Washington Highlights: April 27,
2007
Congress Clears FY 2007 Supplemental Appropriations
Contents
Prior Issues
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The House (218-208) April 25 and Senate (51-46) April 26 approved
a final conference report on the emergency supplemental appropriations
legislation (H.R.
1591). The President plans to veto the bill because of provisions
related to the Iraq war.
The conference report includes a one-year delay in the implementation
of the Jan. 18 Medicaid proposed rule regarding cost limits and
units of government. It also delays by one year implementation of
"any rule or provisions restricting payments for graduate medical
education under the Medicaid program." A new Medicaid requirement
to use tamper-resistant prescription pads, as well as an extension
of certain "Pharmacy Plus" waivers, would reportedly offset
the cost of the one-year delays.
In anticipation of the conference, the AAMC signed an April 23
hospital group letter
to House and Senate leadership asking them to assure that the final
report retained Senate-passed language providing for a two-year
delay of the proposed rule and any proposals to reduce Medicaid
funds for graduate medical education. The American Hospital Association,
Federation of American Hospitals, National Association of Children's
Hospitals, National Association of Public Hospitals and Health Systems,
and Premier also signed the letter.
The conference report provides funds to eliminate the "remainder
of fiscal year 2007 funding shortfalls" for the State Children's
Health Insurance Program (SCHIP). According to a joint House and
Senate summary of the conference agreement the funds are capped
at $650 million and will benefit 14 states.
The conference report also provides an additional $32.5 million
for the Department of Veterans Affairs (VA) Medical and Prosthetic
Research program, splitting the difference between the House ($35
million) and Senate ($30 million) proposals. The additional funding
is dedicated for "research related to the unique medical needs
of returning Operation Enduring Freedom and Operation Iraqi Freedom
veterans."
The conference agreement provides $625 million for pandemic flu
preparedness activities at the Department of Health and Human Services,
such as purchasing antivirals, accelerating development of cell-based
vaccines, and establishing high-volume domestic surge capacity.
An additional $25 million is directed to the vaccine compensation
fund established by the Public Readiness and Emergency Preparedness
(PREP) Act (Division C of P.L.
109-148).
The conference agreement also includes language to transfer $49.5
million from the National Institute of Allergy and Infectious Diseases
to the Public Health and Social Services Emergency Fund for advanced
research and development of biodefense countermeasures, as directed
in the Pandemic and All Hazards Preparedness Act (P.L.
109-417). The report also includes language for the transfer
of an additional $49.5 million from the NIH Office of the Director
to the Fund for the same purpose.
The measure also includes language to prevent temporarily the reorganization
or relocation of the Armed Forces Institute of Pathology.
Information:
Christiane Mitchell, Director, Federal Affairs
AAMC Government Relations
cmitchell@aamc.org
(202) 828-0526
Tannaz Rasouli, Senior Legislative Analyst
AAMC Government Relations
trasouli@aamc.org
(202) 828-0525
Matthew Shick, Senior Legislative Analyst
AAMC Government Relations
mshick@aamc.org
(202) 862-6116
AAMC Signs Letter Urging Physician Payment Policy
Changes
The AAMC, along with 85 other provider groups, signed an April
20 letter
urging Centers for Medicare and Medicaid Services (CMS) Administrator
Leslie Norwalk to adopt policy changes that would provide short-term
and long-term resolutions to the problematic physician update methodology.
The policy changes outlined in the letter include applying the
$1.35 billion "Physician Assistance and Quality Initiatives
Fund" to the CY 2008 conversion factor update. The Fund, established
by the "Tax Relief and Health Care Act of 2006" (P.L.
109-432), "will help lower the cost of Congressional action"
needed to lessen the projected 10 percent cut. The Medicare Payment
Advisory Commission (MedPAC) made a similar recommendation in its
March 2007 Report to Congress.
The letter also strongly urges the Administration to reduce the
CY 2008 productivity adjustment to the Medicare Economic Index (MEI)
from 1.45 percent to 0.65 percent. This would match the productivity
adjustment recommended for other Medicare providers. The letter
states, "Surely the Administration does not believe that physicians'…productivity
is increasing at twice the rate of other health care providers."
Reiterating the physician community's belief that CMS should remove
the cost of Part B drugs from the update methodology (retroactive
to the 1996 base year), the letter advises that such action would
"reduce the pressure on Congress to find other offsets."
The letter also reiterates previous recommendations to include national
Medicare coverage determinations in the "law and regulation"
portion of the update calculation. If such action is not possible,
the letter suggests excluding from the calculation for at least
two years all services affected by national coverage determinations.
Information:
Christiane Mitchell, Director, Federal Affairs
AAMC Government Relations
cmitchell@aamc.org
(202) 828-0526
Medicare Trustees Report Issues Funding Warning
The Medicare trustees April 23 released their annual report
on the current status and projected financial condition of the Medicare
program. Of concern for providers and beneficiaries alike is that,
for the first time, a funding warning has been activated. Pursuant
to the 2003 Medicare Modernization Act, a funding warning is triggered
when the trustees make a determination in two consecutive annual
reports that general revenue will make up more than 45 percent of
total Medicare financing within a 7-year period (2007-2013 in this
year's report). This determination was first made in the 2006 report,
which projected that general revenues would exceed 45 percent of
total Medicare financing by 2012. As a result of the funding warning,
the Administration is required by law to propose legislation within
15 days of the next federal budget proposal, due in February 2008,
to bring the funding level below 45 percent. Congress is required
to consider, but does not necessarily have to take action, on the
Administration's proposals.
In a statement released on April 23, Senate Finance Committee Chair
Max Baucus (D-Mont.) noted his concern that "the 'Medicare
funding warning' in this report will prompt the President only to
propose slashing Medicare spending, rather than to focus on the
underlying factors driving costs throughout the health system."
Baucus added, "Any Presidential proposal resulting from this
warning should address the fundamental issues plaguing the system
as a whole: health coverage and health care costs."
The trustees report that the hospital insurance trust fund will
become insolvent by 2019, one year later than predicted in the 2006
report. This is due to a projected increase in payroll tax revenues
and lower benefit expenditures, as compared to the 2006 estimates.
Information:
Diana Mayes, Specialist
AAMC Health Care Affairs
dmayes@aamc.org
(202) 828-0498
NSABB Approves Oversight Framework on Dual Use
Research
The National Science Advisory Board for Biosecurity (NSABB) at
an April 19 meeting
approved a set of recommendations for creating an "oversight
framework" for federally funded biological research with potential
"dual use" applications (e.g., could be intentionally
misused to harm society). The AAMC is closely reviewing the draft
framework, which would create multiple obligations for academic
institutions if implemented. The recommendations result from more
than a year of deliberation, and incorporate guidance instruments
and other elements reported previously. The draft framework document was released one week prior
to the meeting and, as approved, will be sent to federal agencies
for further review toward implementation. Extensive opportunity
for public comments is expected.
Information:
Stephen Heinig, Lead Science Policy Analyst
AAMC Biomedical Health Sciences Research
sheinig@aamc.org
(202) 828-0488
Susan Ehringhaus, Sr. Director & Regulatory Counsel
AAMC Biomedical Health Sciences Research
sehringhaus@aamc.org
(202) 828-0543
Senate, House Pass Science Competitiveness Initiatives
The Senate and the House approved bipartisan legislation this week
seeking to improve national competitiveness in math and the physical
sciences, and authorizing increased appropriations for the National
Science Foundation (NSF).
The Senate April 25 approved, 88-8, the comprehensive "America
COMPETES Act" (S.
761), introduced March 5 by Majority Leader Harry Reid (D-Nev.)
and Minority Leader Mitch McConnell (R-Ky.). The bill authorizes
a doubling of NSF funding to $11.2 billion by FY 2011, while increasing
support for a number of teaching and education programs at NSF.
The measure also authorizes increased appropriations for the Department
of Energy's Office of Science and National Institute of Standards
and Technology (NIST).
The House April 24 approved two less expansive measures, both introduced
Jan. 10 by House Science and Technology Committee Chair Bart Gordon
(D-Tenn.). The "10,000 Teachers, 10 Million Minds Science and
Math Scholarship Act" (H.R.
362), which passed, 389-22, increases authorizations for the
NSF's Robert Noyce Scholarship Program. The program offers grants
to universities to support qualified students who commit to teaching
math and science after graduation. A second bill, the "Sowing
the Seeds through Science and Engineering Research Act" (H.R.
363) requires the NSF to allocate at least 3.5 percent of funds
appropriated for Research and Related Activities (R&RA) to a
grant program for early career researchers and at least 1.5 percent
of the R&RA funds to the existing Integrative Graduate Education
and Research Traineeship Program. The measure passed, 397-20, after
the House adopted an amendment to require the 3.5 percent floor
only if a sufficient number of meritorious grant applications have
been received.
All three bills correspond with the Democratic leadership's Innovation
Agenda and the President's American Competitiveness Initiative (ACI)
to bolster support for research and education in the physical sciences.
In a statement of administration policy, the White House expressed
concern over what it deemed "excessive authorization levels,"
but expressed general support for the bills, and H.R. 362 and H.R.
363 in particular.
Meanwhile, the House Science and Technology Committee April 25
approved by voice vote a bill (H.R.
1867) to reauthorize NSF through 2010. The measure authorizes
funding increases of 7 percent each fiscal year and includes a provision
directing NSF to offer "special consideration" to partnerships
between academia and industry. Another provision requires 30 percent
cost-sharing for major research instrumentation awards to Ph.D.-granting
institutions that are ranked among the NSF's list of top 100 institutions
receiving federal research and development funding.
Information:
Tannaz Rasouli, Senior Legislative Analyst
AAMC Government Relations
trasouli@aamc.org
(202) 828-0525
House Passes Genetic Nondiscrimination Bill
The House April 25 approved the "Genetic Information Nondiscrimination
Act" (H.R.
493), 420-3. The final bill is a compromise of versions approved
by three different committees [see Washington
Highlights, March 30].
The bill would prohibit employers or insurers from collecting or
using genetic information when making decisions related to hiring,
firing, health coverage or insurance premiums.
The Senate Health, Education, Labor, and Pensions Committee Jan.
31 approved its version (S. 358), but Senator Tom Coburn (R-Okla.)
has placed a hold on the bill. It is expected his concerns will
be addressed, and the bill will be passed by the Senate. The President
has stated he will sign the bill.
Information:
Erica Froyd, Director, Public Health and Research Legislative Affairs
AAMC Government Relations
efroyd@aamc.org
(202) 828-0525
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