FY 2018 Budget Released

June 2017 ~

The White House has released its budget proposal for fiscal year (FY) 2018 and presented it to Congress. Totaling at $4.1 trillion, the proposal requests $69 billion in discretionary budget authority and $1,046 billion in mandatory funding to help the Department of Health and Human Services (HHS).

Though the fiscal year 2018 budget proposal contains several healthcare-related provisions, according to a document summarizing the Department of Health and Human Services (HHS) provisions, the FY 2018 budget “does not include any direct Medicare cuts.”

The bulk of the Medicaid savings ($610 billion), under the proposed budget, would come from structural reforms that would allow states to choose between a per capita cap or a block grant beginning in FY 2020. States would be given additional regulatory flexibility to “advance solutions that best serve their unique populations.”

Notable provisions under the FY 2018 budget proposal include:

  • call for the repeal of the Independent Payment Advisory Board (IPAB), established by the Affordable Care Act (ACA) to propose Medicare spending reductions if projected spending growth exceeds a specified economic target;
  • $1.3 billion investment over 10 years to address the Medicare appeals backlog and reform the appeals process;
  • $250 billion in budget savings over 10 years as a result of repealing and replacing the ACA
  • Commitment to funding “necessary activities to continue to operate the Exchanges in 2018;”
  • Reduction to net federal Medicaid spending by $627 billion over 10 years – on top of Medicaid savings included in the Administration’s ACA repeal plan;
  • Funding for the Children’s Health Insurance Program (CHIP) also would cut by $13.9 billion over 10 years;
  • Allow CMS “an increased ability to revisit poor performers, while creating an incentive for facilities to correct deficiencies and ensure quality of care” by implementing a new user fee to fund provider survey and certification revisits as a result of deficiencies found during initial certification, recertification, or substantiated complaints surveys;
  • $5.1 billion in total FY 2017 FDA funding – reflecting a $854 million reduction in budget authority and a $1.3 billion increase in user fees so that such fees fund 100% of costs for premarket review and approval activities in the medical device, animal drug, animal generic, prescription and generic drug, and biosimilar programs;
  • Endorses reforms to “balance the demand for scientific rigor and access to reliable, life-saving cures” and provide “regulatory relief to the industry and speed the development of safe and effective medical products;”
  • An additional $70 million in 2018 to fund the Health Care Fraud and Abuse Control Program;
  • Updates to 340B drug pricing program rules intended to “increase transparency and improve program integrity;”
  • Unspecified medical liability reforms, which the Administration projects would save $31.8 billion over 10 years;
  • A $5.7 billion reduction in National Institutes of Health funding compared to FY 2017 levels and consolidation of the Agency for Healthcare Research and Quality (AHRQ) into NIH.

The proposed FY 2018 budget proposal released on May 23rd, will serve as framework for Congress to review and determine final budget appropriations for the 2018 fiscal year.


Source(s): Medical Group Management Association (MGMA); Health Industry Washington Watch; U.S. Department of Health & Human Services (HHS); Healthcare Information and Management Systems Society (HIMSS); LexologyHealthcare IT News;