Formulary guidance and transparency from P&T to point of care

Radar On Market Access: What's Next for Health Insurers in a Likely Split Congress?

Posted by Leslie Small on Nov 12, 2020


Though the new makeup of Congress may not be cemented until runoff elections take place in Georgia, perhaps the most consequential outcome of the 2020 general elections for the health insurance industry is that no one political party is likely to control the White House and both chambers of Congress, AIS Health reported.

"[I]t is evident there is no 'blue wave' as Republicans appear to have held the Senate," Citi analyst Ralph Giacobbe advised investors on Nov. 5. "The news drove significant outperformance within the managed care space," he observed. On Nov. 7, the presidential election was called in favor of former Vice President Joe Biden.

Jefferies analyst Brian Tanquilut, in his note to investors on Nov. 5, pointed out that a split Congress helps health insurers because it "essentially eliminates" the risk associated with Medicare for All gaining traction and generally limits legislators' ability to advance progressives' health care priorities.

In addition to implementing a public insurance option and lowering the Medicare eligibility age, other Democratic health care priorities that likely won’t happen with a GOP-controlled Senate include expanding Affordable Care Act (ACA) subsidies to middle-income individuals and allowing the federal government to negotiate Medicare Part D drug prices, Larry Levitt at the Kaiser Family Foundation, wrote in a Nov. 5 post on Twitter.

Kathryn Bakich, National Health Compliance Practice Leader at Segal, points out that a split Congress is also less likely to pass legislation that rescues the ACA if all or part of the law is struck down by the Supreme Court, which on Nov. 10 heard oral arguments in a case challenging the law's constitutionality.

One area where the Biden administration and Congress will likely train their sights is on surprise medical billing.

Yet bipartisan support for a surprise-billing fix existed long before the election — including an executive order from Trump directing Congress to pass such legislation — and still a solution failed to materialize.

"Presumably if you had an administration that had really great negotiating skills, they could get everybody in the same room and say, 'We've got to figure this out; we're not leaving until we do,'" says Stephanie Kennan, a member of McGuireWoods Consulting's federal public affairs group. "But I think people have tried that."

Subscribe to the MMIT blog for more pharma, provider, and payer perspectives on key topics that affect the healthcare network.

Subscribe for Weekly Perspectives

Topics: Industry Trends, Payer