maintains a double-digit issue advantage over Trump in that area. Anytime he can talk about COVID-19, it’s to his benefit. That is why everything becomes COVID-19.

As he maintains that going through to the election, you see this post–Labor Day bounce in the number of cases as being to Biden’s advantage, particularly in swing states such as North Carolina and some of the Midwest states that are facing this issue. He speaks directly to the camera and says, “I understand your pain here, and I understand what you are going through.” This issue is his strength, and he’s trying to bring the conversation back to that. We can expect more in the next debate.

Neil: Dan, it’s interesting you say that. As you know, Vice President Biden emphasized how job loss due to the pandemic has led to subsequent loss of employer-sponsored health insurance. Recent Avalere analysis estimates that the decline in employer-sponsored health insurance has actually disproportionately impacted non-White demographics in 2020, with a loss of coverage approximately doubling in Asian, Black, and Hispanic individuals compared to White individuals.

So as we think about some of the potentially accelerated health disparities in the US, what role does coverage play, and how is the COVID-19 pandemic and associated economic recession and trajectory likely to influence some of these policy discussions?

Dan: I think it’s important for our research to be a neutral, objective voice that that is shining a light on these issues. Then it becomes a question of what to do about it in the policy context.

To me, coverage is the single most important thing that an individual needs in order to access healthcare. Having strong coverage and making sure that the coverage is durable, particularly in times when there is job loss or recession, is very important for maintaining the ability to access healthcare.

Health plans are in a position to help eliminate disparities. They know a lot about their insured population, and they have the ability to reach out and help populations deal with social and medical issues. I think it’s quite likely going forward that politicians, as well as commercial insurance buyers such as employers, are going to be expecting more of health plans to reduce disparities and that health plans that lead are going to be in a very good position to help effectuate that.

Matt: I agree. Looking at the numbers over time, there were disparities in health insurance pre-ACA. While those numbers started to close since the ACA, they still existed and then we saw uptick in that gap pre-COVID. And clearly, as Neil And Dan stated, the pandemic has accelerated that.

I would expect, depending on the election and who is in control of Congress and the administration in 2021, that there are specific coverage policies that are debated that get to the heart of this gap in insurance coverage by race that will be completely separate from the general coverage debate on how we get every American insured.

Dan: I agree. And 1 thing that plans can do is use analytics to target populations to understand what’s going on. The use of analytics has tremendous potential for reducing disparities over time, because if you understand the population, you know what healthcare they are using and what healthcare they are not using. You can and should be reaching out to individuals and helping them engage to make sure they’re getting routine mammography and routine colonoscopy, to make sure that they’re accessing wellness visits, and to make sure they’re complying with their medications. These are the very interventions that are used by health plans today that can also be used to reduce disparities in healthcare.

Neil: Matt, you touched on this a little bit, but the debate moderator pressed each candidate on the specifics of their health plans and, as you said, Trump emphasized drug pricing reforms, recent executive orders on pre-existing conditions and surprise billing, and his 2017 tax cut bill, which zeroed out the individual mandate penalty, whereas Biden focused more on his public option and Medicare eligibility expansion proposals.

What are the key differences between these 2 platforms, and how should we be thinking about them as they drive the discussion leading up to November 3?

Matt: The differences are stark, especially on the coverage front. On the drug front, the President wants to pivot and talk about the actions the administration has taken. Vice President Biden’s policies and platform are in the same neighborhood as the President’s in regard to international indexing and some other policies.

There are differences, but they are much closer than they are, for instance, on the coverage debate, where there’s a giant chasm between the 2 candidates. President Trump has not articulated an exact healthcare coverage plan, though he has leaned on the willingness to protect people with pre-existing conditions, whereas Vice President Biden articulated a little bit more detail on what he envisions.

His platform has 3 big pieces, which you summarized, and we can dive into those:

1. The increased exchange affordability provisions, making tax credits and subsidies more generous and available to more people
2. The public option, which has some interesting dynamics
3. The proposal to lower the Medicare eligibility age to 60

We have fewer details on the latter 2 than on the first, which is similar to legislation that the House passed earlier. Trying to figure out the impact of the public option and lowering the eligibility age on stakeholders, on the uninsured, and on patients would hinge on the details Biden and Congress would need to fill in in 2021.

For instance, does the public option have to abide by all the same rules that plans in exchange have to abide by today? What is the dynamic around enrolling folks who would be eligible for Medicaid into the public option? And what are the puts and takes from a state perspective? On lowering the eligibility age, do these folks received the same benefits? Are they able to enroll in Medicare Advantage in Part D, just like someone who’s 67 years old does today?

These are the types of questions that we don’t know the exact answers to now. Biden and Congress would have to answer these questions in 2021 if they win the election. The crux of the impact will really be dictated by these details.

Dan:  I think that it’s fair to say that there is a fundamental difference in terms of Biden articulating a very activist agenda about expanding coverage and maintaining coverage under the ACA. There isn’t a lot of detail around some of the legislative proposals, which is by design. It doesn’t help them to come out with more details. With Biden having been in the Senate for a very long time, he has an understanding that these details have to be worked over time.

It’s very interesting to see how the 2 candidates have converged around the drug issue. You don’t hear Biden talking about it because the polling shows that voters care a lot more about COVID-19 than they do about drug costs, so he’s always going to bring things back to that turf, especially as the President has been outspoken and passionate about these pharmaceutical issues. After the election, I think either candidate would pursue policies to reduce pharmaceutical costs for American consumers.

That’s something that the President has promised, and he’d be less fettered in a second term. With respect to Biden’s engagement, I think he has a very core understanding that pharmaceutical costs are increasing as a portion of total costs. Cost control is a place where American consumers are affected very profoundly. Irrespective of the electoral outcome, that is an issue that I’m sure we’re going to be talking about a lot.

Neil: Thank you both. Dan and Matt, this has been an incredibly insightful conversation, and I hope our viewers think the same. That’s all the time we have.

Thank you everyone for tuning into Avalere Health Essential Voice. Please stay tuned for more episodes as we get closer to the 2020 election. If you’d like to learn more, please visit us at Avalere.com/2020-election.