President Biden’s proposed fiscal year 2024 budget for the HHS targets healthcare access for underserved populations and aims to make premium Affordable Care Act subsidies permanent.
Released Thursday, the budget also proposes to extend Medicare solvency and give the federal government more power to negotiate prescription drug prices. It allocates $144.3 billion in discretionary funding to the agency, up from $127.3 billion in 2023, and aims to reduce the federal deficit by nearly $3 trillion over the next decade.
The HHS proposes to allocate $183 billion over the next 10 years to make enhanced tax credits, enacted originally under the American Rescue Plan and extended into 2025 by the Inflation Reduction Act, permanent.
With the subsidies, enrollment in Marketplace plans soared during the coronavirus pandemic, contributing to a record-low rate of uninsured Americans and a record-high number of ACA plan enrollees. Last month, the CMS announced a record 16.3 million people had signed up during the 2023 open enrollment session.
Millions of Americans were expected to experience a hike in health insurance premiums at the end of 2022, before the IRA proposed an extension.
In addition to the subsidies, the proposed budget also provides “Medicaid-like coverage” to those in states that have not adopted Medicaid expansion and incentivizes states to maintain coverage if they have existing expansions.
The proposed budget also shines a light on Medicare solvency and aims to expand the solvency of the Medicare Hospital Insurance Trust Fund by 25 years. The budget pushes for solvency by closing tax loopholes that allow wealthy people to avoid paying investment tax through passthrough business, and increases the tax by 1.2% for households earning above $400,000.
The trust fund, which covers inpatient hospital care for the more than 67 million Americans enrolled in Medicare, is expected to run out in 2028 without federal action.
Medicare will have the power to negotiate prices for more drugs in the proposed budget, and the requirement that pharmaceutical companies must pay rebates to Medicare if drug price increases outpace inflation is extended to commercial health insurance.
The proposal also aims to cap insulin cost-sharing at $35 per month.
“We want to keep working with Congress to go even further so that we can reduce costs,” CMS Administrator Chiquita Brooks-LaSure said on a call with reporters.
In addition to Medicare solvency, the HHS budget targets care access for underserved communities, aiming to double Health Center Program funding over the next five years and providing $7.1 billion for the centers next year.
Health Centers, which are overseen by the Health Resources and Services Administration, provide healthcare for vulnerable communities including low-income people, rural patients and people experiencing homelessness.
Mental healthcare was also prioritized in the budget, with the HHS proposing to dedicate $836 million to the 988 phone number and Behavioral Health Services program.