February 4, 2021

Breaking Down President Biden’s Executive Order on Strengthening Medicaid and the Affordable Care Act

Since taking office, President Biden has issued a plethora of executive orders, mostly related to tackling the COVID-19 pandemic and reversing or adjusting policies implemented by the last administration. As a reminder, executive orders themselves do not effectuate new policies. Rather, in most cases, they call on federal agencies to examine or institute new policies—usually through regulations.

Last Thursday, President Biden issued a broad sweeping Executive Order on “Strengthening Medicaid and the Affordable Care Act.” Most notably, the Executive Order reopens (the Affordable Care Act Exchange [ACA] website) for a “Special Enrollment Period,” from February 15, 2021 to May 15, 2021. This Special Enrollment Period will give people who need health care coverage during the COVID-19 pandemic the opportunity to sign up. In addition, the Executive Order calls on the Secretaries of the U.S. Department of Health and Human Services (HHS), Labor, and Treasury to suspend, revise, or rescind any current regs and other policies that “limit Americans’ access to health care” and to consider actions that “will protect and strengthen that access.” Specific areas highlighted for evaluation in the Executive Order include:

  • Policies that undermine protections for people with pre-existing conditions, including complications related to COVID-19; 
  • Demonstrations and waivers under Medicaid and the ACA that may reduce coverage or undermine the programs, including work requirements; 
  • Policies that undermine the Health Insurance Marketplace or other markets for health insurance; 
  • Policies that make it more difficult to enroll in Medicaid and the ACA; and 
  • Policies that reduce affordability of coverage or financial assistance, including for dependents.

So, with such a wide-ranging set of policies to review, where should federal agencies, especially the Centers for Medicare & Medicaid Services (CMS), start? As I stated in a previous Regs & Eggs post, the Trump Administration issued numerous regs and implemented initiatives to undermine key aspects of the ACA—mostly with the stated goal of increasing flexibility for health care providers, patients, states, and other stakeholders. ACEP responded to many of these policies outlining their potential impact on the coverage of emergency services and access to care for higher risk populations.

For example, in 2019, ACEP responded to a request for information on state “1332” waivers, which allows states to submit a plan to CMS that, if approved, would allow the state to develop a different way of providing private health insurance to their residents than the ACA required (i.e. qualified health plans in the ACA Exchange). The ACA included guardrails for these 1332 waivers, mandating that states must demonstrate in their plans that they would offer coverage that was as comprehensive and affordable as residents would have otherwise received under the ACA Exchange. ACEP expressed significant concerns with guidance that the Trump Administration issued to states that created more flexible definitions of “comprehensive” and “affordable” and opened the door for states to offer less comprehensive coverage options—like association health plans and short-term, limited-duration plans—to consumers. Despite ACEP’s (and other stakeholders’) objections, the Trump Administration, in its final days, decided to codify this guidance in the 2022 ACA final notice--- thereby attempting to solidify it in regulation.

Further, in that same 2022 ACA final notice, the Trump Administration implemented a policy that allows certain states to rely on private sector entities to establish their own independent websites—rather than using a centralized, Exchange-run website that consumers know and trust—in order to enroll consumers into ACA health plans. ACEP had opposed this policy, believing that it increases the risk that consumers mistakenly purchase less comprehensive and potentially more expensive health care coverage from non-sanctioned private websites.

With respect to Medicaid, the policy that this Executive Order explicitly calls out is the “work requirement,” which stems from guidance the Trump Administration issued in 2018 that allows states to tie employment status or other activities to Medicaid eligibility. According to the Kaiser Family Foundation, eight states have demonstration waivers in place that include work requirements (four others have had their state waivers set aside by courts). Going forward, the Biden Administration cannot just flip a switch to eliminate the work requirement, but will have to follow an orderly process in order to modify the state waivers that exist in these states.

Beyond this policy, another Medicaid demonstration that the Biden Administration will likely evaluate is the Medicaid “block-grant” demonstration—the Healthy Adult Opportunity (HAO) initiative. This initiative, approved last year, allows states that choose to participate with more flexibility to serve a segment of their adult Medicaid population, while capping the total federal funding that is available. ACEP had expressed concern that curtailing federal funds may leave states without sufficient resources to meet the needs of those most vulnerable in our communities. However, in early January 2021, the Trump Administration approved a state waiver from Tennessee, the “TennCare III” demonstration, that takes advantage of many of the flexibilities in the HAO Initiative.

These are just a few examples of policies that federal agencies under the Biden Administration need to review—but they are places to start. Many of the policies are now on hold during this review process, but it remains to be seen exactly how each one will be handled. A not-so-small wrinkle into the Biden Administration’s plans to evaluate all these regulations and policies is that it still does not have its full leadership team in place at HHS. Not only has President Biden’s nominee for HHS Secretary, Xavier Becerra, not been confirmed by the Senate yet, but the President hasn’t even nominated someone for the role of CMS Administrator (although now Chiquita Brooks-LaSure seems to be the frontrunner for the position). In my opinion, the CMS Administrator is one of the most important sub-cabinet level healthcare-related positions in the federal government—and it should be filled as soon as possible. Without top-level positions filled at HHS, it will be challenging to quickly make modifications to current regs and implement any new policies that advance the Biden Administration’s agenda. 

Until next week, this is Jeffrey saying, enjoy reading regs with your eggs.

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