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.


All About Spending

This coming week, the Senate intends to finish its floor discussion of HR 933, the Continuing Resolution (CR), which will keep the government funded through the end of Fiscal Year 2013. After spending the bulk of the Senate floor time last week, Majority Leader Reid (D-NV) has indicated that the Senate plans to invoke cloture (a procedural vote to allow a bill to move forward) on the legislation Monday evening, paving the way for final Senate passage on Wednesday at the latest. With the current continuing resolution ending on March 27, both the House and Senate leaders would like to wrap up discussions before the start of the Easter/Passover recess, beginning as early as this Friday.

The Senate manager’s package maintained key health-related provisions of the House-passed legislation, including $1.043 T in total budget authority while leaving sequestration in place, a $10 M rescission from the Independent Payment Advisory Board (IPAB), and a $6.4 B rescission for Medicaid/CHIP performance bonus payments . Unlike the House version of the legislation, the manager’s amendment in the Senate also included a rescission of $200 M from the community-based care transition program included within the Affordable Care Act (ACA), additional funding for food safety activities at the Food and Drug Administration, and an additional $71 M for funding at the National Institutes of Health (NIH), among other items. The Senate floor debate has resulted in very few changes to the underlying legislation. The first health-related amendment by Sen. Cruz (R-TX) to prohibit the use of funds to carry out the ACA was rejected by a vote of 45-52 on Wednesday. On Thursday, the Senate rejected a Harkin (D-IA) amendment by a vote of 54-45 that would, among other things, increase NIH funding by $211 million and provide a $29 million increase for the Ryan White AIDS Drug Assistance Program.

Budget Battles

As expected, House Budget Committee Chair Paul Ryan (R-WI) released the House Republican budget proposal on Tuesday of last week. His budget blue print balanced the budget in ten years by maintaining the current sequestration cuts, by including a so-called Medicare premium support program under which beneficiaries would receive a subsidy to purchase either a private health care plan or a traditional Medicare plan, by block-granting Medicaid, by repealing the Affordable Care Act (ACA) expansion of Medicaid and exchange subsidies, by including medical liability reform (which includes a cap on non-economic damages), and by including a full repeal of the Independent Payment Advisory Board (IPAB). Democrats quickly noted that the Ryan budget plan would cause real harm to the Medicaid and Medicare programs. After rejecting amendments to increase taxes rather than block grant Medicaid, maintain support for the health care law’s pre-existing condition provisions, reject the proposed changes to Medicare, and increase funding for a variety of programs including the National Institutes of Health (NIH), the House budget committee quickly moved to report out the legislation (on a party-line vote) last Wednesday, and the Majority Leader has recently indicated that the House will take up this legislation this week.

Senate Budget Committee Chair Patty Murray (D-WA) released a dueling Senate budget proposal on Wednesday of last week. In contrast to the Ryan budget, Sen. Murray’s proposal would not maintain the current sequestration (including the 2% cut to Medicare providers), would not make specific changes to Medicare or Medicaid, would not repeal the IPAB, would not include medical liability reforms, and would leave the ACA intact. In lieu of more dramatic health care changes, her budget would instead assume the repeal of the Medicare Sustainable Growth Rate (SGR) funding formula, without indicating the proposal to replace the SGR funding formula and include $275 billion in cuts to health spending “by further realigning incentives throughout the system, cutting waste and fraud and seeking greater engagement across the health care system.” Of the $275 billion cuts in health care, $265 billion are in Medicare and $10 B are in Medicaid. Republicans quickly noted that the budget plan does not require a balanced budget in 10 years, thus falling short of its stated goals. After rejecting amendments to create a point of order if the budget is not balanced by 2023, to require that the $275 billion cuts in health care have formal reconciliation instructions, to repeal the medical device tax, to means test Medicare, and to include medical liability reform, the Senate budget committee quickly moved to report out the legislation (on a party-line vote) last Thursday. The Senate Committee aides have indicated that the full Senate will likely consider the legislation as early as this week. The last time the Senate voted on a budget was in 2009.

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