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February 12, 2018 at 01:48 PM
President Donald Trump’s new budget proposal for 2019 could provide enough funding for the Affordable Care Act (ACA) cost-sharing reduction subsidy program to make $8.1 billion in outlays in 2019.
The program helps low-income ACA public exchange plan users handle their health insurance co-payments and deductibles.
Trump and officials in his administration cut off subsidy payments to health insurers in the middle of 2017, and they are still trying to repeal and replace the ACA. But the budget proposal shows that, if the proposal were adopted as written, outlays could increase a little next year, from an estimated total of $8 billion this year.
It’s not clear whether the estimated total for 2018 reflects the fact that the Trump administration has stopped making the subsidy payments.
(Related: Trump 2018 Budget Blueprint Could Help Health Insurance IT Vendors)
Trump has questioned whether the U.S. Department of Health and Human Services (HHS) has a valid authorization from Congress to make the CSR subsidy payments, but his administration says in a detailed discussion of the budget proposal that, under current law, insurers must offer reduced cost-sharing to eligible consumers.
“The [fiscal year] 2019 budget provides a mandatory appropriation for cost sharing reduction (CSR) payments for fiscal year 2018 through the end of calendar year 2019,” officials write.
Administration officials prepared the proposal to outline spending plans for federal fiscal year 2019, which starts Oct. 1, and, in some cases, for calendar year 2019.
The Trump administration was also in charge of a budget proposal for 2018 released about a year ago, but it was not clear then how much of the proposal for 2018 was the work of actual Trump administration officials and how much was the work of Obama administration holdovers. The new budget proposal was prepared with Trump administration appointees in place at the top of HHS and the Labor Department.
Members of Congress often start from scratch and develop budget proposals of their own, but the administration’s proposal creates the framework for the coming negotiations.
Links to budget-related documents are available here.
Here are six other facts about the budget proposal of interest to agents and brokers. Most are drawn from a detailed administration analysis of the HHS budget, available here.
1. Funding for the ill-fated ACA Consumer Operated and Oriented Plans could temporarily increase.
Some of the moderate Democrats who voted for the Affordable Care Act lobbied for making the Consumer Operated and Oriented Plan (CO-OP) program a substitute for a government-run “Medicare for all” option.
(Image: Allison Bell/TA)
The CO-OPs were nonprofit, member-owned health plans started with federal loans.
Most of the CO-OPs have faced severe financial problems, in part because of delays and sudden changes in federal ACA subsidy programs, and have already failed.
The Trump budget shows HHS spending no money on CO-OPs in 2019, but it shows spending on CO-OPs increasing to $259 million this year, from $82 million last year.
2. Some HHS agencies you may have never heard of could go away.
The Trump administration has proposed eliminating the Agency for Healthcare Research and Quality and the National Institute on Disability, Independent Living and Rehab Research, and folding whatever might be of value in their operations into the National Institutes of Health.
3. National Institutes of Health funding could fall sharply.
