A potential government shutdown could affect various federal health programs. While mandatory spending programs like Medicare would continue, discretionary programs within the Department of Health and Human Services (HHS) might face funding challenges. Essential functions related to safety and property protection can persist. Short-term disruptions in Medicare enrollment are possible, and the impact on Affordable Care Act plans is expected to be minimal. A prolonged shutdown could affect more programs. Federal employees’ compensation depends on program funding, with a 2019 law ensuring back pay for government workers but not for federal contractors.
In an unprecedented turn of events, congressional deadlock looms, potentially leading to the partial shutdown of several crucial federal government operations, including significant health programs. Although certain government functions may cease or operate at reduced capacity, others may remain unaffected, such as Medicare, Medicaid, and health plans offered under the Affordable Care Act. Nonetheless, a government shutdown could introduce complications into the lives of individuals engaged with federal health programs and the personnel managing them. Here are five key insights regarding the potential consequences for health programs:
1. Diverse Nature of Federal Health Spending:
– Medicare, classified as “mandatory” spending, possesses permanent funding, requiring no periodic congressional action to sustain it.
– Conversely, numerous “discretionary” programs within the Department of Health and Human Services (HHS), including the National Institutes of Health, Centers for Disease Control and Prevention, community health centers, and HIV/AIDS initiatives, rely on Congress to allocate funding through annual appropriations bills.
– Historically, Congress has rarely succeeded in passing all appropriations bills before the start of the fiscal year on October 1, often relying on short-term funding measures or “continuing resolutions” (CRs) to maintain government operations.
2. Authority to Keep Essential Functions Operating:
– The White House Office of Management and Budget assumes responsibility for crafting contingency plans in the event of a government shutdown.
– Essential activities, crucial for the “safety of human life or the protection of property,” can continue even without annual congressional spending authority. Examples include patient care at the National Institutes of Health, CDC disease outbreak investigations, and the care of agency laboratory animals.
– Programs funded by sources independent of annual appropriations, such as Medicare and Social Security, remain unaffected. However, questions persist regarding the initiation of new approval processes for the FDA.
– Programs pre-funded by Congress, like the Indian Health Service through the 2024 fiscal year, remain operational.
3. Impact on Medicare and Affordable Care Act Enrollment:
– The duration of the shutdown dictates the extent of its impact. In the short term, mandatory spending programs like Medicare, Medicaid, and the Affordable Care Act would largely continue, though non-essential federal staff would be furloughed.
– A government shutdown could temporarily halt initial Medicare enrollment, as occurred during the 1995-96 shutdown when over 10,000 Medicare applicants were turned away daily.
– Medicare’s annual open enrollment period, starting on October 15, should proceed as planned, as most funding for beneficiary counseling services has already been allocated.
– Affordable Care Act plans, open for enrollment on November 1, are expected to function smoothly using residual fees paid by insurers, despite a potential furlough of around half of CMS staffers.
4. Prolonged Shutdown and Program Impact:
– Extended shutdowns could escalate the number of affected programs. For instance, the HHS contingency plan indicates that CMS would have sufficient funding for Medicaid only during the first quarter of fiscal year 2024.
– Since the government has never experienced a lengthy shutdown, the consequences beyond the initial period remain uncertain.
5. Compensation for Federal Employees:
– Employee compensation during a shutdown hinges on the funding status of their respective programs.
– Funded programs continue to pay employees, while “essential” workers in unfunded programs continue to work without immediate pay.
– A 2019 law mandates back pay for federal workers once funding is restored, ensuring that they receive their salaries, a measure that was not always in place.
– Federal contractors, including those in food service or maintenance roles, do not have the same guarantee of compensation during a shutdown.
In the event of a government shutdown, the impact on health programs and federal employees varies based on the nature of the programs and the duration of the shutdown, underscoring the complexity of managing these critical services during periods of congressional impasse.
