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Cyber Executive Order Impacts Private Infrastructure and Network Protection

After months of speculation the White House has released its much-anticipated Executive Order (EO) pursuing comprehensive cybersecurity protection of public & private critical infrastructure. The timing of the EO coincides with the President’s State of the Union Address and as the House Intelligence Committee reintroduces the Cyber Intelligence Sharing and Protection Act (CISPA) that passed the House during the last Congress but died without an up-or-down vote in the Senate.
 
The Executive Order on Improving Critical Infrastructure Cybersecurity centers its efforts to strengthen cybersecurity critical infrastructure protection (CIP) through increased information sharing among industry and government and through standardized cybersecurity practices applicable across public and private infrastructures. Significant aspects include:
  • Threat Information Sharing – The EO expands the sharing of both classified and unclassified cyber threat and attack information to companies by requiring federal agencies to produce and quickly share unclassified reports of threats to U.S. companies. The directive also expands the Defense Industrial Base (DIB) Enhanced Cybersecurity Services (DECS) program to stimulate near-real-time sharing of cyber threat information with participating critical infrastructure companies. 
     
  • Cybersecurity Framework – The Order gives the National Institute of Standards and Technology (NIST) the lead role in developing a Cybersecurity Framework of practices to reduce cybersecurity risks to critical infrastructure. This construct is to be built in collaboration with industry, leveraging existing and proven international standards, practices, and procedures. Further, the Framework is to be technology neutral to allow for innovation and competition among cyber products and services. The Department of Homeland Security (DHS) will promote the implementation of this Framework by industry through various sector-specific agencies like the Department of Energy and others.
     
  • Privacy Protections –The mandate requires federal agencies to incorporate privacy and civil liberties safeguards into their activities, based upon the Fair Information Practice Principles (FIPPS) and other applicable privacy and civil liberties standards. Agencies are also required to conduct regular assessments of the privacy and civil liberties impacts of their activities and make these findings available to the public. 
     
  • Cybersecurity Regulation – The EO requires regulatory agencies to review existing cybersecurity regulations in light of the new Cybersecurity Framework to determine if current regulations are effective and sufficient, if any should be eliminated, or if new regulations are needed. Agencies will propose new, cost-effective regulations based upon the Framework to shore up existing regulations deemed ineffective or insufficient.
Implications
 
The White House considers this EO to be “a down-payment on expected further legislative action,” recognizing that certain executive actions require Congress to legislate such authorities. While we watch for those developments we can anticipate some potential implications for companies offering cybersecurity and other applicable solutions. 
 
The broadened threat information sharing provision opens up participation in the DECS program which, according to media reports, has shown signs of languishing in recent months, while its parent program – the DIB Cyber Security / Information Assurance (DIB CS/IA) Program has grown. Depending on how things progress, this EO may breathe some new life into these programs and work toward broadening the sharing of threat information. A key element here is any costs incurred with the program. This EO provision comes on the heels of January’s 2013 National Defense Authorization Act which included several cybersecurity provisions, including requiring DoD contractors to report penetrations to their networks.
 
The new NIST-led Cybersecurity Framework development will present opportunities for industry to engage with policymakers and influence the future cyber policy. While the resulting Framework is intended to be technology-neutral, the ability to influence what elements constitute “secure” may drive future demand for certain technologies and services. Further, active engagement may place a firm’s solutions in the front of the mind of agency decision makers, producing a residual benefit.
 
The FIPPS privacy requirement may open doors for advisory services and training on FIPPS-related activities and assessments. As new regulations are developed agencies and industry will need help addressing new requirements and applying new approaches and technologies.  

In the end, the new EO reignites the policy and legislative debate on federal cybersecurity as well as asserts broader federal influence over private critical infrastructure and networks.

 
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New presidential directive is more "cyber" aware, but its state and local impact is doubtful

On the eve of his State of the Union address, President Obama ushered in a major overhaul of U.S. homeland security policy with Presidential Policy Directive/PPD-21. Much of the news coverage this week referred to the directive as some sort of “cyber” policy. To that end, PPD-21 “identifies energy and communications systems as uniquely critical due to the enabling functions they provide across all critical infrastructure sectors.” However, while PPD-21 is not solely focused on information, or “cyber,” security [See Deltek's latest report on this market], awareness of “cyber threats, vulnerabilities, and consequences” is significantly higher in this directive than in HSPD-7.

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General government state and local ballot initiatives: lotteries, gaming and other news

While media outlets nationwide concentrate heavily on how Tuesday’s election results will affect federal
government spending, contracting and state and local funding, I would like to shine a light on a series of state and local ballot measures that will certainly fly under the radar in the wake of President Obama’s reelection, but may nevertheless have major impact on business, procurement and IT needs. Here’s a breakdown of several measures that are sure to affect state and local lottery and gaming operations, as well as procurement law:
 
LOTTERY AND GAMING
 
Maryland:
-       Voters statewide weighed in on Question 7, the much-talked about gaming expansion ballot initiative to allow the construction of a casino in Prince George’s County. Public officials argued that tax revenues from the casino would go toward education funding. The measure was vociferously opposed (mainly by a rival casino operator in West Virginia), and led to the most expensive political campaign in Maryland’s history, with more than $90 million spent between supporters and opponents. Despite the opposition, the measure passed by a 52 percent to 48 percent margin.
 
Oregon:
-       Oregon had two proposed amendments to the state constitution that would have legalized privately owned casinos with gambling, and used the tax revenue for various budget purposes. Both measures were defeated.
 
Rhode Island:
-       Rhode Island approved a measure to allow state-operated casino gambling at the Twin River Casino in Lincoln, R.I. Another measure to allow state-operated casinos in Newport received support from statewide voters (67 percent), but failed to pass because the measure had to be approved by a majority of Newport voters. As with all new state-operated gambling venues, there will likely be substantial opportunities for vendors who provide video lottery terminals, gaming systems and other forms of electronic gambling.
 
Florida:
-       Lee County sought to allow slot machine gaming at the Naples-Fort Myers Greyhound track. Voters approved the measure, though it remains subject to authorization by the state legislature. The approval of these machines is expected to lay the groundwork for future lottery and gaming expansions in the state.
-       Volusia County also proposed installing slot machines at designated locations throughout the county. Results for this measure are not available at this time.
 
Illinois:
-       Wood Dale City and Winfield Village both put initiatives on the DuPage County ballot to prohibit video gambling. Wood Dale voted in favor of prohibition, as did Winfield Village.
 
New York:
-       The city of Geneseo voted on whether to allow video gaming. According to the Star Courier, the measure was barely defeated with a 17-vote margin of 1,730 to 1,713.
 
ODDS AND ENDS:
 
California:
-       The cities of Newport Beach and Murrieta placed a pair of initiatives on the ballot to ban the use of red-light cameras. Red-light and speed cameras are produced almost exclusively by the private sector, and cities frequently contract these services out. Murrieta voters approved Measure N to ban the use of such cameras, as did Newport Beach. A fun fact I learned while writing a paper on red-light cameras for my public policy graduate school program: Since 1990, every time the use of red-light or speed cameras has been put to a referendum, the public has overwhelmingly voted to prohibit their use.
-       The city of Santa Rosa voted on a measure to alter the city’s charter to allow the city to contract with a single vendor to provide both design and build services for projects. Previously, the charter required the city to solicit services separately. Though results aren’t final at this time, the Santa Rosa Press Democrat is reporting that the measure is likely to pass (68.4 percent to 31.6 percent).
 
Alabama:
-       A measure to amend the Alabama State Constitution to allow the issuance of general obligation bonds of up to $750 million with the goal of providing financial incentives to existing companies within the state as well as attracting new industry passed with a 69.3 percent to 30.66 percent margin.
 
Florida:
-       The town of Redington placed a measure on the Pinellas County ballot proposing alterations to the town charter codifying a requirement that bidding and purchases be done through a competitive bidding process “whenever practical.” Results are not available at this time.
 
Analyst’s Take
 
As for the large swatch of lottery and gambling initiatives, with the exception of Rhode Island and a few other governments, most of the measures were to legalize privately owned and operated gambling establishments, not state-run facilities with concrete contracting possibilities. Still, for many states, the first step toward state-run gambling is permitting the practice in the private sector. While this may not lead to business opportunities in the immediate future, keep an eye on the state and local governments that passed gambling referendums. Chances are that three to five years down the road, a lot of these governments will be looking to get into the lottery and gaming business as well.

 

Anti-Affordable Care Act initiatives pass in wake of Obama victory

As the dust settles from the two-year-long presidential campaign, and life begins to return to normal in swing states, voters in four states registered their continued disapproval of various provisions of the Affordable Care Act (ACA).
 
In a move that harkens back to pre-Civil War states’ rights advocates, voters in Alabama, Wyoming and Montana overwhelmingly approved ballot measures that seek to nullify the ACA’s most controversial provision: the individual mandate. In Alabama and Wyoming, the question was on amending the state constitution to prevent individuals from being compelled to participate in a health care system, and preserve individual rights in making health care choices, respectively. Montanans approved a measure with similar language that did not amend the state constitution.
 
Missouri, which had previously passed an anti-individual mandate ballot initiative, voted to prohibit the establishment, creation or operation of a health insurance exchange (HIX). State legislative Republicans proposed the initiative to prevent Democratic Governor Jay Nixon from establishing an exchange by executive order. This, however, will not prevent the federal government from running Missouri’s HIX when the state fails to meet the ACA’s deadlines.
Finally, the voters of Florida, which has not been officially called as voting for Governor Romney or President Obama, narrowly rejected a constitutional amendment prohibiting the individual mandate.
 
Each of these ballot measures, with the exception of the Missouri initiative, are widely agreed to be symbolic. States cannot nullify a duly-passed and constitutional law. Though many believed the Civil War had settled this issue, the ballot initiatives prove that a wide majority of voters in the states mentioned disagree. Interestingly, in each of the states (Missouri, Alabama, Wyoming and Montana), the ballot questions were agreed to by a larger margin than Governor Romney carried each state. This means that President Obama voters, ostensibly Democrats, switched their vote to approve measures that oppose the president’s signature achievement.

The waiting game is over: States must act on Obamacare

“The law is the law, whether you like it or not. It doesn’t matter if you like it. It’s the damn law.” 

Many governors and insurance department heads awoke this morning with Mississippi Insurance Commissioner Mike Chaney’s words ringing true after last night’s reelection of President Obama. States holding out for a change in federal leadership on health reform now have fast decisions to make. The numbers are staggering for Mississippi: one in five people lack health insurance; it leads the “States of Misery” in health, poverty, and crime statistics; and has the highest level of obesity in the country at 34.9 percent. Despite Governor Phil Bryant calling for a stall on Obamacare, Chaney is creating a health insurance exchange (HIX) under his own authority, and with an Obama victory, plans to file a blueprint on November 16, unless he receives a court order from “some idiot out there trying to stop me.” Though his words could be considered somewhat crude, the logic behind them is solid: State’s ignoring the law does not mean the law disappears, and these words come from someone against Obamacare.

 

Exit polls from last night showed that roughly a third of voters listed health care as an important factor in their vote. Despite Obama being reelected, several states had voter efforts approved to limit Obamacare, including Missouri, Alabama, Wyoming, Florida, and Montana. Although some states were opposed to health care reform from the beginning, those that started the exchange planning process are finding that they have run out of time, and will likely adopt the federal exchange until a state-based exchange can be built.

 

With a scramble to hit the 2014 deadline, procurement strategies may be expedited, like Connecticut’s sole-source award to Deloitte for both its HIX and its integrated eligibility system. Expect to see even the early innovators relying heavily on federal hub resources for the first enrollment period. As Chaney pointed out, there is no more waiting; the Affordable Care Act is the law. Deltek will be watching as blueprints are submitted to the Center for Consumer Information and Insurance Oversight by November 16, 2012, and how federal-state relationships play out as the nation addresses health care reform.

 

As always, be sure to follow Deltek’s Health Care and Social Services Team on Twitter @GovWin_HHS, or connect with us through LinkedIN. Stay tuned for more information around a new Health Insurance Exchange Vertical Profile addition in the near future!

 

 

Vendors Should Game Out Potential Sequestration Impacts

Deltek has already discussed the likely impacts of federal budget sequestration on Justice and Public Safety programs here. Sequestration arises from the Budget Control Act of 2011, which established new budget enforcement mechanisms for reducing the federal deficit by at least $2.1 trillion over the 10-year period (FFY 2012-FFY 2021).
Vendors should expect state and local buyers to remain fairly uncertain—maybe even confused—about the potential impact of sequestration on their federally funded grant projects. Many agencies will not implement contingency plans for sequestration cuts. They will wait for sequestration to go into effect and let their state budget offices to sound the alarm and issue orders. So, vendors with projects funded by federal grant dollars should think ahead.
The National Association of State Budget Officers (NASBO) has reviewed the federal government’s most recent sequestration report and found that “the report has certain limitations – for example, its calculations are based on fiscal 2012 appropriated levels rather than fiscal 2013, and its organization by federal account rather than grant program may make it less easy for some state agencies to analyze.”
Federal Funds Information for States (FFIS), the leading analyst of federal aid to states and localities, has found that:
While 73% of the programs that FFIS tracks are covered by the sequester, most of the funding states receive via federal grants (82%) would be exempt from sequester. This is because Medicaid (which accounts for almost half of federal aid to states), several highway programs, and a host of other mandatory programs targeting low-income individuals are not subject to sequester.
However, vendors should keep in mind that grant funds underwriting special IT projects that are unrelated to long-established programs are more likely to be in that 18% of non-exempt funding. For example, the Centers for Medicare and Medicaid Services’ (CMS) funding for “State Grants and Demonstrations” is sequestrable. This means that this pot of $530 million (per FFY 2012 budget) would be subject to a 7.6% cut (or $40 million) over the sequestration period. Unfortunately, as NASBO has pointed out above, the White House report on the impact BCA does not provide the level of detail required to assess the impact of sequestration on specific grant awards.
In reviewing relevant federal documents, Deltek does find any indication that federal funding participation (FFP) on IT projects for means-tested benefit programs, such as Medicaid Management Information Systems (MMIS), would be affected by sequestration. This is in keeping with the fact that programs for low-income individuals are exempt from BCA cuts, but we will keep an eye on this. The BCA, which is due to go into effect on January 2, 2013, will immediately become a political hot potato after the November election.
For the time being, all IT vendors doing business with state and local government projects funded by federal grants (not FFP) unrelated to programs for low-income individuals would be well advised to have a contingency plan for sequestration reductions.  It will be a good exercise for the continuing budget battles that are likely to afflict Washington for the next four years, regardless of the November results.

Government 2.0: Government Trends - IT procurement transformation (Part 2)

Continuing from my previous blog on Government  2.0’s effect on the traditional IT procurement process, I wanted to take a look at trends in government’s approach to acquiring Gov 2.0 technology. Part 1 of this blog series highlighted how small Gov 2.0 IT firms have begun to use non-traditional purchasing options to circumvent the traditional procurement process. Gov 2.0 firms are trying to avoid the procurement process because it has historically been more difficult for small IT firms to compete in the government IT market. However, today’s trends in IT procurement hint that times are changing. Since governments continue to face shrinking IT budgets against expanding IT costs and needs, they are now looking for alternative ways to do business as well. For many IT bureaucrats and contracting officers interested in Gov 2.0 technology, that means looking outside of the conventional procurement process, and toward smaller IT firms.

 

Code for America (CFA), an example of Gov 2.0 realized, is an organization that describes itself as “Peace Corps for geeks.” Established in 2009, CFA assigns programmers on year-long fellowships to work with local governments on in-house IT projects, to provide faster and more affordable alternatives to procuring vendor services and solutions. CFA noticed that new IT products, which it calls “civic startups,” were often created once the fellows had completed their assignments – essentially spawning new businesses. However, these civic startups that had created products for governments were having trouble selling their products. Finding the government procurement process difficult to navigate, many fizzled.

 

In response to this issue, CFA is setting up its first civic incubator, where a handful of IT entrepreneurs will participate in a five to six-month-long program that will provide funding and mentoring, while bringing their applications and solutions directly to local governments and school districts. This incubator is something CFA’s leadership hopes will turn the traditional procurement process on its head.

 

Another noticeable trend on the rise is localities across the country sponsoring crowdsourcing events and hackathon competitions as an alternative approach to the traditional solicitation processes for Web development solutions and services. In 2010, after working with CFA, the city of Boston took a one-day hackathon event to the next level by creating a permanent office within local government. The New Urban Mechanics Office was created to hire full-time programmers for in-house IT development projects as well as to conduct outreach to encourage, field, and partner with small IT entrepreneurs.

 

In another CFA spinoff, White House Chief Technology Officer Todd Park created the Presidential Innovation Fellows (PIF) program to  pair “top innovators from the private sector, non-profits, and academia with top innovators in government to collaborate on solutions” using technology. On August 23, 18 innovators from outside of government were selected to work on one of five projects over the course of six months. The PIF program’s goal is to synthesize open data, expand e-government services, and simplify the RFP process by “building a platform that makes it easier for small high-growth businesses to navigate the federal government, and enable agencies to quickly source low-cost, high-impact information technology solutions.” 

 

One of the five projects, RFP-EZ, was born after Sean Green, head of the Small Business Administration’s Investment and Innovation Program, remembered an instance with the Department of Health and Human Services (HHS). The department had a need for an IT project, but the project’s estimated cost was $5 million to implement by a traditional IT vendor. After some research and outreach, HHS partnered with smaller IT companies that were able to complete the project for just more than $400,000.

 

During the PIF announcement, Green gave an open call to developers, contracting officers, and small Web development firms to join the effort and participate through Github.com, which is an open platform where RFP-EZ will be demoed. If successful, many state and local level governments will likely partner with or imitate the RFP-EZ project. Park took to Twitter after the announcement to confirm that the PIF will also be working with both state and local governments, in addition to the federal government, to create these IT solutions.

  

Analyst's Take

 

At all levels of government, innovation and affordability have been contradictory terms. The Code for America debunked the idea that quality Gov 2.0 solutions and services had to come at a premium. CFA seems to have been the catalyst for the future direction of Gov 2.0. Governments willing to take the early leap by circumventing their IT procurement process and engaging with innovators directly can expect some growing pains, but they will likely be dulled by ultimate cost savings.

 

The traditional format of government procurement has been grounded in the 1950’s-style door-to-door salesman. Governments release a solicitation and wait for the salesman to ring their door bell to peddle goods. Now, government agencies with strict budgets have the option to shop around without going through a lengthy and expensive procurement process. Governments want convenience and efficiency without having to sacrifice quality and they are willing to go outside the traditional procurement process to get it. 

 
Subscribers have access to the full article here, including expanded analysis and recommendations for contractors.
Also, be sure to follow Deltek's General Government Team on Twitter @GovWin_GenGov.

The consequence of the Middle Class Tax Relief and Job Creation Act of 2012

On February 22, President Barack Obama signed the Middle Class Tax Relief and Job Creation Act of 2012 into law. The bill provides a variety of benefits to help middle class Americans, including Medicare payment extensions, social security payroll tax cuts, extension of job incentives to small businesses, as well as moving some public safety radio systems to a new broadcast spectrum (one that has yet to be defined).
In the same month that President Obama signed this bill into law, the Lancaster County, Penn., Board of Commissioners voted to negotiate with ARINC to build a new radio system on a television communications band (T-band). The new bill threatens this project, as it has created an incentive auction of the broadcast TV spectrum. Despite the possibility that this project, and 800 like it across the country, are put in jeopardy, Lancaster County’s public safety radio communications consultant from MWF Enterprises does not see this as a problem. The legislation would require the county to abandon the spectrum in nine years. In addition, the law includes a requirement for TV stations to change channels, which may be unlikely considering the significant branding that stations have for their channel numbers. Also, the legislation would carry a $1 billion price tag for the federal government, which might force a future change.
Analyst’s Take:
While it might be too soon to determine what the end result of this new legislation will mean for public safety agencies, vendors should not change course. They should continue with plans to develop T-band radio communication systems and should ensure that they offer full disclosure when providing plans for these systems, whether it is at the planning and consulting phase or in the implementation phase. Local governments may be hesitant to spend tens of millions of dollars on a system that may have to change bands in less than 10 years. As the federal government continues its plans for the spectrum, vendors must keep a watchful eye to determine how this may affect their radio system development.

Deltek Pulse: Health care and social services – February 2012 recap

As the January 2014 implementation deadline fast approaches, February was yet again chock-full of news surrounding health insurance exchanges (HIXs). While some states continue to make progress toward meeting the deadline, others are still contesting the federal HIX mandate and plan to wait out the results of this month’s Supreme Court case surrounding its legality.
On Feb. 22, the Department of Health and Human Services (HHS) awarded additional Level One and Two establishment grants to 10 states, totaling nearly $230 million. Among them, Colorado, awarded $18 million, completed proposal submissions for two HIX-related procurements: HIX Services and HIX Operational Services. Other consulting and quality assurance-related procurements are in the pipeline. Nevada, awarded its second Level One grant worth $15.3 million, will use the funding to build a rules-based eligibility engine, to develop an operational plan, and to determine certain business and IT requirements unrelated to eligibility.
As the 2013 fiscal year (FY) approaches, governors continued to release state budget recommendations throughout February. A commonality amongst states is the continued battle to fund the ever-growing Medicaid population, particularly in the face of Medicaid eligibility expansion resulting from the Affordable Care Act (ACA). Beginning January 1, 2014, states will be required to expand Medicaid eligibility to all people below 133 percent of the federal poverty level, adding approximately 15.9 million newly-eligible beneficiaries to the Medicaid program. Based on the state budgets Deltek has analyzed since the start of the year, Massachusetts will see the biggest increase in Medicaid spending in FY 2013, with a 64.4 percent increase since FY 2010. Other major increases since FY 2010 include Alaska at 49.7 percent, Delaware at 36.4 percent and California at 35.4 percent.
On Feb. 23, North Carolina announced it would once again extend its current contract with Hewlett-Packard (HP), while Computer Sciences Corporation (CSC) – awarded the replacement Medicaid management information system (MMIS) contract in December 2008 – continues to build its MMIS for the state. This $122 million, two-year contract extension is the second awarded to HP for the MMIS, bringing the total contract value up to an estimated $616 million. Meanwhile, CSC was awarded another replacement MMIS contract with the Maryland Department of Health and Mental Hygiene, valued at $297 million.
Further, Florida was selected by the Centers for Medicare and Medicaid Services (CMS) to pilot the latest version of the Medicaid Information Technology Architecture (MITA) initiative, MITA 3.0. In doing so, the Agency for Healthcare Administration (AHCA) will complete a state self-assessment (SSA) and develop a roadmap to be used in planning future system upgrades and replacements to be completed by the end of June 2012.
Continuing to work toward the HIX implementation deadline, I predict states will be busy hiring consultants, producing technical plans, and releasing HIX solicitations throughout the next few months. However, this all may come to a halt pending the outcome of the March 26 – 28 Supreme Court case surrounding ACA. Expanded Medicaid eligibility may also be affected by the outcome of the case.
Throughout March and April, Deltek will continue to delve into state budget recommendations and take a closer look at Medicaid spending data. Be on the lookout for the round 3 of our series on the rising price of health care costs! As always, remember to follow Deltek’s Health Care and Social Services team on Twitter @GovWin_HHS, or connect with us through LinkedIn!

Breaking down President Obama's FY 2013 budget: Health and human services

While most people were occupied with last-minute Valentine’s Day preparations earlier this week, President Obama was busy announcing the FY 2013 budget. Rest assured that Deltek will be analyzing every inch of the data to uncover key trends and opportunities for our member network. This analysis will focus on funds trickling down to the states from the health and human services vertical. The Department of Health and Human Services’ (DHHS) Deputy Secretary Bill Corr spoke to the public on Feb. 13 and highlighted the health objectives the budget package addressed. DHHS plans to strengthen the nation’s health care, continuing on the Affordable Care Act (ACA) of 2010. Initiatives include health insurance exchange development, expanding community health programs, and increasing the health care workforce. Fighting fraud, waste, and abuse continues to be priority number 1 – the department collected almost $4 billion last year in improper payment recoveries. Corr also stated the FY 2013 budget and, specifically, Medicaid reform will help reduce the federal deficit by $366 billion over 10 years.
 
Following the same trend as last year, discretionary spending (Table 1, below) is set at $30 billion, which is down nearly 3.5 percent from FY 2011. Programs seeing major cuts include the public health and social services emergency fund and low-income home energy assistance (LIHEAP). The Distance Learning, Telemedicine, and Broadband Program saw a 68 percent increase to $42 million, following through on DHHS’ promise to strengthen health care, especially in rural areas. Mandatory spending (Table 2) also corresponded with DHHS goals and saw an 82 percent increase in funding for health insurance exchange establishment, totaling $868 million. Grant funding to states for Medicaid totals $269 billion. Stay tuned for FY 2014 numbers as eligibility enrollment is estimated to increase by nearly 16 million Americans. 

Table 1: Federal Grants to State and Local Governments, Discretionary (in millions of dollars)

 Click on image above for full-sized version

 

Table 2: Federal Grants to State and Local Governments, Mandatory  (in millions of dollars)

Click on image above for full-sized version

Other areas of the budget proposal include:

  • Temporary Assistance for Needy Families (TANF): TANF funding rises nominally to $17 billion in FY 2013.
  • Supplemental Nutrition Assistance Program (SNAP): The budget includes $7 billion in SNAP benefits, a 5 percent increase from FY 2011. Although states are seeing record food stamp numbers, the Department of Agriculture (USDA) transferred $400 million to support the Women, Infants, and Children (WIC) Program for FY 2012.
  • WIC: Program funds increased by 14 percent to $7 billion, which includes $14 million for infrastructure funding and $30 million for management information systems.
  • Child Support Enforcement: Funding took a 7 percent dip to $3.8 billion. The budget request includes new investments of $305 million in FY 2012 and $2.4 billion over ten years for the Child Support and Fatherhood Initiative.
  • Child Care: Proposes $6 billion for child care, which includes $2.6 billion for the Child Care and Development Block Grant to supplement assistance for low-income families; and entitlement to states is $3.4 billion.
  • Child Welfare: Requests $7.2 billion for foster care and permanency services including adoption and guardianship assistance, foster care, and independent living.
Overall, the FY 2013 budget produced minimal funding changes for health and social services programs. Vendors playing in the health care field will see the most benefit in those pocket areas of increased funding, especially surrounding health insurance exchange implementation, Medicaid system reform, and eligibility redetermination. Those thinking that the ruling on the ACA later this summer will stem exchange development should think again. Many states are planning to continue developing systems whether the act holds or not. With the major push to cut down on federal spending and fight abuse in the human services arena, vendors need to keep reporting systems up to date with all required mandates and regulations. As health information exchanges start to be rolled out this year, it should be interesting to see which states will find success in transferring electronic medical records, and which will not. It seems that health care will continue to be the hot topic of FY 2012 and FY 2013.

 

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