News out of D.C. today opens up $4 million hole in health care budget

The feds have dealt a financial setback to the Shumlin administration’s efforts to assist low- and middle-income residents heading into the exchange next year. But Shumlin’s health care chief, Robin Lunge, says the administration is already putting together a “plan b” to deal with the news.

Word came over the phone from Washington, D.C., today that the “cost-sharing assistance” in Shumlin’s fiscal year 2014 budget won’t be eligible for a federal match. That opens up a $4 million hole – a solution to which Commissioner of Vermont Health Access Mark Larson could present to lawmakers as early as tomorrow.

The cost-sharing assistance is essentially an updated version of Catamount Health, tailored to complement the framework of the federally mandated “health benefits exchange.” It would subsidize insurance costs for people making as much as 400 percent of the federal poverty level.

Critics have said the administration’s plan doesn’t go far enough to alleviate the financial burden on the estimated 45,000 poor and working class Vermonters who will be eligible for the aid. But Shumlin’s $22 million proposal considerably reduces the out-of-pocket exposure facing that population.

The $22 million plan, however, will now cost taxpayers $26 million, since the Centers for Medicare and Medicaid Services says it’s not on the hook for the matching funds on which state officials had been counting. Larson is tentatively scheduled to meet with the House Committee on Health Care tomorrow to present a plan to deal with the setback.

Peter Sterling, director of the Vermont Campaign for Health Care Security, said the news could have been far worse. Sterling says the feds have agreed to a federal match for premium assistance in the exchange, something they also could have denied.

 

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