link to page 1 link to page 1 link to page 1 link to page 1 link to page 1 
Updated July 15, 2020
State Health Insurance Assistance Program (SHIP)
Background
prescription drug low-income subsidy program and in
The State Health Insurance Assistance Program (SHIP)
Medicare Savings Programs.
provides funding to states for outreach, counseling, and
According to ACL, over 15,000 SHIP counselors, mostly
information assistance to Medicare beneficiaries and their
volunteers, in over 1,300 community-based organizations
families and caregivers on Medicare and other health
connected with 3.5 million individuals through one-on-one
insurance issues. The national program is authorized under
client contacts and an additional 3.0 million individuals
Section 4360 of the Omnibus Budget Reconciliation Act of
through public events explaining the Medicare program and
1990, as amended (OBRA ’90; P.L. 101-508; 42 U.S.C.
its benefits in 2017.
1395b-4).
Funding
The Consolidated Appropriations Act of 2014 (P.L. 113-76)
transferred SHIP administration from the Centers for
The majority of SHIP funding is provided through
Medicare and Medicaid Services (CMS) to the
discretionary budget authority in the annual Departments of
Administration for Community Living (ACL). This transfer
Labor, Health and Human Services, and Education, and
reflected the existing formal and informal collaborations
Related Agencies (LHHS) Appropriations Act.
between the state SHIP projects and the networks that ACL
Discretionary funding is also supplemented by mandatory
serves. An interim final rule, effective February 4, 2016,
funding for outreach and assistance to low-income
reflected the transfer from CMS to ACL (81 Federal
Medicare beneficiaries (see Table 1).
Register 5917). The interim final rule was adopted without
Table 1. State Health Insurance Assistance Program
change on June 3, 2016 (81 Federal Register 35643).
(SHIP) Funding, by Type (FY2009 to FY2020)
There are SHIP projects in all 50 states, as well as the
Discretionary Mandatory
District of Columbia and three U.S. territories (Guam,
Year
Funding
Funding
Puerto Rico, and the U.S. Virgin Islands). American Samoa
and the Commonwealth of the Northern Mariana Islands are
FY2009
$47,400,000
$7,500,000
not eligible for SHIP grants, as neither have an approved
FY2010
$46,960,000
$15,000,000
Medicare supplemental plan as required by law. Of the 54
FY2011
$52,000,000
a
SHIP grant programs, about two-thirds are administered by
State Units on Aging established under the Older
FY2012
$52,115,000
a
Americans Act. The remaining one-third are located in their
FY2013
$46,040,000
$7,115,000b
state insurance commissioner offices.
FY2014
$52,115,000
$7,500,000
Grant Activities
FY2015
$52,115,000
$7,500,000
SHIP grants provide funding for states to plan and operate
FY2016
$52,115,000
$13,000,000
various information, counseling, and assistance activities.
Medicare beneficiaries have received assistance through
FY2017
$47,115,000
$12,103,000c
one-on-one counseling in person, by telephone, on the
FY2018
$49,115,000
$13,000,000
Internet, or through email from paid and volunteer SHIP
FY2019
$49,115,000
$13,000,000
counselors. State SHIP projects also conduct public
outreach and education activities to inform beneficiaries
FY2020
$52,115,000
$13,000,000
about coverage and enrollment options.
Source: HHS, ACL and CMS budget justifications (FY2009 through
FY2020); P.L. 115-245, P.L. 110-275, as amended (see 42 U.S.C.
The SHIP grants support a community-based network of
1395b-3 note); and personal communication with ACL.
state and local programs that provide personalized
Notes: Amounts are not adjusted for inflation.
assistance to Medicare beneficiaries and their families on
questions related to Medicare, supplemental insurance
a. The Patient Protection and Affordable Care Act (P.L. 111-148,
policies (Medigap), Medicare Advantage plans, Medicare
as amended) appropriated $15 mil ion for FY2010-FY2012.
Savings Programs, Medicaid eligibility and coverage issues,
b. $7.5 mil ion appropriated; amount reflects 5.1% reduction due
long-term care insurance, and other health insurance issues.
to mandatory spending sequester.
c. $13 mil ion appropriated; amount reflects 6.9% reduction due to
Since the passage of the Medicare Prescription Drug,
mandatory spending sequester.
Improvement, and Modernization Act of 2003 (P.L. 108-
173), a major focus of SHIP-funded programs has been to
Discretionary Funding
help beneficiaries obtain Medicare prescription drug
OBRA ’90 (P.L. 101-508) authorized the appropriation of
coverage, Medicare Part D, and enroll in the Medicare
$10 million in equal parts from the Medicare trust funds
(i.e., the Federal Hospital Insurance Trust Fund and the
https://crsreports.congress.gov
State Health Insurance Assistance Program (SHIP)
Federal Supplementary Medical Insurance Trust Fund) for
Fixed amount (first $10 million): Each state, the District
each of FY1991 to FY1993. Congress and the President
of Columbia, and Puerto Rico receives a fixed amount of
subsequently extended SHIP authorizations of
$75,000. Guam and the U.S. Virgin Islands each receive
appropriations to FY1996 under P.L. 103-432. While the
$25,000.
authorization of appropriations expired in FY1996,
discretionary funding has continued to be provided through
Variable amount (remainder of first $10 million, if any):
the annual appropriations process. Discretionary budget
Each entity receives an amount based on a formula that
authority for SHIPs is provided to ACL in the LHHS
considers the percentage of all Medicare beneficiaries
appropriations bill and funds discretionary grants to states
nationwide who reside in the state (75%), the percentage of
as well as ACL program support.
the state’s Medicare beneficiaries who reside in rural areas
(15%), and the percentage of the state’s Medicare
The Further Consolidated Appropriations Act, 2020 (P.L.
beneficiaries to the state’s total population (10%).
116-94), provided $52 million in discretionary
appropriations for SHIPs under ACL’s Aging and
ACL Discretionary Formula
Disability Services Programs budget authority for FY2020.
The Discretionary Formula allocation applies to any
This is $3 million (or 6%) more than the FY2019 funding
available funding above the first $10 million. It includes a
level. The FY2021 President’s budget requests $36 million
base funding amount and a formula for the remaining
for SHIPs, a $16 million reduction from the previous fiscal
funding.
year. ACL’s FY2021 budget justification states that the
requested level would result in proportionate reductions in
Base funding: Each state, the District of Columbia, and
grants to states and U.S. territories compared with the
Puerto Rico receives a fixed amount of $75,000. Guam and
FY2020-enacted level. In addition, some states supplement
the U.S. Virgin Islands each receive $25,000.
federal funding for SHIP programs with state funding.
Remaining funding: Each entity receives an amount based
Mandatory Funding
on a formula that considers the (1) percentage of all
Medicare beneficiaries nationwide who reside in the state
SHIPs also receive mandatory funding for outreach and
(80% of remaining funds), (2) the number of beneficiaries
assistance to low-income Medicare beneficiaries, which
in the state below 150% of the Federal Poverty Level (10%
was first provided for FY2008 under the Medicare,
of remaining funds), and (3) the percentage of the state’s
Medicaid, and SCHIP Extension Act of 2007 (P.L. 110-
Medicare beneficiaries who reside in rural areas (10% of
173). Beginning in FY2009, mandatory funding was
remaining funds).
provided under the Medicare Improvements for Patients
and Providers Act (MIPPA, P.L. 110-275; 42 U.S.C.
Mandatory Grants to States
1395b-3 note). This mandatory funding has been extended
SHIP grant amounts under MIPPA are provided to states
multiple times, most recently in the Coronavirus Aid,
based on a statutory funding formula. The total mandatory
Relief, and Economic Security Act (CARES Act; P.L. 116-
funding amount to each state is the sum of two separate
136) through November 30, 2020. In addition to SHIPs,
allocations based on the following:
mandatory funding for Medicare outreach and assistance to
low-income beneficiaries under MIPPA is provided to Area
Allocation based on percentage of low-income
Agencies on Aging, Aging Disability Resource Centers and
beneficiaries: Two-thirds of the state’s total allocation is
for benefits outreach and coordination to older Americans.
based on the number of individuals who meet the
This provision requires the HHS Secretary to transfer
requirements for the low-income subsidy under the
specified amounts to SHIPs from the Medicare trust funds.
Medicare Part D prescription drug program but who have
At present, mandatory SHIP funding for MIPPA activities
not enrolled to receive a subsidy, relative to the total
is appropriated to CMS and transferred to ACL.
number of individuals who meet the requirements under the
subsidy program in the state, as estimated by the HHS
Discretionary Grants to States
Secretary.
SHIP discretionary grants are provided to states (including
Allocation based on percentage of rural beneficiaries:
certain U.S. territories) based on formulas specified in
One-third of the state’s allocation is based on the number of
regulation and guidance. The total discretionary grant
Medicare Part D eligible individuals residing in a rural area
amount to states is based on two types of funding
relative to the total number of such individuals in the state,
allocations: (1) Regulatory Formula, and (2) ACL
as estimated by the HHS Secretary.
Discretionary Formula. Funds are awarded for a five-year
project period. The most recent period began April 1, 2020,
Additional Resources
and is to end March 31, 2025. Subject to available funding,
The SHIP National Technical Assistance Center
no state’s total funding is to increase or decrease by more
(www.shiptacenter.org) is a central source for program
than 5% from one budget year to the next.
information. The center provides training, technical
Regulatory Formula
assistance, and other activities to support state projects and
includes a directory of SHIP contacts in each state.
The Regulatory Formula allocation includes a fixed amount
and a variable amount that applies to the first $10 million
Kirsten J. Colello, Specialist in Health and Aging Policy
of available funding.
IF10623
https://crsreports.congress.gov
State Health Insurance Assistance Program (SHIP)
Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to
congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress.
Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has
been provided by CRS to Members of Congress in connection with CRS’s institutional role. CRS Reports, as a work of the
United States Government, are not subject to copyright protection in the United States. Any CRS Report may be
reproduced and distributed in its entirety without permission from CRS. However, as a CRS Report may include
copyrighted images or material from a third party, you may need to obtain the permission of the copyright holder if you
wish to copy or otherwise use copyrighted material.
https://crsreports.congress.gov | IF10623 · VERSION 8 · UPDATED