Madeline Ashley, Kelly Gooch and Alexis – Becker’s Hospital CFO Report
President Joe Biden proposed a $7.3 trillion budget March 11, including various initiatives to lower healthcare costs and an $800 million investment in hospital cybersecurity protection.
16 healthcare takeaways:
1. Medicare. The proposed budget would extend the solvency of the Medicare hospital insurance trust fund indefinitely. The trust fund is projected to run out in 2031. The budget would extend the life of the trust fund via an increase to the Medicare tax rate on Americans making more than $400,000 a year and directing revenue from the Net Investment Income Tax into the trust fund.
President Biden proposed allowing Medicare to negotiate lower prices for drugs — beginning with 10 of the costliest, most widely used drugs used to treat blood clots, cancers, arthritis, diabetes, and other issues. The budget would also limit Medicare Part D cost-sharing for high-value generic drugs, such as those used to treat hypertension and hyperlipidemia, to $2 per month, at most, for Medicare beneficiaries.
2. Medicaid. The proposed budget includes $150 billion over a decade to strengthen and expand Medicaid home and community-based services. Additionally, it makes permanent the expanded premium tax credits that the Inflation Reduction Act extended and provides “Medicaid-like coverage” to individuals in states that have not adopted Medicaid expansion. There are 10 states that have not expanded Medicaid. The proposed budget also prohibits enrollment fees and premiums in the Children’s Health Insurance Program.
3. Opioid overdose epidemic. President Biden requested $1.6 billion in supplemental funding for 2024 in HHS to expand substance use prevention, treatment, harm reduction, and recovery support services to address the opioid overdose crisis.
The proposed budget also boosts funding for the State Opioid Response grant program, and invests in a new technical assistance center to strengthen health providers’ understanding and treatment of women’s mental health and substance use.
4. Maternal health and health equity. The proposed budget includes $376 million to support the ongoing implementation of the White House Blueprint for Addressing the Maternal Health Crisis to reduce maternal mortality and morbidity rates, and address the highest rates of perinatal health disparities. This is an increase of $82 million above the 2023 enacted level. The proposed budget also expands Medicaid maternal health support services during the pregnancy and postpartum period by incentivizing states to reimburse doulas, community health workers, peer support initiatives, and nurse home visiting programs, among other providers, and requires all states to provide continuous Medicaid coverage for 12 months postpartum. More than 40 states have already extended postpartum coverage.
5. Telehealth internet access. Noting how crucial the internet is for Americans needing healthcare access through services like telehealth, the budget builds on the $2 billion for USDA broadband programs and provides $122 million for the ReConnect program, which gives loans and grants for broadband access in underserved areas, like tribal areas.
The budget also includes a supplemental request of $6 billion for the Affordable Connectivity Program to continue into 2024, with the administration working with congress to secure 2025 and beyond additional funding. It includes the allowance of banning unwarranted telehealth and certain outpatient commercial insurance service “facility fees”.
6. Cybersecurity: The budget notes that from 2018 to 2022, there was a 95% increase in large data breaches reported to HHS. It provides $800 million to help “high need, low-resourced” hospitals cover costs associated with implementation of HHS cybersecurity practices, along with $500 million for an incentive program to “encourage all hospitals to invest in advanced cybersecurity practices.” It also sets aside $141 million to bolster protection of HHS’ systems and information.
7. Supply chain: The budget zeroes in on the domestic medical supply chain, investing $75 million in the Administration for Strategic Preparedness and Response to manufacture more “essential medicines, medical countermeasures and critical inputs in the United States.” It also sets aside $12 million to strengthen the FDA’s capacity to identify and address potential disruptions and shortage threats, and installs a new office to coordinate HHS’ supply chain efforts for drugs, biologics, medical devices and critical foods.
8. Reproduction and women’s health. The budget provides $594 million, up $37 million from 2023, for the U.S. Agency for International Development-directed high-impact and lifesaving voluntary family planning and reproductive health programs and America’s voluntary contribution to the United Nations Population Fund.
The Biden administration also proposed the transformation of government funding at the National Institutes of Health for women’s health research through developing new excellence and innovation in women’s health centers nationwide. The budget would double the existing Office of Research on Women’s Health at NIH funding. It also sets aside funding for expansion in paid family and medical leave programs through the Social Security Administration for up to 12 weeks of leave for circumstances like bonding with a new child, finding safety from domestic violence, dating violence, sexual assault, or stalking.
9. Cancer moonshot: President Biden proposes an increase of more than $2 billion for agencies supporting his “Cancer Moonshot” goal, which aims to reduce the cancer death rate by at least 50% over the next 25 years. The budget requests that the funding be distributed across the National Cancer Institute, FDA, CDC and Advanced Research Projects Agency for Health. It also institutes additional mandatory funds for the Indian Health Service beginning in 2026.
10. Public health infrastructure: To improve the country’s ability to respond to emerging health threats, the budget sets aside $9.8 billion for the Prevention and Public Health Fund — an increase of $499 million from the 2023 enacted level. It also asks for $20 billion in mandatory funding for HHS public health agencies to support biodefense.
11. Gun violence: Over the next decade, President Biden’s budget invests $2.5 billion in the CDC to support an “evidence-based community violence initiative,” which aims to address causes of violence in communities and reduce related health inequities. It also requests $60 million for gun violence research between the CDC and NIH.
12. Mental health access. The budget features an array of mental health investments, including a combined $216 million in mental health programs for students. It also invests money in suicide prevention and brings an additional $50 million to the children’s mental health initiative. The budget features $1 billion for behavioral health providers to advance technology adoption and engagement. It sets money aside for primary care and mental healthcare services in rural areas as well.
13. Organ donation: The budget includes funding for the Securing the U.S. Organ Procurement and Transplantation Network Act, signed into law in 2023, which aims to modernize the organ transplant system and increase access to donor organs. It requests funds to make the system more “agile, user friendly, accountable, and equitable,” and to facilitate and encourage transfers for Medicare beneficiaries by expanding support for living donors.
14. Disease treatment and prevention. The budget allots funding for infectious disease treatment and prevention including HIV, vaccine-preventable disease, and hepatitis C. It proposes a national program expansion of testing, screening, prevention, treating, and monitoring hepatitis C infections, with a focus on high infection level populations. The budget proposes a new vaccines for adults program and expansion of vaccines for children program.
15. IHS and rural healthcare: The budget requests $8 billion in discretionary funding for the Indian Health Service — a 12% increase from the 2021 enacted level — to cover clinicals services, preventative health, facilities construction, contract support costs and tribal leases. It also proposes that all resources become mandatory in 2026, and requests that the Special Diabetes Program for Indians is reauthorized and receives increased funding.
In addition, the budget notes that more than 60 million Americans live in rural areas, and invests in additional assistance for rural hospitals: including direct primary care and mental healthcare services.
16. Veterans’ healthcare: Through 2025, President Biden requests $24.5 billion for the Cost of War Toxic Exposures Fund, which covers healthcare and benefits delivery for veterans exposed to certain environmental hazards. The ask is $19.5 billion above the 2023 enacted level.
The budget also provides a total of $134 billion in VA medical care for 2025, including a $2 billion investment for non-recurring maintenance to improve medical facility infrastructure.
