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Creates a federally administered public health insurance option to be sold only on ACA Exchanges beginning with plan years on or after January 1, 2027. The Secretary of Health and Human Services will design bronze, silver, and gold plans that aim to be affordable while preserving quality and access, collect data for geographically adjusted premiums and payment rates, and negotiate provider and drug payment rates (with a fallback to original Medicare rates if negotiations fail). The bill establishes a Treasury account for public option receipts and payments, authorizes startup appropriations adequate for 90 days of claims reserves (repayable over 10 years starting Jan 1, 2027), allows HHS to contract administrative functions without transferring insurance risk, requires provider licensure and participation rules (including automatic inclusion of Medicare and Medicaid participating providers unless they opt out), and makes conforming changes to include the public option among qualified health plans offered on Exchanges.
The bill expands federally administered, standardized public-plan choices on the ACA Exchanges to improve affordability and access, but does so at meaningful fiscal cost and with risks to provider finances, market competition, and drug participation that could affect access and innovation.
People who buy coverage on the ACA Exchanges (including uninsured people who enroll) gain access beginning in 2027 to a federally administered, standardized public-option plan set that expands plan choices and could lower premiums and out-of-pocket costs if provider and drug payment negotiations succeed.
Medicare and Medicaid providers are automatically included in the public-option networks, increasing the breadth of provider networks and improving access to care for enrollees.
Consumers retain choice among bronze, silver, and gold plan levels within the new option, preserving eligibility for premium tax credits and ACA cost-sharing rules so taxpayers and low/moderate-income enrollees can keep existing financial protections.
Taxpayers face higher federal spending and fiscal risk because the government must fund start-up costs for the public option and may need to repay those funds over a decade if claims or costs exceed projections.
Hospitals, health systems, and clinicians could see lower payments if negotiated rates fail and the default is Medicare-equivalent reimbursement, which could pressure revenues and threaten local access to care in some areas.
Private insurers operating on Exchanges could lose enrollment or face adverse price competition from the public option, which may distort market dynamics and indirectly affect premiums for those not in the public plan.
Introduced January 12, 2026 by Janice D. Schakowsky · Last progress January 12, 2026