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.


Pending Sequestration Casts Shadow Over President's State of the Union Address

President Obama, who will deliver his State of the Union Address to Congress on Tuesday, said that the upcoming March 1 spending cuts to domestic and defense programs would stall the progress of the economy. He urged Congress to at least delay the Budget Control Act (BCA) mandated sequestration for a few months as work progresses on the development of fiscal year (FY) 2013 budget resolutions in both the House and Senate.

While the President said that spending cuts and entitlement reforms have to go “hand in hand” with a process of tax reform, he reiterated his campaign slogan that the wealthiest Americans and corporations should not have the advantage of loopholes and deductions that are not available to most others. Republicans pushed back that taxes have been raised enough and that tax reform should follow a more budget neutral road.

The Administration highlighted the consequences of sequestration if allowed to go ahead at the end of the month: The National Institutes of Health (NIH)--would be forced to delay or halt vital scientific projects and make hundreds fewer research awards; the National Institute of Mental Health (NIMH)--cuts to the Mental Health Block Grant program would result in over 373,000 seriously mentally ill adults and seriously emotionally disturbed children not receiving needed mental health services; Food and Drug Administration (FDA)--the Center for Drug Evaluation and Research would face delays in translating new science and technology into regulatory policy and decision-making, resulting in delays in new drug approvals, and the FDA would be forced to abandon 2,100 inspections at domestic and foreign facilities that manufacture food products; Centers for Disease Control and Prevention (CDC)--cuts to the AIDS Drug Assistance Program could result in 7,400 fewer patients having access to life-saving HIV medications and about 424,000 fewer HIV tests could be conducted by CDC state grantees, which could result in increased future HIV transmissions, deaths from HIV and costs in health care.

As House Republicans begin to form their approach to budget reform, the Majority Leader said that they are looking at options to combine Medicare Part A and B and to reward doctors and patients who can help contain rising medical costs. In an attempt to put pressure on the President to promote balanced budgets, the House voted 253-167 to approve H.R. 444, the “Require a PLAN D Act,” legislation which would: require the President, if his original FY 2014 budget fails to show balance in any of the ten years covered by the budget to submit a supplemental budget; and the supplemental budget, due by April 1, would require the reporting of the first year the budget would return to surplus and what additional policies would be needed to achieve a balance.

Of note, as Congress begins the FY 2014 budget process, the Congressional Budget Office (CBO) released its baseline estimates showing that the federal deficit for FY 2013 will decrease to $845 billion (5.3% of GDP) from the $1 trillion level reached in FY 2012. CBO also said that Medicare spending grew by 3% ($16 billion) in FY 2012 -- its slowest rate of growth since 2000. The CBO estimates assume that the BCA mandated spending cuts of about $85 billion will take place on March 1st.

House Passes Health Legislation

The House passed the following health legislation: H.R. 297, the Children’s Hospital GME Support Reauthorization Act, legislation which authorizes $330 million per year through FY 2017 for the children’s hospital graduate medical education program; and H.R. 225, the National Pediatric Research Network Act of 2013, legislation authorizing NIH to fund pediatric research networks composed of consortia of institutions that cooperate in conducting research on conditions and diseases affecting children.

Long-term Care Commission Members

The temporary commission created under the fiscal cliff law to issue recommendations within 6 months on long-term care coverage and payment options will have 15 members named in equal numbers by the President, and the House and Senate Majority and Minority Leaders. House Minority Leader Nancy Pelosi named the following members: Bruce Chernof, president and CEO of the SCAN Foundation; Judith Stein, founder of the Center for Medicare Advocacy; and George Vrandenburg, founder of the USAgainstAlzheimer’s network. Senate Majority Leader Harry Reid named the following members: Javaid Anwar, a Nevada physician; Laphonza Butler, president of the United Long-Term Care Workers Union; and Judy Feder, a professor of public policy at the Georgetown Public Policy Institute. The commission was advocated by Senator Rockefeller as a replacement for the PPACA Class Act which was repealed.

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