Medicare Expansion Hangs in the Balance as Democrats Race Towards a Deal

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A major expansion of Medicare that Democrats proposed as part of the Build Back Better initiative is in danger of being trimmed or even taken out of the legislation as lawmakers scramble to make a deal.

In their original $3.5 trillion budget proposal, Democrats included a revision of Medicare that would add coverage for dental, hearing and vision. The plan was expected to cost around $350 billion over a decade.

But now, those parts of the expansion may be dropped as lawmakers look to trim the overall cost and rework pieces of the legislation to appease centrist Democratic Sens. Joe Manchin, D-W. Va., and Kyrsten Sinema, D-Ariz.

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"About the expansions — we are negotiating and talking about that," Manchin told CNN Wednesday, adding that he's concerned about the country's deficit and pending insolvency of Medicare trust funds.

"In good conscience, I have a hard time increasing benefits … when you can't take care of what you have," he said. "So that's the difference, and that's the discussions we're having."

A sticking point

The expansion has become a major sticking point in talks for the bill. Sen. Bernie Sanders, I- Vt., has said that the new benefits must be included in legislation. He also demanded that the bill allow Medicare to negotiate lower drug prices with pharmaceutical companies.  

"Bottom line is that any reconciliation bill must include serious negotiations of Medicare and the pharmaceutical industry to lower the cost of prescription drugs," Sanders told reporters on Tuesday, adding that a "serious reconciliation bill must include expanding Medicare to cover dental, hearing aides and eyeglasses."

In addition, those in favor of adding the benefits have pointed out that doing so won't contribute to the potential insolvency of the trust fund for Medicare Part A.

"Adding dental, hearing and vision to Medicare would be in Part B, which is completely independent from the Part A trust fund," said Andrew Scholnick, a senior legislative representative on AARP's government affairs team.

"In fact [these benefits] might actually improve solvency down the road by reducing costly hospitalizations and infections that would be counted under Part A services," he said.

Some 62.8 million Americans, most over the age of 65, are enrolled in Medicare as their main form of health insurance. The program, which began in 1965, has never included dental, vision or hearing coverage for elders.

Roughly half of beneficiaries didn't have any dental coverage in 2019, and percentages are even higher for people on Medicare who are Black, Hispanic and low-income, according to the Kaiser Family Foundation.

That can mean major costs for dental care: The average out-of-pocket spend among Medicare beneficiaries who went to a dentist was $874 in 2018, according to Kaiser. The top 20% of those beneficiaries spent more than $1,000 out-of-pocket for dental care.

Medicaid expansion also in danger

Other health-care costs are also on the chopping block. Plans to expand Medicaid to close a coverage gap for low-income Americans in states that did not expand the program under the Affordable Care Act may also be cut — the proposal would cost roughly $300 billion over the next decade.  

As of October, there are 12 states that have not adopted the Medicaid expansion, according to the Kaiser Family Foundation, limiting coverage for residents and especially those without children. Closing the coverage gap would mean more than 4 million adults would become eligible for Medicaid.

Of course, details of what is in and out of the reconciliation bill will likely change as negotiations continue. While Democrats had hoped to reach a deal this week, it's still unclear that they'll be able to stick to that timeline.

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