State Public Option Act

This bill would let states offer a public health insurance option by allowing residents to buy into Medicaid. Starting January 1, 2026, people who live in a state and aren’t already enrolled in another health plan could sign up, with enrollment offered through the state’s health insurance marketplace. Many enrollees could use the same premium tax credits and cost‑sharing help that marketplace shoppers get, and premiums could be capped at 8.5% of household income. Enrollment would follow the marketplace’s open‑enrollment calendar .

The bill would also raise Medicaid pay for primary care to at least Medicare rates and extend that higher pay to more providers, including OB/GYNs, nurse practitioners, physician assistants, certified nurse‑midwives, and certain clinics. It directs health officials to update Medicaid quality measures for this new coverage by 2030 and state reporting by 2032, with $50 million in 2026 to help states implement. It requires Medicaid to cover comprehensive sexual and reproductive health care, including abortion services, starting January 1, 2026. States that newly expand Medicaid would receive enhanced federal funding for their first years of expansion .

• Who is affected

  • State residents seeking affordable coverage options through a public plan.
  • Primary care and OB/GYN providers, nurse practitioners, PAs, certified nurse‑midwives, and clinics that will receive at least Medicare‑level pay for primary care services.
  • People seeking comprehensive sexual and reproductive health services, which Medicaid must cover under this bill.
  • States that newly expand Medicaid or set up a buy‑in program; they get enhanced federal match for expansion and a 90% federal match for buy‑in administrative costs .

• What changes

  • States can sell a Medicaid buy‑in plan on the marketplace; enrollees can qualify for premium tax credits and cost‑sharing help, and premiums can be capped at 8.5% of income .
  • Medicaid primary care pay is set to at least Medicare rates for a broader set of providers and clinics.
  • Medicaid must cover comprehensive sexual and reproductive health care, including abortion services.

• When

  • Buy‑in eligibility and required reproductive health coverage start January 1, 2026 .
  • Primary care pay floor resumes after enactment, for defined periods in the bill.
  • Quality measures updated by 2030; state reporting by 2032; $50 million available in 2026 to help states implement.