Medicare and Medicaid would not be affected for several months—much longer than any shutdown is expected to last, and healthcare provider groups heavily involved in those programs said they do not fear any impacts in the short term. “It'll be a problem if and when funds stop flowing out, but my understanding is that's not going to be a problem, at least initially,” said Richard Umbdenstock, president and CEO of the American Hospital Association.
Medicare hospital funding would continue unaffected, even in the case of an extended shutdown, according to a CMS official. Similarly, a short-term shutdown would not affect Medicare physician or drug funding. However, if a shutdown lasts longer than the end of May, then the CMS could rely on an emergency fund to pay those costs for another three months.
Medicare contractors that process payments to providers are funded through the regular appropriations process, but they would continue to function over the short term, a CMS official said. However, in the case of a longer-term shutdown, those payment processors “may not” continue to work.
One high-profile healthcare impact of a shutdown during the mid-1990s, when then-President Bill Clinton reached a stalemate with congressional Republicans, definitely will not occur in any current or future shutdowns, HHS officials said. The CMS initially ceased enrolling new Medicare beneficiaries, affecting an estimated 40,000 potential enrollees, before the agency reversed course amid a public uproar. A series of congressional hearings targeted the decision to cease enrollments in spite of the administration's continued authority to enroll beneficiaries.
Similarly, federal Medicaid matching funds for the states would see no effect in the short term, according to another CMS official, because those funds are deposited quarterly.
Among the federal healthcare functions that would cease, the highest-profile affected programs are at the Centers for Disease Control and Prevention. Most of the CDC's functions would continue, but some partnership activities with state and local governments, including chronic disease prevention, would halt.