Before I would pay $5, $10, or $20 for games with a chance I'll like them - some are worth way more, some worth way less. With Game Pass I have a 'sunk cost' so I download and try out games much more eagerly and find myself enjoying many more indie games than before.
I have seen an interview where an indie dev said that Microsoft covered their entire development cost for a game to get it on Game Pass, leaving their sales on other platforms to be 'pure profit' in a sense.
I am not having a great time with the 'traditional publishing' model of the industry right now. If it gets shaken up, that seems like a benefit to me, not a drawback.
It seems like this model is better for the consumer (pay one fee, play whatever and however much you like), but whether or not its better for the game developers, I don't know.