Tina Smith

United States Senator for Minnesota

Klobuchar, Smith Urge Department of Health and Human Services (HHS) to Restore Full Federal Funding for MinnesotaCare

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HHS has agreed to develop a new system for providing federal funding for Basic Health Programs (BHP) like MinnesotaCare; In a letter to HHS and the Centers for Medicare and Medicaid Services (CMS), the senators called for full funding for MinnesotaCare

WASHINGTON- U.S. Senators Amy Klobuchar and Tina Smith strongly urged the Department of Health and Human Services (HHS) to restore the full amount of federal funding that has been cut from MinnesotaCare over the past year. Minnesota, New York, and HHS have recently reached an agreement about a lawsuit regarding cost-sharing reduction (CSR) payments. Under the agreement, HHS will develop a new system for providing federal funding for Basic Health Programs (BHP) like MinnesotaCare. In the letter to HHS Secretary Alex Azar and Centers for Medicare and Medicaid Services (CMS) Administrator Seema Verma, the senators called for full funding for MinnesotaCare.

“According to the Minnesota Department of Human Services, CSR payments have funded approximately 20 percent of the cost of MinnesotaCare before the Administration’s decision to discontinue these payments. As a result, our state may lose approximately $529 million in federal funding between 2018 and 2021,” the senators wrote. “Minnesota has a long, bipartisan history of innovation and efficiency in health care. When creating a new payment methodology for Basic Health Programs, we strongly urge you to restore the full amount of federal funding that has been cut from MinnesotaCare over the past year.”

The full text of the letter can be found below:

Dear Secretary Azar and Administrator Verma,

We write to strongly urge you to develop a Basic Health Program payment methodology that restores the full funding that Minnesota should be receiving from cost-sharing reduction (CSR) payments.

As you know, Minnesota, New York, and the U.S. Department of Health and Human Services (HHS) have reached an agreement to stay ongoing litigation regarding the Administration’s decision to stop making these payments. Under the agreement, HHS has agreed to create a new payment methodology for Basic Health Programs with input from Minnesota and New York. The agreement also calls for HHS to make a payment of approximately $17.2 million to Minnesota while the new methodology is being developed. 

Minnesota’s Basic Health Program, MinnesotaCare, was originally created in 1992 by a Republican Governor and a bipartisan coalition of legislators. It provides health care coverage for low-income Minnesotans who do not qualify for Medicaid. As you know, the Affordable Care Act (ACA) provided states with the option to create Basic Health Programs, under which the state is eligible for 95 percent of the tax credits and CSR payments that would have been provided if beneficiaries had purchased coverage on the exchange. 

According to the Minnesota Department of Human Services, CSR payments have funded approximately 20 percent of the cost of MinnesotaCare before the Administration’s decision to discontinue these payments. As a result, our state may lose approximately $529 million in federal funding between 2018 and 2021. These cuts are compounded by CMS’s decision to cut approximately $277 million in federal funding for MinnesotaCare as part of its approval of our state’s Section 1332 State Innovation Waiver to create a reinsurance program to bring down individual market health insurance rates. As you know, we have repeatedly urged HHS and CMS to maintain Minnesota’s waiver while still receiving full federal funding for MinnesotaCare.

Minnesota has a long, bipartisan history of innovation and efficiency in health care. When creating a new payment methodology for Basic Health Programs, we strongly urge you to restore the full amount of federal funding that has been cut from MinnesotaCare over the past year.

Thank you for your prompt attention to this critically important matter.

Sincerely,

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Issues: 

Washington, D.C. Office

309 Hart Senate Office Building
Washington, DC 20510
Phone: (202) 224-5641
 

State Offices

Moorhead Office
819 Center Avenue
Suite 2A
Moorhead, MN 56560
Phone (218) 284-8721
 

Duluth Office
515 W 1st Street
Suite 104
Duluth, MN 55802
Phone (218) 722-2390
 

State Offices

Saint Paul
60 Plato Blvd. East
Suite 220
Saint Paul, MN 55107
Phone (651) 221-1016
 

Rochester
1202-1/2 7th Street NW
Suite 213
Rochester, MN  55901
Phone (507) 288-2003