How A Government Shutdown Could Impact Healthcare Distribution
Frequently Asked Questions As Of September 26, 2023
Funding for approximately $6.3 trillion in federal government programs is set to expire by the end of the federal fiscal year on September 30, 2023. If Congress does not pass appropriations legislation or a continuing resolution to extend this funding, the federal government will experience a partial shutdown.
How long will a shutdown last?
Each shutdown looks different and may be one or two days or over a month. In 1996, a shutdown caused by a dispute over budget funding lasted for 21 days. In 2013, a shutdown lasted for 16 days. The most recent shutdown occurred in 2018, and lasted for 35 days.
What does a shutdown mean for the federal agencies?
Each agency will bring nonessential functions to a halt via their own contingency plan. The Department of Health and Human Services (HHS) will continue to support activities deemed critical to the safety of human life through other funding mechanisms. Approximately 58% of HHS employees will be retained, with the remainder being furloughed.
How will the Administration for Strategic Preparedness and Response (ASPR) and the Strategic National Stockpile (SNS) be impacted?
ASPR will maintain readiness for all hazards, including COVID-19, pandemic flu, and hurricane responses as well as medical countermeasure management. If a shutdown occurs, 47% of ASPR staff will be retained, allowing the agency to focus on programs impacting the safety of human life or protection of property. SNS is expected to continue its essential activities as well.
How will the Food and Drug Administration be impacted?
Vital activities related to imminent threats will continue. This includes responding to public health emergencies, mitigation efforts related to potential drug and medical product shortages, and supply chain disruptions. Medical device infection control, work on enforcement actions for fraudulent, counterfeit, and misbranded products, and work on medical countermeasures, therapies, and vaccines will continue.
Will Medicare and Medicaid be impacted?
Mandatory or entitlement programs funded outside of the annual appropriations process, such as Medicare, Medicaid, and Social Security, will continue. Payments to healthcare providers are expected to continue uninterrupted.
Will U.S. Customs and Border Protection (CBP) still operate?
CBP will remain an essential function within the government due to its role in national security as well as the flow of commerce.
How does a shutdown impact government contracts?
In the event of a shutdown, the federal government will not award new contracts or issue modifications to existing contracts. Some contracts may be funded incrementally, and contracts that are fully funded or deemed essential are permitted to continue.
How will the Pandemic and All-Hazards Preparedness Act (PAHPA) be impacted by a shutdown?
The federal law empowers ASPR to plan for natural disasters and pandemics and the impact on PAHPA is two-fold.
- First, the law, which authorizes numerous programs such as the Hospital Preparedness Program, is set to expire on September 30. Unfortunately, Congress has not reached an agreement on final reauthorization legislation ahead of its expiration date.
- Second, a shutdown means the funds no longer appropriated for certain provisions within the law will cease to operate. Those expiring provisions include a demonstration project for regional healthcare preparedness and response systems, several Advisory Committees, and other provisions not directly impacting healthcare distributors.
However, per the ASPR and HHS contingency plans, many PAHPA programs will continue to operate in their roles responding to public health emergencies.
If the shutdown occurs on October 1, 2023, House and Senate leaders will continue negotiating funding levels and other relevant policies in order to end the shutdown. Contact the HIDA Government Affairs team: Kathryn DiBitetto (firstname.lastname@example.org) or Wyeth Ruthven (email@example.com) with questions.