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Affordable Care Act Funding: An Analysis of Grant Programs under Health Care Reform – FY2010-FY2015

February 22, 2016

Cover Page ACA-funding2016.FINALAs part of the Patient Protection and Affordable Care Act (ACA), which was signed into law on March 23, 2010, Congress
appropriated funds to expand access to care, implement private insurance reforms, and enhance public health infrastructure.

The ACA provided for both annual appropriations and multiple-year appropriations. Many ACA funds ended in fiscal year (FY) 2014 or FY2015, including all market reform grants. However, several grants were extended for an additional year or more, including many of the maternal and child health programs. The ACA also includes a few permanent appropriations, including the Prevention and Public Health Fund (PPHF) and the Center for Medicare and Medicaid
Innovation (CMMI).

This issue brief updates a previous CHRT brief and examines how ACA grants were awarded to states and local organizations from the shortened FY2010 (March 23, 2010 to September 30, 2010) through the end of FY2015. This brief also contains specific analyses of ACA funding in Michigan.(1)The earlier CHRT brief examined ACA awards from March 23, 2010, through September 30, 2014 (FY2010-FY2014). K. Lausch, J. Fangmeier, M. Udow-Phillips. February 2015. Affordable Care Act Funding: An Analysis of Grant Programs under Health Care Reform – FY2010-FY2014. (Ann Arbor, MI:CHRT).

Spending Provisions

Many ACA initiatives were funded through mandatory spending and do not require further Congressional approval. In total, the ACA included more than $100 billion in mandatory spending over a ten-year period (FY2010-FY2019). This included $65.2 billion to the Children’s Health Insurance Program (CHIP) between FY2014 and FY2017, and $10 billion to extend other funding programs, as required by subsequent legislation.(2)C.S. Redhead. March 6, 2015. Appropriations and Fund Transfers in the Affordable Care Act (ACA) (Washington, D.C.: Congressional Research Service)., (3)The Medicare Access and CHIP Reauthorization Act (MACRA) of 2015 extended funding for CHIP through FY2016 and FY2017, totaling $25 billion over the two years. This is not included in the $100 billion estimated by the Congressional Research Service.

In order to administer new grant programs, the ACA provisions included mandatory funding in several categories:(4)C.S. Redhead. March 6, 2015.

  • Community-based prevention: Includes a series of programs to improve public health infrastructure. The primary source of funding for these programs is the Prevention and Public Health Fund (PPHF).(5)The community-based prevention grant programs included in this report do not capture all PPHF funding uses. PPHF funds have also been integrated into existing programs that do not mention PPHF.
  • Health Centers and the National Health Service Corps: Includes funding for federally qualified health centers (FQHCs), the National Health Service Corps (NHSC), and school-based health centers. Much of these grants focus on providing care in underserved areas.
  • Health workforce: Includes a series of programs to enhance capacity of the primary care workforce.
  • Long-term care: Includes grant programs to support coordinated long-term care services.
  • Market reform: Includes a series of grants that helped states reform their private insurance markets and prepare for the October 2013 launch of health insurance marketplaces (sometimes called exchanges). Grants supported states in establishing online insurance marketplaces, reviewing health insurance premium rates, and providing consumers insurance information. Market reform grants were only appropriated for FY2010-FY2015.
  • Maternal and child health: Includes several grant programs targeted to serve at-risk families and prevent teenage pregnancy.
  • Medicaid & CHIP: Includes grant programs focused on the health of enrollees in Medicaid and the Children’s Health Insurance Program (CHIP).
  • Medicare: Includes a series of programs funded by the ACA to boost the effectiveness and efficiency of Medicare.

    Spending Extensions

Since the ACA’s passage, three major pieces of legislation extended mandatory spending for certain ACA programs.(6)An earlier CHRT brief provided details about legislation that rescinded funding and the effects of budget sequestration on ACA funding. See: J. Fangmeier, P. Eller, M. Udow-Phillips.December 2013. Affordable Care Act Funding: An Analysis of Grant Programs under Health Care Reform – FY2010-FY2013 (Ann Arbor, MI:CHRT). The American Taxpayer Relief Act (ATRA) of 2012 extended funding for Family-to-Family Health Information Centers, and for Outreach and Assistance for Low-Income Programs, including the Area Agency on Aging, State Health Insurance Program, National Center for Benefits and Outreach Enrollment, and Aging Disability Resource Centers. Funding for these programs expired at the end of FY2012 and was extended through FY2013.

The Protecting Access to Medicare Act (PAMA) of 2014 extended several maternal and child health, health workforce, health center, and Medicare programs through FY2014 and FY2015.

The Medicare Access and CHIP Reauthorization Act of 2015 (MACRA), signed into law in April 2015, extended CHIP, the Community Health Center Fund (CHCF) that funds health centers and the National Health Service Corps (NHSC), several maternal and child health programs, and health workforce programs. Funding in these categories was set to expire at the end of FY2015 and was extended through either FY2016 or FY2017. CHIP programs vary from state to state and can operate as an expansion of Medicaid, as a stand-alone program, or a combination of both. Michigan operates as a combination. In January 2016, the CHIP-funded MIChild program became a Medicaid expansion program.(7)Michigan Department of Health and Human Services, Answers to Frequently Asked Questions about MIChild Converting to Medicaid(accessed 12/29/15).

See Appendix A for a list of funding sources for select ACA programs by fiscal year. Select programs include those with permanent funding or funding extensions, and at least one program was included per funding category.

ACA Funding From March 2010 through September 2015

By the end of FY2015, the U.S. Department of Health and Human Services (HHS) had awarded $28.5 billion in grants to agencies and organizations across the United States, including the District of Columbia. The ACA funded a total of 101 grant programs between March 2010 and the end of FY2015.

States with large populations received the most funding, including California and New York, with approximately $3.6 billion and $2.0 billion, respectively. Figure 1 However, similar to CHRT’s analysis of FY2010-FY2014 ACA funding, states that received funding to plan and establish state-based health insurance marketplaces had greater overall funding compared to states that chose federally facilitated marketplaces. For example, Kentucky and Oregon (ranked 26th and 27th in population, respectively) established state-based marketplaces and ranked in the top ten for total funding, with market reform grants totalling $292.1 million and $314.7 million, respectively. In contrast, Georgia and North Carolina, which have federally facilitated marketplaces, have larger populations (ranked 8th and 9th, respectively), but did not rank in the top ten in total funding. Georgia received $3.5 million in total funding and North Carolina received $23.9 million.

The District of Columbia received the most per capita funding overall, averaging $600.13 per person. The District also had the most per capita funding in FY2011 and FY2014, and ranked second and fourth for per capita funding in FY2012 and FY2013, respectively.The District is home to numerous national health care organizations and established a state-based insurance marketplace. See Appendix B for full details of state-level funding.

fig1

The total amount of funding awarded under the ACA has increased every year except from FY2013 to FY2014. Funding
increased by 6.0 percent between FY2013 and FY2015, and 14.2 percent between FY2014 and FY2015. Figure 2 The increase from FY2014 ($6.28 billion) to FY2015 ($7.17 billion) was largely due to an increase in funding for new and expanded services and capital improvements for health centers. Funding in this area increased from $3.3 billion (52.4 percent) of total ACA grant funding in FY2014, to $4.3 billion (60.5 percent) in FY2015. Most of the FY2015 funding in this area supported the Behavioral Health Integration Service Expansion, Health Center Controlled Networks, Health Center Expanded Services, and New Access Points programs ($4.2 billion combined).

Market reform funding has decreased significantly since the launch of the health insurance marketplaces in October 2013. This area of funding fell from $2.2 billion in FY2013 to $679.1 million in FY2014, and to $410.2 million in FY2015. Grant funding for Medicare has also decreased, from $544.4 million in FY2014 to $390 million in FY2015, mainly due to a reduction in Health Care Innovation Awards to test new payment and delivery models.

Between FY2010-FY2015, almost two-thirds of all ACA funding went toward health centers and market reform, $12.5 billion and $5.5 billion, respectively. Community-based prevention and maternal and child health were other prominent categories, with $2.6 billion and $2.4 billion, respectively. Figure 2

fig2

Health and community-based organizations were the leading recipients of ACA funding awards during the FY2010-FY2015 period, with $13.1 billion (46.0 percent) of total awarded funding. Figure 3 The majority of these funds, $10.7 billion, supported new and expanded services and capital development for health centers. The second largest share of funding was awarded to state agencies, with $11.5 billion (40.4 percent) of total funding.

In FY2015, state agencies received $2.1 billion in funding, which was similar to the $2.2 billion they received in FY2014; however, it was a smaller portion of the overall ACA grant funding, at 28.6 percent in FY2015 compared to 34.9 percent in FY2014.

fig3

 

ACA Grant Funding in Michigan

In Michigan, several organizations have been active in applying for and receiving grant funding to implement insurance reforms, improve health care access, and invest in public health infrastructure. Since the ACA became law in March 2010 through the end of the most recent fiscal year in September 2015, Michigan was awarded $708.9 million in funding. The largest category of funding was for health centers ($329.1 million) and the second largest was for community-based prevention ($81.2 million).

Direct funding to the state, including to the Michigan Department of Community Health (now the Michigan Department
of Health and Human Services), accounted for the most funding over this period ($240.5 million); the second highest recipient was Cherry Health, an FQHC. Figure 4

fig4

ACA Grant Funding in Michigan, Fiscal Year 2015

Michigan received $219.6 million in ACA grants in FY2015, ranking ninth among states in total state awards. This was an increase from the $183.9 million Michigan received in FY2014, when Michigan was also ranked ninth among all states. On a per capita basis, however, Michigan ranked 33rd in FY2015. Appendix B

Similar to national trends, Michigan’s largest funded grant category was health center programs, receiving over half of total funding in FY2015. Funding for ACA Medicare programs represented a larger percentage of total awarded funding in Michigan, at 15.1 percent, compared to the average 5.4 percent for Medicare program funding across other states. Figure 5

fig5

Health and community-based organizations were the largest recipient type followed by state agencies in FY2015, receiving $123.2 million and $63.3 million, respectively.(8)In the Tracking Accountability in Government Grants
System (TAGGS), the award recipient Vanguard Health Systems (VHS) of Michigan was categorized as a state agency for FY2015. VHS of Michigan is a private, for-profit health system, thus was re-categorized as a health and community-based organization for this analysis. This aligns with the FY2014 TAGGS designation of VHS of Michigan as a health and community-based organization.
Figure 6 This is similar to FY2014, in which health and community-based organizations received $98.1 million and state agencies received $62.4 million. In FY2015, 43 community health center organizations received awards. Leading recipients included Cherry Health ($9.6 million), Health Delivery, Inc. ($7.5 million), and InterCare Community Health Network ($7.3 million).

fig6

Michigan award highlights in FY2015 included:

  • Health Centers
    • New and Expanded Services: Funding to support new and expanded services at health
      centers grew considerably in FY2015. In Michigan, 41 community health centers were
      awarded funding for a total of $109.3 million.
    • Capital Development: Funding to support capital development also increased, from $1.4
      million in FY2014 to $8.6 million in FY2015. Nine health centers in Michigan received
      awards under this program.
  • Medicare and Medicaid
    • State Innovation Model: The Michigan Department of Community Health (MDCH) was
      awarded $19.5 million to implement and test new delivery models.
    • Integrated Care for those eligible for both Medicare and Medicaid: MDCH received $12.2
      million for demonstration models to integrate care, financing, and/or administration for
      beneficiaries eligible for both Medicare and Medicaid.
  • Community-based Prevention
    • Cancer Prevention and Control Programs: MDCH received $6.9 million to develop comprehensive breast and cervical cancer early detection programs.
    • Preventive Health and Health Services Block Grants (PPHF): MDCH was awarded $6 million in FY2015 to address broad preventive health issues across the state. This is similar to the $6.1 million received in FY2014.
    • State Public Health Actions to Prevent and Control Diabetes, Heart Disease, Obesity and Associated Factors and Promote School Health: MDCH was awarded $4.7 million to implement programs that promote health and prevent and control chronic disease.
    • Primary and Behavioral Health Care Integration: Five community health centers received funding to integrate primary care into community-based behavioral health settings. Community Network Services received $1.6 million and the remaining recipients received
      $400,000 each, for a total of $3.2 million.
  • Health Workforce
    • Teaching Health Centers: Two community health organizations, the Detroit Wayne County Health Authority (now Authority Health) and the Hamilton Community Health Network, received $13.7 million in combined funding ($11.8 million and $1.9 million, respectively) for community-based graduate medical education programs.
  • Maternal and Child Health
    • Early Childhood Home Visitation: Funding for the MDCH’s nurse visitation program decreased from $9.4 million in FY2014 to $3.5 million in FY2015. Since the ACA’s passage, the MDCH has received a total of $36.9 million for the program.
  • Long-Term Care
    • Money Follows the Person (MFT): The MDCH was awarded $7 million to transition Medicaid beneficiaries from nursing homes to community-based care. The MDCH was awarded $12.1 million in FY2014 and $10.1 million in FY2013.

Top 10 recipients of ACA grants in FY2015 were:

  1. State of Michigan $63,261,686 (19 awards)
    • Medicare $24,880,330
    • Community-based Prevention $21,956,121
    • Maternal and Child Health 8,673,300
    • Long-Term Care $7,006,724
    • Health Centers $764,000
  2. Detroit Wayne County Health Authority (Authority Health) $11,796,268 (Health Workforce, 1 award)
  3. Cherry Health $9,550,277 (Health Centers, 2 awards)
  4. Health Delivery, Inc. $7,514,818 (Health Centers, 2 awards)
  5. InterCare Community Health Network $7,259,847 (Health Centers, 1 award)
  6. Hamilton Community Health Network, Inc. $6,604,110 (2 awards)
    • Health Centers $4,719,503
    • Health Workforce $1,884,607
  7. Baldwin Family Health Care, Inc. $5,503,846 (Health Centers, 2 awards)
  8. Alcona Citizens for Health, Inc. $5,053,199 (Health Centers, 2 awards)
  9. Detroit Community Health Connection $4,816,534 (Health Centers, 1 award)
  10. Detroit Healthcare for the Homeless $4,655,664 (Health Centers, 1 award

    Appendix A: Funding of Select ACA Programs, by Year (millions of dollars)

    appA

(9)C.S. Redhead. March 6, 2015.

 

Appendix B: ACA Grant Funding, Total and Per Capita, by State

appB

References   [ + ]

1. The earlier CHRT brief examined ACA awards from March 23, 2010, through September 30, 2014 (FY2010-FY2014). K. Lausch, J. Fangmeier, M. Udow-Phillips. February 2015. Affordable Care Act Funding: An Analysis of Grant Programs under Health Care Reform – FY2010-FY2014. (Ann Arbor, MI:CHRT).
2. C.S. Redhead. March 6, 2015. Appropriations and Fund Transfers in the Affordable Care Act (ACA) (Washington, D.C.: Congressional Research Service).
3. The Medicare Access and CHIP Reauthorization Act (MACRA) of 2015 extended funding for CHIP through FY2016 and FY2017, totaling $25 billion over the two years. This is not included in the $100 billion estimated by the Congressional Research Service.
4, 9. C.S. Redhead. March 6, 2015.
5. The community-based prevention grant programs included in this report do not capture all PPHF funding uses. PPHF funds have also been integrated into existing programs that do not mention PPHF.
6. An earlier CHRT brief provided details about legislation that rescinded funding and the effects of budget sequestration on ACA funding. See: J. Fangmeier, P. Eller, M. Udow-Phillips.December 2013. Affordable Care Act Funding: An Analysis of Grant Programs under Health Care Reform – FY2010-FY2013 (Ann Arbor, MI:CHRT).
7. Michigan Department of Health and Human Services, Answers to Frequently Asked Questions about MIChild Converting to Medicaid(accessed 12/29/15).
8. In the Tracking Accountability in Government Grants
System (TAGGS), the award recipient Vanguard Health Systems (VHS) of Michigan was categorized as a state agency for FY2015. VHS of Michigan is a private, for-profit health system, thus was re-categorized as a health and community-based organization for this analysis. This aligns with the FY2014 TAGGS designation of VHS of Michigan as a health and community-based organization.