President Biden unveiled his budget proposal for FY 2023

President Biden unveiled his budget proposal for FY 2023

The President’s FY 2023 Budget would Invest in Pandemic Preparedness and Mental Health. President Biden released his FY 2023 budget request on March 28. The budget proposes $5.8 trillion in mandatory and discretionary, and includes an increase of approximately 27% for the Department of Health and Human Services (HHS) budget seeing.

The budget highlights key policy priorities and funding goals for the Administration but is largely aspirational as it is Congress, not the Administration that controls the budgeting process. With Democrats in charge of the House and Senate, it is likely that some of the President’s priorities will be reflected in the legislative budget process.

The President requested $81.7 billion over five years to boost COVID-19 response and future pandemic preparedness, $20.8 billion in discretionary funding for behavioral health efforts, and funding to drive health equity initiatives across agencies. Additionally, the HHS budgetary request emphasizes mental health and health equity across the agency, key measures to note include a request for $697 million to invest in the new 988 Nationwide Mental Health Crisis and Suicide Prevention number, set to launch this summer; $3.5 billion to improve Medicare mental health coverage; and $10.4 billion to address the opioid epidemic. The President also continues to push two signature programs, requesting $5 billion for the Advanced Research Projects Agency for Health (ARPA-H) and $92 million for the Cancer Moonshot Initiative.

Healthcare providers’ push for additional financial support for the Provider Relief Fund was not addressed. To address some of the concerns with Medicare reimbursement under the physician fee schedule, the budget includes a proposal for CMS to increase the conversion factor with an inflationary update one year earlier than currently allowed (2025 v 2026) so that Advanced APM participants would receive 0.75 % update and non-participants a 0.25% update. It does this instead of extending the APM 5% bonus, a proposal that many in the ACO community have been urging.

The President’s budget request comes quickly on the heels of the FY2022 Omnibus Appropriations bill, just signed into weeks before. Hearings on the President’s Budget will be ongoing in congressional committees over the next couple of weeks. And, the House and Senate Appropriations Committees have begun work on the FY2023 budget, which will continue through at least the next few months.

HHS announces Home and Community Based Services (HCBS) Funding: On March 31, HHS announced $110 million in additional funding for 20 states not yet participating in the Money Follows the Person (MFP) program. These funds support people who choose to transition out of institutions and back to their homes and communities. States not yet participating will be eligible for up to $5 million in planning grants to join the program. For states already participating in MFP, CMS also announced that the agency is increasing the reimbursement rate for MFP “supplemental services.” These services will now be 100% federally funded with no state share. Further, CMS is expanding the definition of supplemental services to include additional services that can support an individual’s transition from an institution to the community, including short-term housing and food assistance.

COVID.GOV Launches: The Biden Administration on March 30 launched a new website to help the public locate vaccines, tests, treatments and masks, and have access to the latest COVID-19 updates. It also includes a locator for the new Test-to-Treat program that allows people to get tested and receive appropriate treatment, if needed, at that same location. An Administration fact sheet further describes the new site.

IRF Proposed Rule Released. On March 31, CMS released the Fiscal Year (FY) 2023 Inpatient Rehabilitation Facility (IRF) Prospective Payment System (PPS) proposed rule (a Fact Sheet is also available here). In all, CMS estimates that the rule will increase IRF payments in FY 2023 by 2.0% relative to FY 2022. With respect to the IRF Quality Reporting Program, CMS does not propose any new measures for implementation in FY 2023. However, and as anticipated , CMS is maintaining its effective date of October 1, 2022, for the new more detailed patient assessment data collected for each IRF discharge—known as the IRF Patient Assessment Instrument or IRF-PAI version 4.0. The rule also continued to request input on how to address health equity by seeking additional feedback from stakeholders.

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