Health Center Federal Policy

Congressional Budget Update: Where it all stands…

Since our last post on the House and Senate Budget blueprints, the two houses of Congress have now formalized their joint budget.  This budget is both non-binding and completely separate from the President’s budget (also non-binding).  Instead of a detailed program-by-program breakdown of Federal spending, the Congressional budget resolution simply provides general funding targets and “instructions” for meeting such targets.

Budget Chairmen Enzi & Price

While the budget reconciliation instructions direct the pertinent Congressional committees to repeal the Affordable Care Act—and also recommends certain alternative policies—there is not yet any practical impact.  The next step is for the committees to develop legislation meeting the directed budgetary targets, through changes in Federal revenue and/or spending.  The complete legislation will have to be considered in both the House and Senate, any compromises reached, after which point it can be passed by only a simple majority in the Senate and cannot be held up by a filibuster.  It can, however, still be vetoed by the President, in which case Congress would still need a two-thirds majority to override the veto.

What Can We Expect?

Significant ACA reforms are likely to be proposed as part of the ongoing reconciliation effort, as are changes to the Medicaid program.  While Medicaid changes have not yet been specified, our preliminary understanding is that it would likely eliminate the Medicaid expansion and restructure the traditional Medicaid program—likely by capping federal funding—to the tune of $500 billion in cuts.  The trickle-down results of such a significant cut to the program could well mean changes to the FQHC service package or FQHC Prospective Payment System (PPS).

One other item of particular note to health centers is the inclusion of a “Deficit Neutral Reserve Fund” for improving community health centers in the budget resolution.  It does not have any specific or immediate impact on health centers, but does show Congress’ support for the issue and would have made it procedurally easier for Floor consideration of a cliff fix (the language was included at the request of Senators Wicker (R-MS) and Enzi (R-WY) before H.R. 2 included a two-year fix to the cliff).

Beyond this, there are any a number of other health care issues that could be addressed in an upcoming budget reconciliation bill.  The key thing to remember is that this is an ongoing and iterative process that still has a ways to go before coming law.  In fact, it is unlikely that we will see any final action on a budget reconciliation bill until after the Supreme Court announces its decision on King v Burwell (likely in late June).  Because the budget reconciliation process can only be used once a year, Congress won’t squander the opportunity lightly; Congressional leaders have made it clear that if necessary they will use the reconciliation process to address any fallout from the decision.  We don’t yet know what that will actually look like, of course, but are tracking it closely and will be sure to keep you all updated here.