New York and Minnesota get millions in additional American Rescue Plan funds

Joseph B. Hash

Photo: Kittiphan Teerawattanakul.EyeEm/Getty Images

The Centers for Medicare and Medicaid Services is providing approximately $750 million in additional funding to New York State and $100 to Minnesota in 2022 to support the Essential Plan and MinnesotaCare, the respective states’  Basic Health Programs. 

Both states will also get added funds for 2020 and 2021. 

The additional funds increase each state’s ability to provide healthcare coverage to low- and-moderate-income individuals who are ineligible for Medicaid or the Children’s Health Insurance Program (CHIP).

One million individuals have been added to coverage in New York and 100,000 in Minnesota, according to CMS.

WHY THIS MATTERS

A revised federal formula made this additional funding possible, CMS said.

The Affordable Care Act gave states the option to establish a Basic Health Program for residents whose income is above levels that would otherwise make them eligible for Medicaid and CHIP. 

Minnesota and New York are the only states currently implementing a BHP, CMS said. The Biden-Harris Administration stands poised to lend expertise to other states considering the program — especially given success across these two states, the agency said. Combined, both states provide coverage to 1.1 million people.

THE LARGER TREND

CMS published the Basic Health Program: Federal Funding Methodology for Program Years 2019 and 2020 in the Federal Register on November 5, 2019. For the program year 2021, the agency published the program methodology  on August 13, 2020.

On March 11, 2021, President Biden signed the American Rescue Plan Act of 2021, containing three provisions that impact state operations and federal payments for a Basic Health Program.

These provisions have an impact on the values of certain factors used within the BHP payment methodologies for  2020 and 2021, with an update on values of these factors.

The U.S. Department of the Treasury reported in September that $700 billion out of total $1 trillion in American Rescue Plan relief funds were disbursed in the first six months since Biden signed the law. This includes more than $450 billion paid directly to families and households, including through more than 170 million economic impact payments totaling over $400 billion, over 106 million Child Tax Credit (CTC) payments totaling more than $46 billion, and over 1 million needing Emergency Rental Assistance totaling more than $5 billion.

Over $240 billion has been sent as fiscal support to state, territorial, local, and Tribal governments to fight the pandemic and accelerate the economic recovery.
 
The U.S. Department of Health and Human Services awarded nearly $1 billion in American Rescue Plan funding to support major healthcare construction and renovation projects at health centers. 

A $178 billion provider relief fund gave Medicare-enrolled hospitals and other providers grants that amounted to at least 2% of their previous annual patient revenue, according to the Kaiser Family Foundation. These grants could be used to cover lost revenue and unreimbursed costs associated with the pandemic.

ON THE RECORD

“Thanks to the American Rescue Plan, we are making increased investments to protect health coverage access for vulnerable New Yorkers,” said Health and Human Services Secretary Xavier Becerra. “New York’s Essential Plan is another strong example of the Biden-Harris Administration working hand-in-hand with states to help more Americans realize the peace of mind that comes with health coverage.”

“The Basic Health Program is an important option for states to provide comprehensive health coverage to low- and moderate-income families,” said CMS Administrator Chiquita Brooks-LaSure. “I’m glad that we can support Minnesota’s successful program as the state ensures that its residents have access to affordable, comprehensive care.”

Twitter: @SusanJMorse
Email the writer: [email protected]

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