TRP Health Policy Report
February 17, 2015Last week saw more political jockeying over a Department of Homeland Security (DHS) funding bill (H.R. 240), but little progress in advancing the measure. Republicans had hoped to use the bill to reverse President Obama’s immigration policies, but their effort has been blocked by Senate Democrats. The impasse could jeopardize funding for the DHS, which expires on February 27. Before adjourning, the Senate struck a rare note of bipartisanship in voting 93-5 to approve Ash Carter’s nomination to serve as Secretary of Defense. In the House, members voted 272-142 last Friday to renew (H.R. 636) tax credits for small businesses. Last Thursday, the House advanced a separate tax extenders package (H.R. 644) regarding credits for charitable giving, which passed 279-137. In other legislative activity, the House voted Wednesday to force approval of the Keystone XL pipeline (S. 1), setting up a veto confrontation with President Obama. The legislation, which passed in the Senate in late January, was approved by a vote of 270-152.
Off the Hill, HHS reported that at least 10 million people have enrolled in health insurance under the Affordable Care Act (ACA). The agency said 7.75 million have signed up in the 37 states that use the federal exchange. Nearly 2.4 million enrolled in states running their own exchanges. HHS had projected 9.1 million signups by the Feb. 15 deadline, which is several million less than its earlier target. White House officials touted the positive impact of the ACA, noting a recent Gallup survey that found the rate of uninsured Americans dropped from 17 percent to 12.9 at the end of 2014.
The Week Ahead
The House and Senate are adjourned until February 23. When lawmakers return, the Senate will vote for the fourth time to proceed to the House-passed DHS funding bill (H.R. 240) that includes language to revoke President Obama's executive actions on immigration. All of the three previous votes to invoke cloture on the motion proceed failed to get the necessary 60 votes to advance.
DeGette Cites Progress on 21st Century Cures Bill
Last week, Rep. Diana DeGette (D-CO) said House Energy and Commerce staffers are working in a collaborate manner to complete a bipartisan draft of the 21stCentury Cures bill. Rep. Fred Upton (R-MI), chairman of the powerful House panel, released a discussion draft of the legislation late last month, but DeGette did not sign onto it, fueling speculation that the two had stopped working together. But in an address last Wednesday, DeGette downplayed those concerns, asserting that committee staffers from both parties have been meeting on a regular basis. DeGette, the top Democrat on the E&C Oversight Subcommittee, has worked with Upton on potential legislation to speed regulatory approvals, modernize clinical trials and incentivize the development of new drugs to fulfill unmet medical needs. “I didn’t sign on to the [Upton] document, not because I’ve abandoned the process…but because I felt it was still a work in progress,” the Colorado lawmaker explained.
DeGette and Upton have both said that President Obama’s recently announced $215 million Precision Medicine Initiative – which calls for an extensive genome-mapping study with 1 million volunteers – represented a hopeful sign that the White House will support the bill's provisions to encourage development of personalized medicine. “There are lots of ways that we’ve been doing biomedical research over the years that are archaic and cumbersome,” Degette said. “If we can remove some of those barriers and get incentives, then we can really expedite the way we’re doing biomedical research.”
CBO: Deficit to Fall Again in 2015, Then Start To Rise with Higher Medicare Spending
Last Wednesday, the Treasury Department said the U.S. budget deficit increased in January, a sign that declines of the past five years are flattening out. For the first four months of the budget year that began in October, the deficit totaled $194.2 billion, compared to $182.8 billion during the same period last year. Deficits have fallen sharply over the past five years, reflecting the country's economic recovery from recession. The CBO projects the annual deficit will fall to $468 billion this year, the lowest level since 2007. The agency forecasts that it will stay essentially flat until 2017, after which it begins to rise, topping $1 trillion in 2025 as spending increases for Social Security and Medicare.
With Republicans now in control of both chambers of Congress, big battles loom this spring over how the government should raise and spend money. President Obama’s nearly $4 trillion budget would ease spending curbs set to take effect in October when a previous, two-year bipartisan budget agreement expires. GOP leaders say the President’s budget blueprint does too little to deal with deficits; top lawmakers have said their proposal later this spring will balance the budget within 10 years. Many Republicans also want to ease previously agreed-to curbs on military spending, but Democrats have insisted that any increases in military spending be matched with gains for nondefense spending. Congress must also vote to raise the federal debt limit, which has been extended through mid-March. The CBO forecast shows the Treasury could take certain steps to avoid hitting the debt ceiling until September or October.
In a preview of how difficult it would be to make changes to entitlement programs, the White House and GOP lawmakers are clashing over how to shore up a Social Security program used to support individuals with disabilities. If Congress doesn’t take action, the Social Security Disability Insurance program will run out of sufficient funds by late 2016, according to the Social Security chief actuary,resulting in a 19% cut in disability benefits. That prospect has alarmed the White House and lawmakers from both parties. President Obama’s fiscal 2016 budget would increase the portion of the payroll tax going to the disability fund by 0.9 percentage point, redirecting $330 billion from the retirement fund over five years. Last Wednesday, top Republicans on the Senate Budget Committee challenged the White House plan, arguing that the President must do more now in anticipation of the enormous problems ahead. Absent a bipartisan fix, Congress could ultimately adopt a short-term solution that would allow them to revisit the fight in 2017. In fact, House Republicans have already put in place a rules change allowing a smaller reallocation but making it harder for the President’s plan to be enacted — without additional steps to improve the combined balance for the two trust funds.
Study: SCOTUS Ruling Could Carry High Cost for Consumers
A new report by The Urban Institute, a progressive think tank, says a Supreme Court ruling to strike down federal healthcare subsidies could carry a high price-tag for consumers. The high court will hear arguments next month in King v. Burwell, a case that questions whether the federal government can legally provide healthcare subsidies in 34 states that have opted out of creating their own exchanges. The Urban Institute’s researchers found that if the court strikes down the subsidies, there will be $12 billion worth of healthcare that is not paid for in 2016, because people will lose insurance that they can no longer afford without the subsidies. Much of the "uncompensated care" comes in the form of emergency room visits by people without insurance. The report estimates 8.2 million people will lose insurance should the Supreme Court rule against the law, including around 6 million who will be stripped of subsidies and more than 1 million more who will be unable to afford coverage because of premium increases.
Researchers noted that the new inability of people to pay would hit hospitals particularly hard because of cuts already implemented under the ACA. The findings on the increase in uncompensated care are part of an expected upheaval in the health insurance market if the Supreme Court strikes down the subsidies. Three House Republican committee chairmen were tasked last month with creating a Republican contingency proposal for what to do if the high court invalidates the subsidies. For its part, the White House has refused to discuss whether it has a contingency plan, saying it is confident that the Court will rule in its favor. Meanwhile, legal supporters of the Affordable Care Act say new information about the plaintiffs in King v. Burwell could derail the case before the justices have a chance to rule. The standing of the four plaintiffs in the case has come under increased scrutiny, with at least three of the challengers now facing claims they are not personally harmed by the law and therefore do not have a legal basis to sue.
Rep. Murphy Slams HHS Response to GAO Mental Health Report
Last week, an influential House member slammed HHS for its response to a Government Accountability Office (GAO) report that found lapses in the coordination and evaluation of federal programs for those with serious mental illnesses. The GAO study provided new details of a patchwork of at least 112 separate and disjointed programs across eight agencies, most of which are not evaluated on a regular basis. It also found that the government examined less than one-third of its programs in recent years. At a hearing last Wednesday, Rep. Tim Murphy (R-PA), who leads the House Energy and Commerce Oversight Subcommittee, said GAO report has produced “unassailable evidence” that the mental health system is broken. The panel’s Democrats, including ranking member Rep. Diana DeGette (D-CO), also raised concerns about the report. The findings were detailed in a report that GAO conducted in the aftermath of the Sandy Hook shooting in Newtown, CT. Murphy blasted HHS’s response to the report, in which it acknowledged efforts to improve coordination, saying they do not address the wider failures. “This is unbelievable. The hubris shown by HHS is downright insulting and callous,” Murphy said at the hearing. “This is a clear example of unaccountable government.” Murphy, a psychologist, plans to reintroduce his wide-reaching mental health legislation from last Congress.
Senate Democrats Push to Fund CHIP through 2019
Last Thursday, Senate Democrats launched a partisan push to end the funding battle over the federal government's child healthcare program, which is set to expire this fall. CHIP is a $13-billion-a-year program that provides insurance to about 8.1 million children nationwide, largely paid for by the federal government. But unless the program is reauthorized, states’ share of that funding will begin to run out in October. Last week, all Senate Democrats signed on as cosponsors to a bill that would extend funding for CHIP through 2019. It is the first bill in the 114thCongress to extend CHIP and was introduced the same day as a companion bill in the House. CHIP once enjoyed bipartisan support, but it has generated controversy recently because some Republicans believe the program overlaps with new benefits under the Affordable Care Act. Other lawmakers say that new subsidies and expanded eligibility under Medicaid should mean CHIP is no longer needed.
But Democrats have argued that the program is still needed, partly because nearly half of the states have yet to expand Medicaid. As many as 2.7 million children could lose health coverage or benefits next year if Congress does not renew CHIP, according to a study by the conservative American Action Forum. At a recent Senate Finance hearing, Sen. Sherrod Brown (D-OH), noted that more than 40 governors from both parties had asked lawmakers to renew the funding. Senate Finance Committee Democrats brought up an amendment to the Hire More Heroes Act that would extend funding for CHIP through 2019, but stopped short of offering the amendment.