What Does a Government Shutdown Mean for Medicaid and CHIP?

[Editor’s Note: If you reached this post while searching for information on how the current partial government shutdown is impacting health coverage, please read this new blog by Andy Schneider.]

Even if you weren’t glued to CSPAN 2 on Friday night, you now know about the federal government shutdown. Many articles have been written about it, covering both the policy differences that led to the shutdown and what the shutdown actually means as a practical matter. This article from Kaiser Health News does a great job of outlining how the shutdown impacts health-related work in the federal government, including the Centers for Disease Control and Prevention, National Institutes of Health, and Medicaid and CHIP.

During shutdowns, federal employees are classified as either “essential” or “nonessential.” “Essential” workers have to continue to work during the shutdown, while “nonessential” workers are furloughed. Both groups go without pay, though typically Congress provides for back pay once the government re-opens. It’s up to the Office of Management and Budget to outline the shutdown plan government-wide, though individual departments are also involved in determining which government functions must continue. The staffing plan for HHS is available here, though some details are still being worked out.

One thing is clear – federal workers tasked with making payments flow will continue to work during the shutdown. States already have their federal Medicaid dollars available to them through March, so Medicaid payments will continue to flow. Readers of SayAhhh! are already very familiar with the shortage of CHIP funding – making managing CHIP in a shutdown more difficult – but whatever limited CHIP funding is available will continue to flow during the shutdown too.

Other parts of Medicaid and CHIP are more likely to be gummed up by the shutdown. About half of HHS employees will be furloughed, so activities like processing Medicaid and CHIP state plan amendments will likely come to a halt. It’s unclear how waiver approvals and processing of public comments will be impacted. But of course many parts of the federal government are already understaffed, making recovering from a shutdown slow and hard. Long to-do lists will just get longer, and a protracted shutdown would have compounding effects.

Kelly Whitener
Kelly Whitener is an Associate Professor of the Practice at the Center for Children and Families