The first and most important thing to understand about the current government shut-down and how it may affect program beneficiaries is the difference between mandatory and discretionary spending. Certain programs like Medicare, Medicaid and the Affordable Healthcare Act (ACA) are mandatory programs—meaning they are not subject to annual appropriations. In other words, these programs are not dependent upon Congress to fund them year after year. This is not to say that the shutdown has no effect.
Many of the workers who help administrate the Medicare and Medicaid programs are considered non-essential. Therefore, many of those government workers will be furloughed during the shut-down. This in turn can impact processing times for applications and payments to vendors. Luckily, because Medicaid is primarily administrated by state agencies, rather than federal, this shutdown will have less impact on Medicaid than Medicare.
DEBT-CEILING—THE REAL ISSUE
What is likely to be more impactful on these benefits programs are the coming negotiations to raise the debt ceiling. In order for the Medicare and Medicaid programs to continue to receive funding, our country will have to continue to borrow money. In turn this mean we will have to raise the debt ceiling yet again. The issue will be by how much. It is likely that these programs will undergo large cuts in order to curb back government spending as politicians on both sides begin to realize the government cannot continue to spend at its current rate.
For now, the government shut-down is likely to have little effect on programs you rely on like Medicare and Medicaid. However; changes to these programs are inevitable and only time will tell just how drastic those changes will be.