Expiration of federal funding threatens state CHIP programs

In light of the fact that federal funding for the Children’s Health Insurance Program (CHIP) expired on September 30, 2017, the Kaiser Family Foundation (KFF) analyzed the impact upon states and potential outcomes. Without an extension of federal funding for CHIP, KFF reported that states have or will run out of federal CHIP funding and may face budget shortfalls for CHIP, which covered 8.9 million children in 2016.

According to KFF under the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) the enhanced federal funding matching rate was further increased by 23 percent. With this, the CHIP federal matching rate ranged from 88 percent to 100 percent. Because nearly all the states included federal funding for CHIP when creating their FY 2018 state budgets, nearly all the states will face a budget shortfall if the federal funding is not extended.

In the absence of an extension of federal funding for CHIP, some states will have to reduce CHIP coverage. States that have CHIP-funded Medicaid expansions must maintain the underage under the ACA “maintenance of effort” requirement, leaving state costs to increase in the face of lower federal Medicaid match rate. However, states with separate CHIP coverage are not required to maintain it, and states may freeze enrollment or discontinue CHIP coverage altogether.

In the short run, states can continue to use federal funding accrued through the September 30 expiration. Eleven states reported that they would run out of federal funding for CHIP by the end of FY 2017, and at least one state reported that their funding would be depleted at the expiration date. By redistribution of unspent CHIP funds, the Centers for Medicare and Medicaid Services (CMS) was able to provide enough additional funding to allow that state to maintain coverage without a budget shortfall through October. CMS was also able to provide redistributed funds to several other states that were close to running out of funds.

In order to address the expected states’ budget shortfalls, Congress is working on legislation for continued funding. Both the Senate and the House have reported bills out of committee to provide an extension of federal funding for CHIP. The bills from the House and Senate contain many of the same provisions, including a five-year extension for federal funding of CHIP and a transition down from the enhanced 23 percent match provided by the ACA. However, the House bill includes some additional provisions not included in the Senate bill. Both bills still need to be debated and voted upon by the full House and Senate, and if both are passed, Congress will have to reconcile the difference between the two bills.

First ever indictment against Chinese manufacturers of opioids

The Justice Department recently took unprecedented steps to combat the opioid crisis in the United States by filing indictments against Chinese manufacturers of fentanyl and other opioid substances. The department has labeled these manufacturers as Consolidate Priority Organization Targets (CPOTS), which it believes are the “most significant drug trafficking threats in the world,” because they have elements of the most productive money laundering and drug trafficking organizations.

The investigations of the Chinese manufacturers revealed a new and disturbing facet of the opioid crisis in America—fentanyl and fentanyl analogues are coming into the United States in numerous ways, including highly pure shipments of fentanyl from factories in China directly to U.S. customers who purchase it on the Internet. Unwary or inexperienced users often have no idea that they are ingesting fentanyl until it is too late. The Centers for Disease Control estimates that over 20,000 Americans were killed by fentanyl and fentanyl analogues in 2016, and the number is rising at an exponential rate.

The indictments, filed against two Chinese nationalists and a handful of American citizens which are alleged to have conspired with the nationalists, claimed that the nationals operated chemical plants and labs in China and sold fentanyl to United States citizens via the internet. The indictment against one manufacturer further alleged that the chemical structure of the drugs had been modified in order to evade prosecution. If convicted, the nationalists could face prison time and significant monetary penalties.

Democratic lawmakers question move to shut down HealthCare.gov during open enrollment

Rep. Elijah E. Cummings (D-Md), the Ranking Member of the House Committee on Oversight and Government Reform, and Rep. Raja Krishnamoorthi (D-Ill), the Ranking Member of the Subcommittee on Health Care, Benefits, and Administrative Rules, are pressing the Trump Administration on its apparent decision to shut down HealthCare.gov during the upcoming open enrollment season.

Earlier, the Trump Administration announced that it would conduct maintenance outages from midnight to noon Eastern Standard Time on all but one Sunday during the upcoming open enrollment period and that it would shut down HealthCare.gov on Wednesday, November 1, 2017, the first day of open enrollment.

Why wasn’t the work done earlier? On September 29, the Congressmen sent a letter requesting documents and information relating to the decision by the Department of Health and Human Services (HHS) to schedule outages of the website at that particular time. Cummings and Krishnamoorthi pointed out that HHS has had the entire year to conduct routine maintenance without any disruption purchasers of healthcare plans through HealthCare.gov during the open enrollment period. Moreover, this year’s open enrollment period was reduced from 90 days to 45 days. And prior enrollment periods that lasted twice as long reportedly required fewer maintenance outages, according to the lawmakers.

Cumming and Krishnmoorthi also noted that there were earlier reports that the Trump Administration has withdrawn funding for open enrollment advertising and outreach as well as for the ACA’s Navigator program.

After the House of Representatives failed to repeal the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) in March, President Donald Trump argued that “the best thing we can do politically speaking is let Obamacare explode.”

Questions. Cummings and Krishnamoorthi requested documents and communications to address several questions, including:

  • What technical issues warrant shutting down HealthCare.gov during this year’s open enrollment period, and when were they identified?
  • What steps is the HHS taking to ensure that people are fully informed of when these outages will occur?
  • When were you made aware of the days and times for the scheduled website downtime during this year’s open enrollment period?
  • How was the decision made to shut down the website on Sundays from midnight to noon?
  • What alternatives to scheduled outages were considered? What, if any, consideration was given to the website traffic during that period in other time zones?

“Unfortunately,” the lawmakers wrote, “in addition to undermining the ACA, the Trump Administration’s recent actions may harm many Americans who are seeking to obtain health insurance to protect themselves and their families.”

Essential resources for health care providers & attorneys during hurricane season

Hurricane season has arrived and health care providers in affected areas are focusing on providing services to injured individuals and rebuilding damage to facilities, but not necessarily on compliance with Medicare and Medicaid laws and regulations. To assist providers, federal and state agencies are temporarily waiving some regulatory requirements and providing other emergency services. While active hurricane recovery efforts are underway, Health Law Daily will feature links to federal and state resources.

Federal information:

State- and commonwealth-specific information: