HHS FY2016 Budget in Brief

Topics on this page: CMS Budget Overview | CMS Programs and Services | Budgetary Request

Centers for Medicare & Medicaid Services (CMS): Overview

Centers for Medicare & Medicaid Services

The Centers for Medicare & Medicaid Services ensures availability of effective, up-to-date health care coverage and promotes quality care for beneficiaries.

CMS Budget Overview

(Dollars in millions)

Current Law  2014 2015 2016 2016
+/- 2015
Medicare /1 511,693 530,451 583,519 +53,068
Medicaid 301,472 328,595 344,447 +15,852
CHIP 9,319 10,608 14,010 +3,402
State Grants and Demonstrations 508 572 593 +21
Private Health Insurance Programs 2,689 15,252 13,254 +11,692
Center for Medicare and Medicaid Innovation 997 1,291 1,590 +299
Total Net Outlays, Current Law 826,678 886,768 957,413 +70,645

 

Adjusted Baseline 2014 2015 2016 2016
+/- 2015
Prevent Reduction in Medicare Physician Payments — 5,337 8,786 +3,449
Total Net Outlays, Adjusted Baseline 826,678 886,768 957,413 +70,645

 

 

Proposed Law  2014 2015 2016 2016
+/- 2015
Medicare — 630 -2,413 -3,043
Medicaid — 4,485 6,617 +2,132
CHIP — — 560 +560
State Grants and Demonstrations — — 25 +25
Private Health Insurance Programs — — — —
Program Management — — 656 +656
Total Proposed Law — 5,115 5,445 +330
Total Net Outlays, Proposed Law /2 826,678 897,221 971,664 +74,423
Savings from Program Integrity Investments /3 — — -870 -870
Total Net Outlays, Proposed Policy 826,678 897,221 970,774 +73,553

 

Table Footnotes

1/ Current law Medicare outlays net of offsetting receipts.

2/ Total net proposed law outlays equal current law outlays plus the impact of proposed legislation and offsetting receipts.

3/ Includes savings not subject to PAYGO from additional program integrity investments above savings already assumed in current law.

CMS Programs and Services

CMS FY 2016 Net Outlays: This pie chart shows the distribution of CMS’s $970.8 Billion in total net outlays for fiscal year 2016 between its various major programs. Medicare accounts for 59.9% of total outlays, and Medicaid accounts for another 36.1% of outlays. Together these two programs account for 96% of CMS’s total spending, with the remaining 4% coming from Private Health Insurance programs (1.3%), CHIP (1.5%), Administration (0.9%), CMS Innovation Center activities (0.2%), and State Grants and Demonstrations (0.1%).

The FY 2016 Budget estimate for the Centers for Medicare & Medicaid Services (CMS) is $970.8 billion in mandatory and discretionary outlays, a net increase of $74 billion above the FY 2015 level.  This request finances Medicare, Medicaid, the Children’s Health Insurance Program (CHIP),  private health insurance programs and oversight, program integrity efforts, and operating costs.  The Budget continues CMS’s work to implement the Affordable Care Act by improving health care for tens of millions of Americans through comprehensive insurance reforms, policies to enhance quality, and providing access to health insurance coverage.  The Budget proposes targeted reforms to improve the long term sustainability of Medicare and Medicaid by increasing the efficiency of health care delivery without compromising the quality of care for the elderly, children, low income families, and people with disabilities.

Budgetary Request

Medicare: The Budget includes net projected Medicare savings of $423 billion over 10 years.  Most notably, the Budget invests $44 billion above the President’s Budget adjusted baseline to reform the Medicare physician payment system to accelerate physician participation in high quality and efficient healthcare delivery systems.  Other proposals improve payment efficiency across providers and increase the value of the care that is provided to Americans.

Medicaid: The Budget includes legislative proposals in Medicaid which have an impact of $3.7 billion on net federal spending over 10 years , including $26.7 billion in Medicaid investments, to make the program more flexible, efficient, and accountable.  The Budget, as part of the Workforce Initiative, extends and refocuses the rate increase for Medicaid primary care providers.  The Budget also extends free preventive care services to all Medicaid beneficiaries, creates a new state plan option to provide continuous Medicaid coverage and limit churning, expands access to home and community-based long-term care services and supports and provides permanent flexibility to facilitate enrollment of children into Medicaid.

CHIP: The Budget extends CHIP funding for four additional years, through 2019, to ensure continued comprehensive and affordable coverage for CHIP children.  The proposal is paid for through an increase in tobacco taxes that will help reduce youth smoking and save lives.  The Budget includes an additional $490 million in CHIP investments to permanently extend express lane eligibility.

Program Integrity: The Budget includes $201 million in new program integrity investments in FY 2016, as part of a multi-year strategy to enable HHS and the Department of Justice to detect, prevent, and prosecute health care fraud.  Additionally, the Budget proposes $25 million in discretionary funding to support program integrity activities in private insurance, including the Health Insurance Marketplaces.  These investments, plus new legislative authorities to strengthen program integrity oversight, yield $21.7 billion in savings over 10 years.

Discretionary Program Management: The Budget for Program Management enables reforms in health care delivery while supporting the ongoing administration of the Medicare, Medicaid, and CHIP programs, as well as the Health Insurance Marketplaces.  The request invests of $36.2 million to address growing Medicare appeals workloads and $50 million for a multiyear process of removing Social Security Numbers from Medicare beneficiary identification cards.

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