New York and Minnesota, the only two states to establish Basic Health Programs (BHPs) under the Affordable Care Act (ACA), will now receive promised federal funding after suing the Trump administration.

cms-to-pay-two-states-for-health-expensesBasic Health Programs are state-operated insurance providers for residents¬†earning between 138 percent and 200 percent of the federal poverty level — the population earning slightly too much to be eligible for Medicaid.

Under terms of section 1331 of the ACA, the federal government is on the hook for funding basically 95 percent of these programs, based on a formula combining subsidies the insured would have received as well as the Cost-Sharing Reduction (CSR) funds that would have gone to an insurance company.

The Trump administration, however, ended CSRs in 2017, putting a huge hole in funding for the two states’ Basic Health Programs. Thus they sued earlier this year, and Trump officials agreed to settle.

This past Friday (Aug. 24), the Centers for Medicare and Medicaid Services (CMS) issued a Final Administrative Order (which it clearly stated was for 2018 only) awarding New York some $422 million and Minnesota $46 million. These funds will be in addition to earlier payments of $151 million to New York and $17 million to Minnesota.