Federal PolicyInformational Bulletin
CMS Issues Federal Funding Methodology for Basic Health Program Year 2027
CMS released an informational bulletin outlining the federal funding methodology for the Basic Health Program (BHP) in program year 2027. The guidance details how CMS will calculate federal payments to states operating BHPs — currently Minnesota and New York — for coverage of low-income individuals ineligible for Medicaid but below 200% of the federal poverty level. The methodology takes effect for the program year beginning in 2027. This matters for the two BHP states because the federal payment formula directly determines their program budgets and affects whether BHP remains financially sustainable compared to Marketplace coverage.
Why it mattersThe federal payment methodology determines whether Minnesota and New York can sustain their Basic Health Programs as a cost-effective alternative to Marketplace coverage for low-income populations.