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.


Budget Agreement Sent to President

On a vote of 64-36, the Senate sent H.J.Res. 59 to the President for his signature (the Continuing Appropriations Resolution for 2014 which contains the Bipartisan Budget Act (BBA) of 2013 and the Pathway for SGR Reform Act of 2013). Passage was all but assured, however the Republican leadership rose in opposition to the relaxation of sequestration and criticized the $6 billion in savings that will come at the expense of reduced cost-of-living-adjustments (COLAs) for military retirees under the age of 62. The sustainable growth rate (SGR) pathway provisions delay until April 1, 2014 the Medicare physician payment cuts scheduled for January 1st and also allow for an increase in such payments by 0.5% over three years (at a cost of about $8.7 billion over ten years with the 0.5% 3-year increase amounting to $7.3 billion of the total). The offsets included in the measure (as previously described) would actually result in about a $300 million savings over the ten year period. The fate of the long-term SGR solution remains for the second session to determine (see more below) and without Senator Max Baucus (D-MT) chairing the Finance Committee, inasmuch he was nominated by President Obama as the next ambassador to China. The BBA portion of the bill increases federal discretionary spending above the sequestration level by $45 billion in fiscal year (FY) 2014 (to $1.012 trillion) and by $18 billion in FY 2015 (to $1.014 trillion). The increase would be split evenly between domestic and military accounts. Some of the BBA’s savings of $85 billion over ten years would come from extending the BCA’s 2% cut in Medicare payments to providers another two years to 2023 (about $28 billion in savings) and by allowing states to delay payments to Medicaid providers if fraud is suspected (about $1.4 billion in savings). Among the seventeen Medicare extensions: the Medicare Therapy Cap Exceptions Process through March 31, 2014; the Geographic Practice Cost Index (GPCI) through April 1, 2014; the Medicare Advantage Special Needs Plan (SNP) through next year; and the “Two Midnight Rule” hospital rule through October 1, 2014. The legislation also contains a non-binding resolution calling for the repeal of the Patient Protection and Affordable Care Act’s (PPACA) medical device tax. It was reported that the twelve Senate Appropriations subcommittee chairs were given their allocations in order to fashion their respective portions of the FY 2014 omnibus appropriations bill that the Senate and House appropriators hope to begin negotiating when Congress reconvenes during the week of January 6th. The Senate Appropriations Chair, Sen. Barbara Mikulski (D-MD), said she hopes the final bill will be taken up in the House on January 10th and in the Senate on January 15th. The consequences of the sequestration continues on with Senators Mark Pryor (D-AR) and Roy Blunt (R-MO), Chair and Ranking Member of the Subcommittee on Agriculture, Rural Development, Food and Drug Administration (FDA) and Related Agencies, decrying the BCA’s $85 million squeeze on FY 2013 FDA user fees and stating their intent to try and come up with a restoration of the funds while working around the impact it would have in increasing FY 2014 FDA spending by the same amount. When it came to the passage late Thursday of the National Defense Authorization Act of 2014, the Senate resorted to an expedited procedure to avoid a House/Senate conference that could have delayed consideration of the legislation until next year. The $625.1 billion authorized under the bill is about $3.1 billion less than for FY 2013. The bill increases the focus on treating stress disorders and traumatic brain injuries.

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