Hart Health Strategies provides a comprehensive policy briefing on a weekly basis. This in-depth health policy briefing is sent out at the beginning of each week. The health policy briefing recaps the previous week and previews the week ahead. It alerts clients to upcoming congressional hearings, newly introduced bills, regulatory announcements, and implementation activity related to the Patient Protection and Affordable Care Act (PPACA) and other health laws.


Obama Administration Releases Data on BCA Sequestration Cuts

The Office of Management and Budget released a report mandated by Congress that was supposed to provide great detail on the spending cuts to defense and domestic programs scheduled for next January under the Budget Control Act. Republicans were quick to criticize the lack of detail in the report on the BCA’s effect on specific programs, projects and activities. Overall, defense and non-defense spending would each be cut by $54.7 billion in FY 2013 with appropriated defense spending being cut by 9.4% and non-defense discretionary accounts being cut by 8.2%.

The report did specify that Medicare providers would take a hit of about $11.1 billion in FY 2013 and that Medicaid, SCHIP, VA health programs and the PPACA PCIP program would be exempt from the spending reductions. Medicare Part A mandatory spending would be reduced by about $5.6 billion, Part B by about $4.9 billion and Part D by about $559 billion. Provider groups responded that the latter Medicare cuts would result in a loss of about 700,000 jobs by 2021.

In addition, the report stated that:

tdiscretionary spending would be reduced by $2.5 billion for NIH, $605 million for HRSA, $409 million for the CDC, $391 for the FDA, $275 million for SAMHSA, and $356 million for Indian Health Services;

tmandatory funding for health care fraud and abuse would be cut $53 million while such discretionary spending would be cut by about $25 million;

PPACA grants for state health insurance exchanges would be cut by $66 million and the prevention fund by about $76 million; and

the Office of the National Coordinator for Health Information would get a $1 million haircut.

The White House said that “the destructive across-the-board cuts required by the sequestration are not a substitute for a responsible deficit reduction plan.” House Republicans attempted to partially insulate themselves from the impact of sequestration by passing H.R. 6365, legislation that would require the President to provide Congress, by October 15th, with a plan to replace the defense cuts by other spending reductions and without increasing revenues. Under the bill, once a plan to replace the automatic cuts with other spending cuts is enacted, the bill would reduce the cap on discretionary spending for FY 2013 by $19 billion and remove the separate caps for defense and non-defense discretionary spending.

Democrats called the action a “charade” and the White House issued notice that the President would veto the bill (which is a non-starter in the Senate). Any action to delay or ameliorate the sequestration cuts will have to come in the lame-duck session inasmuch as House Majority Leader Eric Cantor said that the House will recess this Friday until after the November 6th election.

The Senate bipartisan “Gang of Eight” is reportedly in discussions to develop a comprehensive deficit reduction plan that would reduce deficit spending by $4 trillion over ten-years through revenue increases and entitlement changes. They are also considering a delay in sequestration or a partial sequestration followed by a broader deficit reduction agreement. Senator Dick Durbin has suggested a six-month delay in the spending cuts.

December 31, 1969: | Page 1 Page 2



 -  2019

 +  2018