What's Happening in Federal Health Policy?

Lori Buchsbaum, Northwest Health Law

Change of Direction from 2006

With the shift to a Democratic controlled Congress, the health issues under consideration have changed.  Many of the proposals on the table in 2006 are no longer moving forward.  In their place, the Democrats have identified new health priorities.

Congress
During the 110th Congress, lawmakers plan to address prices and coverage in the Medicare prescription drug program and the scheduled expiration of the State Children’s Health Insurance Program (SCHIP), among other health care issues.  The House Ways and Means Committee has identified oversight of the Medicare prescription drug benefit, health savings accounts and budget and staffing for the Centers for Medicare and Medicaid Services as priorities. 

To date, the following bills have been unveiled or proposed:

Medicare Prescription Drug Benefit (“Part D”)

The House of Representatives voted on January 12 to require the government to negotiate lower prescription drug prices for Medicare beneficiaries in Part D. The vote was 255 to 170.  The bill would require the Secretary of Health and Human Services to negotiate with drug companies and report back to Congress in six months.  The bill now goes to the Senate, where there appears to be support for some level of negotiations.  President Bush has threatened to veto legislation that would require government negotiation with pharmaceutical companies.

The Chairman of the Senate Special Committee on Aging (Herb Kohl) has said he will introduce a bill to help expand the low-income subsidy for Medicare Part D to more needy beneficiaries. The subsidy covers part of seniors’ monthly premiums and cost-sharing. Kohl said the Social Security Administration, which determines some of the seniors who qualify for the subsidy, should have access to IRS data so it can better target the potentially eligible population. At a committee hearing it was reported that 3 million to 4 million seniors who might be eligible for the subsidy are not signing up for Part D coverage.

Covering the Uninsured

A bipartisan group of lawmakers has proposed legislation that would make funding available for state initiatives to provide health care coverage to the uninsured. The legislation would provide grants to states, or portions of states, to come up with creative strategies for covering the uninsured. Strategies could include tax credits, expansion of Medicaid or the State Children’s Health Insurance Program, health savings accounts, relief from federal laws, etc. The amount of funding to be dedicated to these grants is yet to be decided.

A bipartisan group of House members has also announced a $60 billion plan that would provide health insurance to most American children who don’t now have it. The plan is supported by a broad coalition of consumer organizations and health care trade associations. The plan has not yet been introduced as legislation. Senators have agreed to introduce a similar plan.

Prescription Drugs

A bill has been introduced in the Senate that would require all online pharmacies that dispense prescriptions in the U.S. to obtain licenses from the FDA.

White House
During the State of the Union, the President put forward a proposal to help cover uninsured Americans.  Under the President’s proposal, anyone with health insurance would get a tax break equal to $7,500 for individuals and $15,000 for families. Those whose employers contribute more to health insurance than allowed by a premium “cap” would pay taxes on the contribution above the cap. The President also proposes to divert federal funds from public hospitals and health care providers to state-based programs to cover the uninsured. 

The President’s proposed 2008 budget, released in February, includes over $100 billion in Medicare and Medicaid cuts over five years. Hospitals, home health agencies, inpatient rehabilitation facilities and hospices would be particularly hard hit. 

It is not expected that these proposals will be enacted, as they do not have congressional support.

Lori Buchsbaum, Staff Attorney, Northwest Health Law Advocates