Congress Considers $15 Billion Rescissions Package: What You Need to Know

On May 8, the White House released a rescissions package proposing to revoke $15 billion in non-defense discretionary federal spending. This rarely used budget maneuver cancels previously enacted budget authority. If Congress fails to enact its own rescissions bill approving the President's request within 45 days, the President must release the funding, and budget authority will be made available again.

The package largely focuses on recapturing unused funds allocated for Fiscal Year 2017 and will likely pass in the House. The package's outlook in the Senate remains uncertain.

The request proposes the following health care-related cuts:

  • $7 billion from the Children's Health Insurance Program (CHIP)
  • $800 million from the Center for Medicare and Medicaid Innovation
  • $220 million from "Departmental Management" expense fund

With regards to CHIP, $5 billion of those cuts apply to the Children's Health Insurance Fund authorization for Fiscal Year 2017. When Congress authorizes the annual CHIP allotment, they allow room for additional funding in the event that state spending is higher than projected. As a result, billions of dollars in authorized funds may never be spent. In the past, Congress has made bipartisan agreements to transfer these investments toward other programs serving children. The other $2 billion in proposed cuts would come from the Child Enrollment Contingency Fund, which provides payments to states if they experience an unexpected surge in enrollment. The ACC estimates that the rescission of these funds is unlikely to impact states' CHIP programs. Additionally, a report from the Congressional Budget Office estimates that rescinding these unobligated CHIP balances would not affect program outlays or the number of individuals with health insurance coverage. The College will continue to monitor the situation and assess potential impact as developments continue.

Keywords: ACC Advocacy, United States, Humans, Medicaid, Medicare, Financial Management, Investments, Insurance Coverage

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