Report: Feds spent $4.4 BILLION on state Obamacare exchanges
Posted By Caroline May On 3:29 PM 11/15/2013
Data compiled and released Friday by the conservative organization Americans for Tax Reform reveals the amount of federal tax dollars funneled to states to implement Obamacare exchanges at $4.4 billion.
According to ATR, the Centers for Medicare and Medicaid Services distributed the funds to states for a variety of “vague” purposes.
ATR pulled out grant purposes such as:
“[P]reparations to demonstrate operational readiness”
“Provide assistance to hire staff and consultants”
“Continue and complete current planning and implementation efforts”
“Secure staff consultants and expert resources and actively engage stakeholders”
“Marketplace IT system design and development costs including IT consultants and privacy and security consultants”
States that did not end up setting up there own Obamacare exchanges also received money, according to ATR’s research.
Alabama for example, received $9,772,451 in two grants in 2010 and 2011 one for planning the exchange and the other to “support core staff, contracts, and activities around early implementation of the Alabama Health Insurance Exchange.”
Many of the states that did end up creating their own exchanges received more money than those that did not.
ATR’s tax policy director Ryan Ellis told The Daily Caller that it was not clear from CMS’ records what ended up happening to the money provided to states to set up exchanges that in the end decided not establish their own exchange.
“Presumably, [the funding] was to try to get those states to change their mind at an earlier stage of development,” Ellis wrote in an email.
In April, The Hill reported that HHS expected to have spent $4.4 billion by the end of the year on grants to state exchanges, more than twice as much as the department expected to spend.
In May, Sally Pipes, Pacific Research Institute CEO, noted at Forbes that “HHS can’t even account for all the grant money it’s throwing at the states, since the money comes with little or no restrictions, guidelines, or accountability.”
A CMS official explained to TheDC that states do have the ability to transition between exchange models with their grants and work with CMS to update the grant for the state’s exchange decision. The official added that if the state does not need the grant any more the state would return it. To date, five states have returned grant funding (Oklahoma, Kansas, Louisiana, Maine, and Wisconsin).
“If a state needs to modify their award, CMS works with them in that modification,” the official wrote in an email. ”The state submits a revised work plan, budget, budget narrative, and project narrative to reflect the new exchange model and timeline that the State is pursuing. CMS will evaluate the scope of each state’s proposed projects to determine the allowability and cost reasonableness of each request. CMS conducts a very careful review of the applicant’s proposal, both through the Office of Grant and Acquisition Management (OGAM) and the Center for Consumer Information and Insurance Oversight (CCIIO), as well as through an internal review by our subject-matter experts. ”
See ATR chart:
State Total Amount
Alaska Did Not Apply
New Hampshire $7,267,088
New Jersey $8,897,316
New Mexico $52,979,483
New York $401,633,975
North Carolina $98,357,315
North Dakota $1,000,000
Rhode Island $134,719,994
South Carolina $1,000,000
South Dakota $6,879,569
West Virginia $20,832,828
Washington, D.C. $133,573,928
Grand Total: $4,419,050,921
*This story has been updated with comment from CMS.