How the Bipartisan Budget Act Impacts Key State Health Care Programs

The Bipartisan Budget Act of 2018, which continues government funding through March 23, 2018, addressed funding for several health care programs that heavily impact states. The temporary federal budget includes bipartisan agreement on discretionary budget caps for two years, which should help Congress put together a larger omnibus spending bill in March. The following outlines some key health-related provisions in the bill of interest to state health officials.

Children’s Health Insurance Program (CHIP)

  • Provides an additional four years of funding for CHIP at the regular enhanced CHIP match rate, resulting in 10 years of federal CHIP funding through FFY 2027 (the January continuing resolution (CR) provided six years of funding for CHIP, and phased down and after FFY 2020 eliminated the current 23 percent enhanced CHIP match rate).
  • Continues the maintenance of effort (MOE) requirements through FFY 2027 for children in families with incomes up to 300 percent of the federal poverty level (FPL). The January CR continued MOE through FFY 2019 as in current law, and extended it to FFY 2023 for families with incomes up to 300 percent FPL.
  • Extends the following through FFY 2027:
    • Child enrollment contingency fund;
    • Qualifying state option, which provides the CHIP-enhanced matching rate for Medicaid-enrolled children in states that had expanded children’s coverage before the establishment of CHIP in 1997;
    • Authority for states to use Express Lane Eligibility;
    • Funding for outreach and enrollment grants; and
    • Funding for the Pediatric Quality Measures Program. Also, beginning in FFY 2024, states will be required to report on the quality measures in the child core set, currently reporting is voluntary.

Maternal, Infant, and Early Childhood Home Visiting (MIECHV) Program

  • Extends funding for the MIECHV program through FFY 2022, and maintains the current level of funding at $400 million per year.
  • Gives states the option to implement a “pay-for-outcomes” initiative. This allows them to use up to 25 percent of federal funds to support outcomes or success payments to home visiting programs that demonstrate improved outcomes.

Federal Health Safety Net Programs

  • Extends federal funding for the Community Health Center Fund for two years (FFY 2018 and FFY 2019) by $3.8 billion in FFY 2018 and $4 billion in FFY 2019. (In FFY 2017, community health centers received, in total, around $5 billion through a combination of $3.6 billion in mandatory funding from the Community Health Center Fund and $1.2 billion in discretionary appropriations.)
  • Extends federal funding for the National Health Service Corps for two years (FFY 2018 and FFY 2019) by $310 million each year. (In FFY 2017, the corps received, in total, around $380 million through a combination mandatory funding and discretionary appropriations.)
  • Extends and expands the Teaching Health Centers Graduate Medical Education program for two years (FFY 2018 and FFY 2019) by $126.5 million each year. (This is an increase from $60 million in funding in FFY 2017.)

Prevention and Public Health Fund

  • Returns $400 million to the Prevention and Public Health Fund over three years (FFY 2019 to FFY 2021), bringing the prevention fund to $950 million in FFY2020 and FFY2021.
  • Cuts the fund between FFY 2022 and FFY 2027 by $1.35 billion, compared to current law. Restores funding to $2 billion in FFY 2028.
  • The reductions to the fund, compared to current legislated funding levels, compound prior cuts. Over time, states are expected to lose millions of federal dollars that currently support state efforts to prevent disease, conduct immunization programs, respond to infectious disease crises, and promote health and well-being.

Medicaid Disproportionate Share Hospital (DSH) Payments

  • Delays DSH cuts until FFY 2020, and then increases scheduled payment reductions for FFY 2021 to FFY 2025 to $8 billion for each fiscal year.