Predictions and Prescriptions for Health Care in 2021
Most would agree that 2020 was a year of grief, loss, and a long overdue reckoning with our nation’s history of racial injustice. But the year ended on a hopeful note: in the final weeks of the year, the Food and Drug Administration authorized two COVID-19 vaccines and the immunization of the American public began.
The incoming Biden–Harris administration has pledged to provide the federal pandemic leadership that has been desperately needed since COVID-19 emerged. The administration also brings renewed hope for expanding access to affordable health care, which is critical to controlling the pandemic and restoring the economy.
As the year begins, we offer our predictions and prescriptions for health care in 2021. Many of these reflect recommendations made by the Commonwealth Fund Task Force on Payment and Delivery System Reform.
- COVID-19 pandemic. We predict that the national effort to vaccinate against COVID-19 will help to bring a sense of normalcy back to the country, but not until the second half of the year when a sufficient proportion of the population has received the vaccine. Our hope is that Congress and the new administration use this opportunity to shore up the nation’s public health infrastructure and invest in the tools and resources to marshal a more successful federal response in the future.
- Support for states. As a result of COVID-19, state policymakers are grappling with increased demand for health services and lower-than-expected revenues. These factors could jeopardize Medicaid coverage gains made over the past decade. The states need federal support to respond to and recover from COVID-19 and to prevent further erosion in coverage. Congress could provide targeted state funds in future COVID relief bills, and the administration could partner with state leaders to ensure states have the resources, flexibility, and tools to meet challenges.
- Health equity. The racial and ethnic disparities exposed by COVID-19 have energized the health sector and policymakers to address health equity. We predict that the new administration, supported by strong public sentiment, will take on health equity and social justice with dedication and well-developed policy proposals. Congress can support the administration in these efforts by protecting and expanding coverage for people of color, strengthening safety-net institutions that have borne the brunt of the pandemic, and requiring that health care providers measure and ameliorate disparities in care affecting their patients.
- Health coverage. We think it likely that the U.S. Supreme Court will uphold the Affordable Care Act (ACA) when it rules on California v. Texas in late spring or early summer. Such a ruling will enable the Biden administration to build on the ACA through expanded subsidies, proposals to encourage states that haven’t yet expanded Medicaid, and possibly even a public option — though the politics of this are fraught. Additionally, the new administration will take immediate steps to reverse administrative policies that have increased the number of uninsured.
- Value-based care. Since the ACA became law more than a decade ago, the U.S. health system has made notable advances toward value-based care. We predict the pandemic will accelerate provider interest in payment models that encourage value-based care, in part because such models also protect against losses in the event of dramatic declines in volume like those experienced during the pandemic. Value-based care makes room for innovation at the frontlines — better coordination of care among providers, increased adoption of virtual care, and home-based care that can lead to better outcomes and greater efficiency. The march toward value and new payment models will require continued attention from policymakers, investment by provider systems, and rigorous evaluation. With help from a panel of experts, the Commonwealth Fund’s Task Force report laid out a comprehensive strategy to move in that direction.
- Health care costs. Though national health spending moderated somewhat in 2020, costs remain a pressing problem that will require action in 2021. The Congressional Budget Office predicts that the Medicare Part A Trust Fund, which pays for hospital stays for beneficiaries, will become insolvent as soon as 2024. Congressional action will be needed to avert this crisis, which could jeopardize payment and care for millions of Medicare beneficiaries. To ensure the solvency of the Trust Fund, Congress should consider revenue proposals as well as spending cuts, particularly since the quickest way to reduce spending — lower provider payments — will be difficult in the midst of a pandemic. In addition, the incoming Secretary of Health and Human Services can work with Congress to address health care industry consolidation that has led to lack of competition and higher prices for both public and private payers in many U.S. markets. Exorbitant drug prices also remain a huge burden for American consumers, and we predict strong, renewed efforts to revive reforms in drug pricing policy.
As we enter 2021 on a hopeful note, with a new administration and Congress poised to make progress to improve our health system, the Commonwealth Fund stands ready to support public and private actors who share the goal of providing affordable quality health care to all. We are particularly focused on people who have been denied equal access to the vital care our health system is so capable of providing.