POLICY BRIEFINGS


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.


THIS WEEK'S BRIEFING - MARCH 21, 2011


Federal Spending Cut $6.1 Billion Over Three Weeks


Last week President Obama signed into law (P.L. 112-6) the House-passed continuing resolution (until April 8) which the Senate approved with little opposition from Democrats after House Republican leadership prevailed in excluding controversial riders, such as provisions that would have defunded the PPACA.  However, the House vote, 271-158, included 54 Republican no votes, thus setting up a high barrier for Speaker Boehner to overcome in his next move to pass a final FY 2011 CR   The $6.1 billion discretionary spending cuts largely reflect recommendations in the President’s FY 2012 budget, including the elimination of unused earmarks and 25 other programs targeted for termination.  However, health programs were not overlooked, with $276 million in pandemic flu funding and $75 million in State Health Access grants eliminated. 

Senate Majority Leader Harry Reid said the inclusion of various riders would be a non-starter in the final budget negotiations which began last week.  House budget hawks, including the new “Tea Party” members, will insist on further FY 2011 cuts to round out the $61 billion in spending reductions under H.R. 1, while Senate Democrats will likely resist cuts of even half that amount.  Senator Schumer said “It’s time for [House Speaker Boehner] to abandon the Tea Party and forge a bipartisan compromise.”  However, 32 Republicans and 32 Democrats in the Senate wrote to President Obama urging him to enter the discussions on both FY 2011 and FY 2012 budget issues before April 8.  They implored that the discussions include discretionary spending cuts, entitlement changes and tax reform, as well.  To date, the President has stayed out of the fray, so the burden will fall principally to Speaker Boehner and Senate Majority Leader Reid.  The FY 2012 budget issues span the health spectrum, with Medicare and Medicaid facing major curtailments, and the perennial “doc fix” needing attention again to avoid a 29.5% cut in 2012 (CBO says the President’s budget freeze on physician payment rates through 2021 would increase outlays by $300 billion).  With AARA enhanced federal Medicaid funding ending this July, states will face even greater pressure now and in the future to meet their balanced budget requirements.  The need to increase the federal debt limit sometime in April may bring the White House into the discussions, however reluctantly, particularly given Senate Republican unity in opposing a debt limit increase without a major budget deal which includes entitlement changes.



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