Trump releases 2020 budget proposal: 6 things to know

White House
Here's six healthcare takeaways from the Trump administration's 2020 budget plan. (Pixabay)

The White House is calling for a significant cut in funding to the Department of Health and Human Services in 2020, even as it plans to ramp up investments in HIV research, the opioid epidemic and other policy priorities. 

President Donald Trump released (PDF) his “Budget for a Better America” on Monday morning which, among other things, proposes $87.1 billion in funding for HHS, a 12% decrease from 2019.

The budget has been submitted to Congress, which will ultimately decide funding levels for 2020 and is free to craft a budget that differs from the president’s suggestions. The White House budget, however, does offer an opportunity for the administration to lay out key priorities for the year ahead. 

Free Daily Newsletter

Like this story? Subscribe to FierceHealthcare!

The healthcare sector remains in flux as policy, regulation, technology and trends shape the market. FierceHealthcare subscribers rely on our suite of newsletters as their must-read source for the latest news, analysis and data impacting their world. Sign up today to get healthcare news and updates delivered to your inbox and read on the go.

RELATED: Trump calls for funding HIV prevention, childhood cancer research at State of the Union 

HHS Secretary Alex Azar said in a statement that the proposals in the president’s budget “deliver on HHS’ mission and supports the hard work the men and women of HHS are doing to improve the health and well-being of the American people.” 

Here’s a look at some of the key health policy takeaways in the budget proposal: 

A boost in HIV funding 

Trump teased plans to launch a large-scale HIV initiative during his State of the Union address. The budget proposes $291 million for the Ending HIV Epidemic in 2020 alone. 

The goal of the program is to reduce new HIV infections by 75% within the next five years and by 90% in the next decade. Nearly half of this funding ($140 million) is earmarked for the Centers for Disease Control and Prevention to work alongside state and local health departments to tackle this goal. In addition, the plan would put $120 million to the Health Resources and Services Administration to expand treatment access at federal health centers. 

Nationwide Medicaid work requirements? 

The budget calls for Medicaid eligibility for “able-bodied adults” to be tied to employment but leaves such a plan open to interpretation on the best way to do so. Work requirements in Medicaid have been controversial; critics warn that these policies could significantly cut back enrollment. 

RELATED: Voter-backed Medicaid expansion hit snags in 4 states. Where are they now? 

“This would enhance service coordination for program participants, improve the financial well-being of those receiving assistance, and ensure federally funded public assistance programs are reserved for the most vulnerable populations,” according to the proposal. 

CMS has approved work requirements in several states, though so far they’ve only been rolled out fully in Arkansas. In the final four months of 2018, more than 18,000 people lost coverage in Arkansas Medicaid as a result of the requirements. 

Drug prices in Part B, Part D under the microscope

Of course, the Trump administration's laser focus on prescription drug prices is reflected in the budget plan.

The White House proposes building on steps it's already taken by eliminating cost-sharing in Medicare Part D for generics, encouraging beneficiaries to choose low-cost options instead of pricey, brand-name medications. It also suggests an out-of-pocket spending cap in Part D.

The budget also takes aim at the 340B drug discount program, which has been under fire of late as critics say that hospitals in the program are snapping up specialty practices to take advantage of the discounts to line their own pockets. Trump suggested cutting payments to hospitals participating in 340B that offer limited charity care to better reward hospitals that go the extra mile with providing charity care.

In addition, the budget calls for moving coverage of certain drugs from Part B to Part D, which the administration said will lower spending. Recent research has warned, however, that moving certain drugs could boost beneficiaries' cost-sharing.

'Zombie Trumpcare'? More like Zombie Graham-Cassidy ...

Though it was never passed in Congress, the Trump administration is keeping the Graham-Cassidy proposal alive. In the 2020 budget, several health reforms are contingent on a bill modeled after Graham-Cassidy to repeal the Affordable Care Act. 

The budget accounts for a Medicaid block grant and per capita caps beginning in 2021, which it says will improve the long-term sustainability of the program and prevent costs from continuing to rise. 

RELATED: Why providers should be scared that ACA repeal is back on the table 

To address concerns for patients with pre-existing medical conditions, the budget proposal builds a requirement on top of the block grant that would require states to allocate at least 10% to maintain protections for high-cost Medicaid beneficiaries. 

The White House made a similar proposal based on the Graham-Cassidy legislation for its 2019 budget. 

Opioid epidemic stays in the spotlight 

Confronting the opioid addiction crisis has been a key priority for HHS, particularly since Azar took the helm, and the budget seeks to continue that work by putting $1 billion toward NIH for research into pain and opioid use. 

The budget also includes $1.5 billion for state opioid response grants and a $221 million effort to grow the behavioral health workforce. 

The White House also proposes providing nearly $500 million to the CDC to continue research into preventing opioid overdose deaths, and an additional $58 million to research responses to infectious diseases that are spreading as a result of the epidemic, such as hepatitis

“My budget continues historic levels of funding for our law enforcement, prevention, and treatment efforts to combat the opioid and drug addiction epidemic,” Trump said in his introductory letter to Congress. 

Betting big on health savings accounts 

The budget lays out support for several reforms aimed at increasing access to health savings accounts. HSAs are popular with Republicans, and the number of people enrolled in high-deductible plans paired with an HSA is growing

The White House suggested that all plans with an actuarial value of up to 70% of healthcare costs come with an HSA, which includes Medicare plans. “This would enable consumers to utilize the benefits of HSAs with a larger number of innovative plan designs,” the budget suggests.

In addition, to boost “consumer engagement,” the budget calls for people enrolled in subsidized ACA plans to be paying “something” into their healthcare coverage. The budget doesn’t specify how that payment would be structured or if it would be in the form or a premium or in another type of payment.

Suggested Articles

Medicare Part D beneficiaries could see their out-of-pocket costs go up next year before they reach catastrophic coverage, a new analysis shows.

Memorial Sloan Kettering Cancer Center has tapped former CVS Health and Aetna executive Claus Torp Jensen, Ph.D., as its first chief digital officer.

California health officials have released their first report on the price hikes drug companies sought to shield.