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.


Fiscal Cliff Negotiations Begin

President Obama called the newly reelected congressional leaders to the White House on Friday to begin the first of the tense negotiations that will determine whether federal defense and non-defense discretionary spending will each be cut by $54.7 billion in FY 2013 pursuant to the Budget Control Act mandate and whether the Bush tax cuts will be allowed to expire this year.  The President said “We’ve got to make sure that taxes don’t go up on middle-class families, that our economy remains strong.  That’s an agenda that Democrats and Republicans and independents, people all across the country, share.  So our challenge is to make sure that we are able to cooperate together, work together, find some common ground, make some tough compromises, and build some consensus to do the people’s business.” 

The chief negotiator for House Republicans, Speaker John Boehner, said he presented an overall deficit reduction framework that includes increased revenues.  Senate Minority Leader Mitch McConnell concurred.

Although the President and Speaker Boehner did not make a big deal about their differences over increased tax rates for those earning over $250,000, the President and congressional Democrats have made it clear that an extension of the Bush tax cuts for “the wealthy” is a non-starter.  House Minority Leader Nancy Pelosi, elected by House Democrats to another two-year term, said she would favor a $4 trillion ten-year deficit reduction goal.  However, it is highly unlikely that a compromise on the specifics of tax and entitlement reform will come together this year.

For the President and Congress to agree on a $4 trillion or other long-term deficit reduction goal would be seen as enough progress this year to avoid severe public criticism and a possible market meltdown.  Senate Majority Leader Harry Reid weighed-in to say that Social Security cash-benefits changes should not be on the table, but that as to the other fiscal cliff issues “they cannot be pushed down the road…. We’re going to work during the Thanksgiving recess”.  The President also conducted “listening” sessions with various Democratic-leaning interest groups and another group representative of large businesses.

Medical Groups Oppose Sequestration

Health/Medical groups have pleaded with the White House and Congress to forego the sequestration cuts which, for example, would result in a 2% cut to Medicare payments, a cut of 8.2% to HHS/CMS administrative accounts, a cut of $2.5 billion in NIH accounts, a cut of about $500 million to the CDC, and a cut of $319 billion to FDA spending.  Looking to the long-term health of Medicare the AMA’s House of Delegates voted to support an effort to convert Medicare into a defined-contribution program, with a payment baseline adjusted for increasing health costs, while still allowing beneficiaries to purchase traditional FFS coverage as well as coverage from private health insurers.  Another senior/physician/patient-advocacy group said Congress should pay for any sequestration relief, including relief from the 27% cut in 2013 Medicare physician payments, by tapping unspent funds (OCO funds) previously allocated to fighting the wars in Iraq and Afghanistan.  Rep. Phil Gingrey, co-chair of the Republican “Doctors’ Caucus”, indicated he is “pretty confident” that Congress will approve a one-year fix to avert the 27% cut to Medicare payments.

Health Legislation Passes Senate

The Senate passed S. 1440, legislation to reduce preterm labor and delivery and the risk of pregnancy-related deaths and complications due to pregnancy and to reduce infant mortality caused by premature birth.  By unanimous consent, the Senate also sent to President Obama for his signature the following bill: H.R. 6118, The Taking Essential Steps for Testing Act of 2012, which provides CMS with more flexibility in sanctioning laboratories that send test samples to other labs for analysis.

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