WASHINGTON WIRE
September 7, 2007
Issue 144
In this issue, you'll find:
SCHIP Compromise Proving Difficult
Comparative Effectiveness Center to Result in Net Cost to Federal Government
President Bush Appoints Weems to CMS Acting Administrator
Top Story
SCHIP Compromise Proving Difficult
With a September 30th deadline looming, House and Senate Democrats are trying to begin informal negotiations on State Children's Health Insurance Program (SCHIP) reauthorization legislation as Republicans try to delay a formal conference.
Both chambers passed SCHIP reauthorization bills prior to the August recess hoping to reach a compromise prior to the program's expiration at the end of this month. The House bill would reauthorize the program for an additional $50 billion over five years, financing the expansion through a 45-cent tobacco tax increase and a cut to Medicare Advantage (managed care) programs. The House bill also contains numerous Medicare provisions including a two-year physician payment fix. The Senate bill, on the other hand, would add an additional $35 billion to the SCHIP program over five years, financing it exclusively through a 61-cent tobacco tax increase, and contains no Medicare provisions.
With such starkly different bills, many observers believe Democratic leaders are at an impasse. House Democrats want to keep their Medicare provisions in a final bill and maintain their $50 billion increase in SCHIP funding. However, Senate leaders fear they would loose their bipartisan support should they go beyond the 45-cent tobacco tax increase or target Medicare Advantage programs to pay for a larger bill.
Meanwhile, Senate Republicans are blocking the nomination of conferees before the scope of a final package is determined. Some Members are speculating that a conferenced bill will not be completed by September 30th and Congress will be forced to pass a short-term extension of SCHIP. However, Democratic leaders are not publicly entertaining that idea.
Health Care News
Comparative Effectiveness Center to Result in Net Cost to Federal Government
In a letter sent to House Ways and Means Health Subcommittee Chair Pete Stark (D-CA), Congressional Budget Office (CBO) Director Peter Orszag stated that implementation of the Center for Comparative Effectiveness Research, proposed in the House-passed Children's Health and Medicare Protection (CHAMP) Act, would increase federal spending by $500 million over five years and $1.1 billion over ten years.
The purpose of the center would be to study and comparing the effectiveness of health procedures and services - a controversial idea that supporters claim will improve healthcare quality and opponents fear will turn into a basis for price and coverage limitations by insurers.
The budget authority for the center would be $1.1 billion for the first five years and $2.9 billion over ten years and CBO estimates that outlays would be about $600 million and $2.4 billion respectively. Resulting changes to health care practices would save approximately $100 million in direct federal spending (Medicare, Medicaid, and the Federal Employees Health Benefits program) over five years and approximately $1.3 billion over a ten-year period. The result would be a net cost of $500 million over five years and $1.1 billion over ten years to the Federal government.
The CBO letter explaining the score for this provision was sent to Chairman Stark upon his request. Earlier this year, Orszag testified before the subcommittee that it would be decades before savings would result from comparative effectiveness research.
President Bush Appoints Weems to CMS Acting Administrator
The President appointed Kerry Weems "Acting Administrator" of the Centers for Medicare and Medicaid Services (CMS), despite his pending nomination in the Senate.
The President nominated Weems, a 24-year veteran of the Department of Health and Human Services (HHS), to head the agency in May. The Senate Finance Committee held a confirmation hearing on July 25th but has yet to vote on Weems' nomination.
HHS stated that Weems' appointment to Acting Administrator was not an attempt to bypass the Congressional confirmation process and the Senate Finance Committee plans to proceed, although no timeline for a vote on the nomination has been given.
Upcoming Events
Hearings
Tuesday, September 11, 2007
Universal Health Coverage
Senate Budget Committee
10 a.m., 608 Dirksen
9/11 Health Effects
House Energy and Commerce - Subcommittee on Health
10 a.m., 2123 Rayburn
For More Information
For further information on any topics discussed or publications listed, or to get copies of anything mentioned in this alert, please call 202.466.6550 and ask for the Legislative Practice Group.
Powers Pyles Sutter & Verville PC is a full service law firm specializing in health care and education law and located at
1501 M Street, NW, Seventh Floor, Washington, DC 20005
© Copyright 2007, Powers Pyles Sutter & Verville PC
All rights reserved.
