“It is a disgrace that people’s lives are upended daily in our country because they have no health insurance. We need to cover everyone, reduce costs, and improve quality—and Medicare-X is the best way to accomplish those objectives. Medicare-X starts in rural areas because the market there is failing too many Americans. And by using the existing Medicare framework, it provides a new, affordable option without adding bureaucracy. There is no excuse for us not to finish what the ACA started and close the coverage gap in America through Medicare-X.”

- Senator Michael Bennet

Despite the success of the Affordable Care Act, too many Americans still live in areas with limited competition and unaffordable health care costs. In 2019, 17 percent of those enrolled on the exchanges lived in an area with just one insurer.

U.S. Senators Michael Bennet (D-CO) and Tim Kaine (D-VA) have a plan to create Medicare-X, a public option that would offer families, individuals, and small businesses additional, low-cost health insurance choices and create competition in the marketplace.  

Medicare-X initially would be available on the individual exchange in areas where there is a shortage of insurers or higher health care costs due to less competition—including in rural communities in Colorado and Virginia. By 2024, Medicare-X would expand to every ZIP code in the country. By 2025, the public plan would be added as another option on the Small Business Health Options Program (SHOP) Marketplace.

Medicare-X would use Medicare’s network of doctors and providers and guarantee the essential health benefits established in the ACA, such as maternity care and mental health services. Additionally, it would ensure access to affordable prescription drugs by offering prices negotiated in conjunction with the Medicare Part D program.

Medicare-X Summary

  • Establishment and Plan Availability

    In 2021, the Bennet-Kaine Medicare-X plan would be available in areas with one or fewer options on the Exchange. The plan would also be available in rating areas with a shortage of providers or a lack of plan competition, including HPSAs and rural areas. By 2024, the plan would be available in all rating areas. In 2025, it would be available on the Small Business Health Options Program Exchange.

    The bill allows the HHS Secretary to contract with outside entities to process claims or administer additional components of the plan. This includes contractors that currently administer certain functions for Medicare. The bill also directs the Secretary to gather data from State Insurance Commissioners in order to set adequate premiums.

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  • Benefits
    The plan would cover essential health benefits to align with other plans on the Exchange. Benefits like maternity and newborn care, as well as pediatric services, are optimally suited for Americans under 65, making it practical for families. The bill directs the Secretary to create options in the silver and gold tiers with flexibility to add bronze and platinum options. Advance Premium Tax Credits and Cost-Sharing Reduction payments would be available to enrollees. Return to Top
  • Elimination of the Subsidy Cliff by Expanding Eligibility for Premium Tax Credits
    The bill would eliminate the subsidy cliff by extending eligibility for the premium tax credit to those at and above 400% FPL. Individuals at 400% FPL would pay 9% of their income toward the “benchmark plan,” increasing to 13% of their income at 600% FPL and above. Return to Top
  • Enhancing Premium Affordability for Those Earning Less Than 400% FPL
    For Americans below 400% FPL, the bill would reduce the percentage of income one is expected to contribute to the benchmark plan by 0.5 percentage points. These enhancements would promote affordability and encourage more families to get covered. Return to Top
  • Reinsurance
    The bill authorizes 3 years of funding for a national reinsurance program at $10 billion per year, which would reduce premiums. Return to Top
  • Provider Network Reimbursement Rates
    Providers who participate in Medicare and/or Medicaid would also accept Medicare-X patients. The bill directs the Secretary to enroll additional providers, such as pediatricians and OB/GYNs. The bill reimburses providers at Medicare rates, with flexibility for the Secretary to reimburse up to 125% of Medicare rates for hospitals and physicians located in rural areas. Return to Top
  • Prescription Drugs
    The bill gives the Secretary authority to negotiate drug prices under Part D and permits the public plan to participate in those arrangements. The Secretary is encouraged to utilize value-based payment arrangements for prescription drugs. Return to Top
  • Delivery System Reform for an Enhanced Health Plan
    The bill directs the Secretary to use outcomes-based alternative payment models that are aimed at care coordination for patients with chronic conditions. Providers would use innovative technology, such as telehealth and remote patient monitoring, and integrate social services like food, housing, and transportation. The bill additionally authorizes the Secretary to establish a grant program that would allow for broader experimentation with accountable communities for health, in order to integrate social needs in the delivery of health care services. Return to Top
  • Funding
    The bill would set premiums to cover the full actuarial cost of the plan, including administrative costs. Return to Top
  • Traditional Medicare
    The bill would have no effect on benefits offered through Medicare Fee-for-Service (FFS), Medicare Advantage, or the Medicare trust fund. Return to Top
  • Cosponsors

    In addition to Bennet and Kaine, the legislation is cosponsored by U.S. Senators Ben Cardin (D-MD), Amy Klobuchar (D-MN), Patrick Leahy (D-VT), Tina Smith (D-MN), Debbie Stabenow (D-MI), Kamala Harris (D-CA), Cory Booker (D-NJ), Gary Peters (D-MI), and Dick Durbin (D-IL).

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