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As predicted,
the Republicans’ “clean” continuing resolution (CR) that would fund the
government at current levels until November 21st and the Democrats’ CR
that includes an extension of the enhanced Affordable Care Act marketplace
subsidies (“ACA subsidies”) and restores $1 trillion of Medicaid cuts both
failed a third vote yesterday evening, leading to a federal government
shutdown at 11:59 p.m. In response to the many instances of the
Administration rescinding previously appropriated funding this year, the
Democrats’ CR also includes a provision that will stipulate that no funding
included in the CR can be rescinded except by an act of Congress. This is
important to prevent the reversal of any agreed upon spending that the
Senate eventually agrees on. Democrats have said they cannot agree to any
CR without this provision.
ACA
Subsidies
The Democrats
also are standing firm on including an extension of the enhanced ACA
subsidies. About 513,000 people in New Jersey are enrolled in the
state-run insurance marketplace. CBS News reported, “The cost of premiums
for people who buy their insurance through the ACA marketplaces could more
than double, rising from an average of $888 in 2025 to $1,904 in 2026,
according to a Sept. 30 analysis by KFF.”
Republicans are
insisting the ACA subsidies can be addressed separately from the CR,
pointing out that they do not expire until December 31st. However, insurers are
already preparing to send, or have sent, notices to households that they
will see increases starting in January 2026, and individuals will have to
make their healthcare purchase decisions in October and November. Absent
congressional action, premiums are expected to spike 18% on average
nationwide. Even with an extension of the enhanced credits, NJSpotlight reports that “premiums in New
Jersey under the 2010 law would rise 12.8%, according to the state
Department of Banking and Insurance.”
Nationwide,
about four million people would likely drop their insurance coverage if the
enhanced credits are allowed to expire, the Congressional Budget Office has
estimated. Others estimate that allowing the
ACA subsidies to expire will result in $32.1 billion in lost revenue for
providers. Healthcare Finance News wrote, “The burden of
the increase in uncompensated care… would fall on all provider types: about
$2.2 billion on hospitals, $1 billion on physician offices, $1.5 billion on
prescription drugs and $3.1 billion on other services. A little more than
half of the increase in uncompensated care would be financed by providers,
analysts said.”
While there is
a bill (H.R. 5145) that would extend the
tax credits for a year, which seems to have enough bipartisan support to
easily pass the House, its chances in the Senate and for the President’s
signature are less likely.
Telehealth
Update – Medicare Mental Health Services Can Be Provided if the In-person
Requirement Has Been Met
Separate from
the budget lapse, telehealth provisions for Medicare also expired at
midnight, meaning providers will not be able to bill for Medicare
telehealth services as of today unless those services are in compliance with
pre-COVID restrictions.
Pre-COVID
telehealth provisions do not allow individuals to receive telehealth
services except at eligible sites (licensed healthcare facilities)
unless in-person requirements have been met, meaning each client must have
received a Medicare covered/Medicare eligible service in person from the
telehealth provider within six months prior to the first telehealth mental
health service, and then at least once every 12 months thereafter. This
means only those Medicare clients a provider has seen in person since April
1st would be eligible for telehealth services today.
What Is and
Is Not Impacted
The Department
of Health and Human Services (HHS) announced on Monday that major
healthcare systems will not be affected much by a shutdown, at least in the
short term, noting that Medicare, Medicaid and the Children’s Health
Insurance Program, three mandatory programs, all will continue
operating. The federal health insurance exchanges will also be kept
running, with the Centers for Medicare and Medicaid Services (CMS) covering
those operating expenses with insurance company user fees. Items under
HHS’ purview that are affected include, but are not limited to the
following:
• Medicaid
disproportionate share hospital payments would see an automatic $8 billion
cut.
• Community
health center funding would lapse.
• Pay
enhancements for Medicare-dependent hospitals and low-volume hospitals
would suspend.
• Graduate
medical education funding would cease.
There are many
resources that share information on the broader impacts of the shutdown.
Here are a few we think you will find helpful:
Congressman
Norcross has developed a helpful Q&A webpage regarding the impacts
Substance Abuse and Mental Health Services
Administration (SAMHSA)
Centers for Medicare and Medicaid Services
Administration for Children and Families
Health Resources and Services Administration
All HHS Divisions
Going
Forward
The Senate is
in session today, but will not be in session on Thursday in observance of
Yom Kippur. Senators expect to be back in session Friday and perhaps
through the weekend. Any CR that passes the Senate that is different
from what the House previously passed will have to receive a vote in the
House; however, the House is not scheduled to return until October 7th. NJAMHAA will
continue to keep you updated on all aspects of the shutdown and any CR that
is agreed upon.
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