S. 2073: State Public Option Act

The State Public Option Act aims to establish a public health insurance option accessible through Medicaid, allowing states to offer a Medicaid buy-in program starting January 1, 2026. This act focuses on several key provisions:

Medicaid Buy-in Option

The act amends the Social Security Act to permit individuals who are residents of a state and not currently enrolled in another health insurance plan to buy into a Medicaid coverage plan. This option is designed to expand access to affordable health insurance.

Eligibility and Coverage Requirements

The act specifies that individuals eligible for this Medicaid buy-in include those defined as 'previously undescribed individuals,' meaning they do not qualify under any other provision in the act. States must ensure that individuals participating in this buy-in program receive at least the minimum required medical coverage.

Financial Participation and Cost-Sharing

The act seeks federal financial participation in the Medicaid buy-in program, providing states with enhanced funding to cover administrative expenses related to the program. States may impose premiums or cost-sharing charges for enrollees, with limits based on a family's income. For example, total premiums for a family cannot exceed 8.5% of their household income. Additionally, the act outlines how premiums collected by states will impact their medical assistance expenditures and stipulates that states must pay back a portion of excess funds collected through premiums.

Enrollment Mechanisms and Updates

The act establishes that states allowing the Medicaid buy-in will permit enrollment through state exchanges set up under the Affordable Care Act, while also enabling states to set specific enrollment periods. The Secretary of Health and Human Services is tasked with reviewing and updating Medicaid quality measures and providing state implementation funding to ensure compliance with the new provisions.

Enhanced Payments for Primary Care

The act restores a payment floor for primary care services provided under Medicaid, ensuring that payments to certain health care providers meet specified minimum rates. This section additionally includes provisions to enhance payments made to providers such as nurse practitioners and advanced practice clinicians working under specific criteria.

Coverage of Sexual and Reproductive Health Services

Under this act, comprehensive sexual and reproductive health care services must be included as part of the medical assistance provided under Medicaid. States must cover these services to qualify for federal funding under the updated plan.

Additional Funding Provisions

To support the implementation of these changes, the act allocates funding to assist states in updating and expanding necessary services and systems. A budget of $50 million is set aside for fiscal year 2026 for this purpose.

Implementation Timeline

The legislation aims for various provisions to take effect from January 1, 2026, aligning the rollout of the public option with the enrollment and operational capabilities of state Medicaid programs.

Relevant Companies

• UNH - UnitedHealth Group: May be impacted due to changes in competition with public options provided by the Medicaid buy-in option.
• ANTM - Anthem: Changes in the market landscape may affect its business strategy in health insurance offerings.
• CNC - Centene Corporation: As a provider of Medicaid services, Centene may see impacts based on the expansion and nature of state Medicaid buy-in programs.