The Trump administration has informed government-funded Obamacare outreach groups of deep impending budget cuts next year, with some nonprofits having budgets slashed by as much as 98 percent.
“We’re letting 11 navigators go today, which leaves us with five navigators for the entire state,” says Brian Burton, director of the Southwest Louisiana Area Health Education Center. His funding was cut from a $1.07 million grant this year to $297,000 next year.
The Health and Human Services Department announced August 31 that it would cut funding for the health law’s in-person assistance program by 41 percent. Late Wednesday night, the administration sent each group its individual budget. It shows widespread variation in how big those funding cuts will be.
Louisiana and Indiana, for example, will have the outreach funding coming into their states cut by 80 percent. Maine, however, will have its budget held constant — while Kansas will only see a 9 percent funding cut.
Outreach groups are responding to the cuts by laying off staff and scaling back the geographic areas where they provide assistance.
Covering Wisconsin, the state’s largest enrollment group, is facing a 42 percent budget cut. Its executive director Donna Friedsam announced they would pull out of 12 of the 23 counties where it currently helps low- and middle-income Americans sign up for health coverage.
“The substantial reduction in funding requires [Covering Wisconsin] to determine how to allocate cuts geographically and across the various functions of our organization,” Friedsam said in a statement.
Some Obamacare groups will see their budgets held constant. Others face cuts over 90 percent.
The Obama administration spent $62.5 million in 2016 providing grants to nonprofits and health clinics to help Americans sign up for health coverage. This “navigator” program paid enrollment workers to assist with enrollment and advertise the open enrollment period to their community through things like phone calls and health fairs.
The Trump administration announced on August 31 it would reduce the navigator program’s budget to $36 million. It will focus its budget cuts on the navigator grantees that have fallen short of their enrollment goals. A navigator grantee, for example, who only hit 30 percent of its enrollment goal this year will get just 30 percent of its expected budget for next year (no grantees will be defunded entirely, with a floor of $10,000 for all participants).
Last year’s budget for the navigator program ran out on September 1. This year’s grants were released just before midnight on September 13, meaning that the outreach groups went two weeks with no funding at all. This led to some groups laying off workers or shutting down operations entirely.
Now that the grants have been out for a few days, enrollment groups are figuring out how to manage with the smaller budget.
Louisiana is one of the states experiencing the most drastic budget cuts. Its overall funding for in-person assistance goes to two nonprofits and will fall from $1.47 million this year to $307,349 for next year.
Family Road of Greater Baton Rouge in Louisiana will have its budget reduced 98 percent, the largest reduction in the entire country.
The other enrollment group there, Southwest Louisiana Area Health Education Center, will have its budget decline 72 percent. Burton, its director, has laid off 11 staff members and says they will no longer provide enrollment support in many Louisiana cities, including Shreveport, which has a population of nearly 200,000.
The group will also shutter a program aimed at enrolling the LGBTQ community into coverage.
“It’s going to be tough,” Burton says. “They’ve cut us 72 percent so our outreach will be cut 72 percent. It just means there are less people we’ll be able to help. It will cut down on the travel we can do to rural areas.”
Burton says that many of the people his group worked with were those who had limited internet access and often signed up for an email address just to use the Healthcare.gov website. He’s nervous those people may not get the help they need to sign up in 2018.
Other enrollment groups are still reviewing their options.
“We are disappointed that our budget was cut so substantially, but also relieved that some funding is still available to help Floridians navigate the marketplace,” Karen Basha Egozi, executive director of the Epilepsy Foundation of Florida, said of the 60 percent cut to her group’s Obamacare funding.
Obamacare outreach groups raise questions about methodology for budget cuts
The Trump administration has criticized the enrollment program as “ineffective,” saying it would reduce the budget from those who did not meet their enrollment targets. Despite its multimillion-dollar budget, they estimate it has only signed up 81,426 Obamacare enrollees. The first HHS official cited the case of one Obamacare navigator group that received a $200,000 grant but only signed one person up.
Navigator groups have pushed back on that methodology, arguing that this isn’t a fair measure of the work they do — and that the federal government hasn’t been transparent in how they’ve calculated the new grants.
The groups do assist with in-person enrollment but are also directed to spend their funds increasing public awareness of the Affordable Care Act and helping enrollees use their coverage — find doctors or understand their copays — after they sign up.
“Last year, we fielded nearly 80,000 questions from South Carolinians who needed our help to understand their options to get covered and to stay covered, says Shelli Quenga, director of the Palmetto Project in South Carolina, which will have its budget reduced from $1.09 million to $501,000.
She describes the 54 percent cut as “devastating internally and not a reflection of the quantity or quality of the work that we've provided to the residents of our state.”
Covering Wisconsin, run by Donna Friedsam, is the largest enrollment group in her state. She found out on Wednesday her budget would fall from $998,000 to $576,000, a 42 percent cut.
Friedsam says that Covering Wisconsin has met the enrollment targets it set for this year, and is unclear why she is facing such a steep budget cut.
“I looked back on our documents and we said we were going to do 3,226 direct enrollments in the marketplace plus Medicaid and our total was 3,700,” Friedsam says. “I don’t know what the problem was, or what math they’re using. I just don’t know how they’re deciding this.”
Friedsam was part of a team that won an award under the Obama administration for their success in signing Wisconsinites up for coverage under the health care law. Now she is faced with pulling services out of about half of the counties that Covering Wisconsin currently serves.
“There will not be services in those places unless other resources can be identified to support the navigator program,” Friedsam says. “I’m not aware of how that will happen.”