Washington Highlights: July
20, 2007 House Passes HHS Funding Bill
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The House of Representatives July 18 passed its FY 2008 Labor-HHS-Education
appropriations bill (H.R.
3043) by a vote of 276 to 140 following three days of debate
and votes on dozens of amendments to modify funding for specific
programs. A total of 53 Republicans voted for the bill; the only
Democrat to vote no was Rep. Melissa Bean (Ill.). The House Appropriations
Committee approved H.R. 3043 on July 11 [see Washington
Highlights, July 13]
and filed the committee report (H.
Rpt. 110-231) on July 13.
The AAMC July 17 signed a letter
in in support of the appropriations bill's passage, joining nearly
1100 education, training, disability, public health, health and
biomedical research, aging and child welfare organizations, elected
officials, and labor unions representing the full range of stakeholders
in the programs of the Departments of Education, Health and Human
Services and Labor.
For the National Institutes of Health (NIH), the bill includes
$29.650 billion, an increase of $750 million (2.6 percent) above
the current year's funding level and $1.029 billion (3.6 percent)
above the President's request. However, the bill also increases
the amount of the transfer from NIH to the Global HIV/AIDS fund
from the $99 million in FY 2007 to $300 million in FY 2008, which
means the net increase in the NIH budget is $549 million (1.9 percent)
over FY 2007.
The bill provides $228.3 million for Title VII health professions
programs, a $43.6 million (23.6 percent) increase over FY 2007.
The Title VII Centers of Excellence and Health Careers Opportunity
Programs each receive $28.4 million, for a $16.6 million (139.3
percent) increase and $24.5 million (618.2 percent) increase, respectively.
The primary care medicine and dentistry programs are level funded
at $48.9 million, while the AHECs receive a $2.5 million (8.9 percent)
increase over the current funding level. For the National Health
Service Corps (NHSC), the bill provides $131.5 million, a $5.8 million
(4.6 percent) increase over FY 2007.
The House passed (412-12) an amendment offered by Rep. John Lewis
(D-Ga.) prohibiting funds from being used "to take any action
to finalize (or otherwise implement)" specific proposals included
in the FY 2008 Medicare Inpatient Prospective Payment System (IPPS)
proposed rule published on May 3, 2007. Specifically, the amendment
would prohibit altering hospital payments based on the rule's proposed
Medicare severity diagnosis related group (MS-DRG) system. The amendment
also prohibits the implementation of the proposed prospective "behavioral
offset" related to the MS-DRGs. In its June 12 comment
letter, the AAMC urged CMS to implement the new MS-DRGs over
a 4-year transition and rescind the 2.4 percent behavioral offset.
The House defeated (181-249) an amendment offered by Rep. Joe Barton
(R-Texas) to prevent funds from the bill from being transferred
from NIH under the Secretary's program evaluation authority. A total
of 19 Republicans, including most Republican members of the Labor-HHS
Appropriations Subcommittee, joined 230 Democrats to vote against
the amendment; no Democrats voted for it. Originally authorized
in statute at 1 percent, the appropriators have increased the transfer
authority in recent years to 2.4 percent of the budgets of NIH and
other HHS agencies. The transferred funds are used to support approximately
two-thirds of the budget for the Agency for Healthcare Research
and Quality (AHRQ) as well as the National Center for Health Statistics
and other programs at CDC and the department.
Prior to final passage, the House rejected (206-213) a motion by
Rep. Jerry Lewis (R-Calif.), the ranking member of the House Appropriations
Committee, to recommit the bill to the Appropriations Committee
and a series of amendments offered by Republicans to cut the bill
across-the-board by amounts ranging from 0.25 percent to 4.6 percent.
In a Statement
of Administration Policy (SAP) issued July 17, the White House
said it "strongly opposes H.R. 3043 because, in combination
with the other FY 2008 appropriations bills, it includes an irresponsible
and excessive level of spending and includes other objectionable
provisions." The Administration notes this bill exceeds the
President's request by nearly $11 billion.
The Senate Appropriations Committee approved its FY 2008 Labor-HHS
bill (S.
1710; S.
Rpt. 110-107) on June 21 [see Washington
Highlights, June 22].
No date has been set for floor consideration of the Senate bill.
Information:
Dave Moore, Senior Director
AAMC Government Relations
dbmoore@aamc.org
(202) 828-0525
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
Senate Clears HEA Budget Bill for Conference
The Senate July 19 passed the "College Cost Reduction Act
of 2007" (H.R.
2669), a budget bill that reauthorizes provisions of the Higher
Education Act (HEA) that have an effect on mandatory spending. The
Senate substituted the text of its bill, the "Higher Education
Access Act of 2007" (S.
1762), for the House-passed H.R. 2669. S. 1762 was approved
by the Health, Education, Labor and Pensions (HELP) Committee June
20. [see Washington Highlights,
June 22]. The House
passed their version of the bill July 11 [see Washington
Highlights, July 13].
The AAMC July 11 sent a comment letter to the chairs and ranking
members of the House and Senate education committees regarding the
HEA reauthorization packages. The letter addresses a number of issues
important to medical schools and students, including expanding the
economic hardship deferment, increasing Stafford loan limits, student
loan oversight, and institutional accreditation.
The President threatened to veto the House version of H.R. 2669,
because "it fails to target aid to the neediest students currently
in college and creates new mandatory Federal programs and policies
that are poorly designed and would have significant long-term costs
to the taxpayer." In a July 18 Statement
of Administrative Policy, the White House expressed "serious
concern" with the Senate bill, but stopped short of a veto
threat.
Information:
Matthew Shick, Senior Legislative Analyst
AAMC Government Relations
mshick@aamc.org
(202) 862-6116
House, Senate Panels Approve Patent Reform
The Senate Judiciary Committee July 19 approved (13-5) the "Patent
Reform Act of 2007" (S.
1145). The House Judiciary Committee approved its version (H.R.
1908) by a voice vote on July 18. The bills would significantly
alter the U.S. patent system, replacing the current "first-to-invent"
system with a more objective "first-inventor-to-file"
system.
House Judiciary Subcommittee on Courts Chair Howard L. Berman (D-Calif.),
along with the full committee Ranking Member Lamar Smith (R-Texas),
shepherded through a manager's amendment that stripped a provision
that would have created a "second window" for challenging
patents more than a year after they are granted. Instead, language
in the bill would strengthen the current re-examination process.
The panel approved an amendment, offered by Rep. Hank Johnson (D-Ga.),
to give judges more discretion in apportioning damages in relation
to the overall value of the product, or based on other alternative
factors.
In the Senate, amendments introduced by Sen. Jon Kyl (R-Ariz.)
to expand the ability of challenges to patents after they are granted
and apportion damages according to the patent's contribution to
the overall value of the product were both defeated.
Senate Judiciary Committee Ranking Member Arlen Specter (R-Pa.)
tried to scale back a "best mode" requirement that has
resulted in excessive litigation and unrealistic attempts to discern
the state of mind of an inventor. The amendment was rejected, 9-10.
Sponsors in both chambers hope to consider the patent reform bills
on the floor and in conference by fall.
Information:
Matthew Shick, Senior Legislative Analyst
AAMC Government Relations
mshick@aamc.org
(202) 862-6116
Stephen Heinig, Lead Science Policy Analyst
AAMC Biomedical Health Sciences Research
sheinig@aamc.org
(202) 828-0488
Finance Committee Passes SCHIP Reauthorization
Bill, Raises Medicaid Moratorium
The Senate Finance Committee July 19 approved (17-4) legislation
to reauthorize the State Children's Health Insurance Program (SCHIP).
Describing the "Children's Health Insurance Program Reauthorization
Act" as a "consensus package," Committee Chair Max
Baucus (D-Mont.) thanked Ranking Member Charles Grassley (R-Iowa),
Health Subcommittee Chair Jay Rockefeller (D-W.Va.), and Health
Subcommittee Ranking Member Orrin Hatch (R-Utah) for helping craft
the final language.
According to preliminary
materials from the Congressional Budget Office and Finance Committee,
the 5-year, $35 billion reauthorization agreement preserves the
enrollment of 1.9 million beneficiaries who would likely lose coverage
under current funding levels, enrolls 1.6 million SCHIP-eligible
children not yet in the program, and expands SCHIP eligibility to
1.1 million more children. The funding increase is offset by an
increase in federal tobacco taxes and a series of SCHIP cuts beginning
in FY 2014. The package reconfigures the SCHIP allotment formula,
reduces to 2 years the time states may access their allotments before
redistribution, and establishes an Incentive Bonuses Pool to fund
state Medicaid and SCHIP expansions that exceed "a defined
baseline." The bill also establishes a Contingency Fund for
addressing state funding shortfalls, streamlines the enrollment
process, permits coverage of prenatal care, and transitions SCHIP
parents into new block grants with expenditures matched at the Medicaid
level. Childless adults will be transitioned out of the program.
During the Committee mark-up, Sen. Jeff Bingaman (D-N.M.) offered
and withdrew an amendment to extend the temporary one-year "moratorium"
on the Medicaid final rule regarding cost limits/units of government
and the Medicaid proposed rule "clarifying" that GME costs
and payments are not eligible for Federal matching payments. Chairman
Baucus assured Sen. Bingaman that "we will deal with it"
in the future.
Having viewed the Committee's reauthorization package before the
mark-up, Secretary of Health and Human Services (HHS) Michael Leavitt
July 17 sent a letter to Chairman Baucus warning that President
Bush would veto the legislation. Chairman Baucus responded in a
July 17 letter,
stating that "I am frankly surprised by your opposition"
to the bill.
Information:
Christiane Mitchell, Director, Federal Affairs
AAMC Government Relations
cmitchell@aamc.org
(202) 828-0526
Congressional TriCaucus Introduces Health Disparities
Bill
Rep. Hilda Solis (D-Calif.) July 12 introduced the Congressional
TriCaucus-sponsored "Health Equity and Accountability Act of
2007" (H.R.
3014), which seeks to reduce health disparities and improve
racial and ethnic health equity. The bill includes provisions to
enhance health workforce diversity, culturally and linguistically
appropriate care, and data collection and analysis. The Senate "Minority
Health Improvement and Health Disparity Elimination Act" (S.
1576) contains some similar provisions [see Washington
Highlights, June 15].
Of particular interest to academic medicine, the House bill:
- Reauthorizes the National Health Service Corps and certain Title VII
health professions programs, including the Centers of Excellence,
Health Careers Opportunity Program, and Area Health Education Centers;
- Adds to Title VII a program authorizing grants to community health
centers to establish or expand accredited medical residency training
programs;
- Requires health professions schools to collect and report annually
to the Secretary data on race, ethnicity, and language proficiency
of enrolled students; and
- Reauthorizes and strengthens the National Center for Minority Health
and Health Disparities' oversight of NIH research related to health
disparities.
The Congressional TriCaucus is comprised of the three House minority
caucuses. In announcing the bill, Rep. Solis, who chairs the Congressional
Hispanic Caucus Task Force on Health and the Environment, was joined
by Rep. Madeleine Bordallo (D-Guam), chair of the Congressional
Asian Pacific American Caucus Health Task Force, and Rep. Donna
Christensen (D-V.I.), chair of the Congressional Black Caucus Health
Braintrust. The measure was referred to the Committees on Energy
and Commerce, Ways and Means, Education and Labor, Natural Resources,
and the Judiciary.
Information:
Tannaz Rasouli, Senior Legislative Analyst
AAMC Government Relations
trasouli@aamc.org
(202) 828-0525
CMS Proposes Payment Changes for Hospital OPPS
and Ambulatory Surgical Centers
The Centers for Medicare and Medicaid Services (CMS) July 16 posted
on its website a proposed
rule that contains changes to the outpatient prospective payment
system (OPPS) as well as proposed payment rates for Ambulatory Surgical
Centers (ASC). At the same time, the agency published a final
rule that contains other changes to the ASC payment system.
Both rules are scheduled to be published in the Federal Register
on Aug. 2 and will be implemented Jan. 1, 2008.
CMS proposes to raise the base OPPS payment rate by the full market
basket increase of 3.3 percent. Due largely to the packaging proposals,
CMS estimates that major teaching hospitals would see an overall
average increase in OPPS payments of 3.5 percent in 2008, compared
to a 3.3 percent increase for minor teaching hospitals and 3.7 percent
increase for non-teaching hospitals.
The proposed rule would increase the number of services included
under a single Ambulatory Payment Classification (APC) group. While
some services that are provided during an outpatient visit currently
are "packaged" with the primary outpatient procedure described
below, a number of other services that are provided during the same
visit are paid under separate APCs. CMS is proposing to "package"
more of these services together, decreasing the number of APCs for
which a hospital would be paid. CMS estimates that the net impact
of the proposed changes would have no effect on overall payments
to hospitals, but major teaching hospitals would see a slight increase.
On the hospital outpatient quality front, CMS is proposing to implement
the hospital outpatient quality reporting program. The program was
spurred by an amendment to the "Tax Relief and Health Care
Act of 2006" (P.L.
109-432), which included a requirement that hospitals must submit
quality data on hospital outpatient departments to CMS. Failure
to provide the information will result in a reduction of their annual
payment update factor of 2.0 percentage points. The quality reporting
program would function similarly to the inpatient prospective payment
system (IPPS) reporting program and would utilize the same data
submission and validation requirements. Hospitals would be required
to submit data for discharges beginning Jan.1, 2008. CMS has proposed
ten measures for the initial program year that focus on Emergency
Department transfers, Perioperative care, Community Acquired Pneumonia
and Diabetes care. CMS also has included a list of thirty measures
that are being considered for future years.
The ASC final rule includes major revisions to the ASC payment
system to be implemented starting Jan. 1, 2008. The final rule adds
about 790 procedures for ASC payment, many of which are currently
performed in physician's offices. Payment rates for services performed
in ASCs are included in the OPPS/ASC proposed rule and would be
phased-in over a 4-year period, with full implementation taking
place in CY 2011.
Comments on the proposed rule are due Sept. 14, 2007.
Information:
Diana Mayes, Specialist
AAMC Health Care Affairs
dmayes@aamc.org
(202) 828-0498
House Science Committee Considers Future of Bayh-Dole
The House Science and Technology Subcommittee on Technology and
Innovation July 17 held a hearing
on technology transfer at universities. Entitled "Bayh-Dole:
the Next 25 Years," the hearing focused on the "Patent
and Trademark Law Amendments Act of 1980" (P.L.
96-517), more commonly known as "Bayh-Dole," which
guides universities in retaining title to intellectual property
arising from federally sponsored research. Witnesses agreed that
changes in institutional or agency implementation of Bayh-Dole are
preferable to amending the statute.
Subcommittee Chair David Wu (D-Ore.) presided, joined by Ranking
Member Phil Gingrey, M.D. (R-Ga.). Witnesses included:
- Arundeep Pradahn, Director of Technology and Research Collaborations
at Oregon Health Sciences University and director of the Association
of University Technology Managers (AUTM);
- Susan Butts Senior Director of External Science and Technology Programs,
Dow Chemical Company and a participant on the federal Government University
Industry Research Roundtable;
- Wayne Johnson, Vice-President, Worldwide University Relations, Hewlett-Packard
Corp.;
- Mark Lemley, Director of the Stanford University Program in Law, Science
& Technology; and
- Mark Allen, Professor, Electrical and Computing Engineering, Georgia
Institute of Technology and a co-founder and Chief Technology Officer
of CardioMEMS, Inc, a medical device company.
As noted by Mr. Pradhan, under Bayh-Dole university-based inventions
have resulted in more than 28,000 active licenses and more than
5,000 spin-off companies, contributing to the creation of over 260,000
jobs. There was general agreement among the witnesses that the economic
circumstances motivating the original legislation have changed substantially,
though concerns about U.S. competitiveness in a global economy remain
a central issue.
Dr. Butts, Mr. Johnson, and Dr. Lemley, while generally laudatory
of the overall effects of Bayh-Dole, criticized universities as
increasingly difficult partners in research collaborations with
industry. A central impediment, according to the witnesses, is the
disposition of property rights from such collaborations. Mr. Johnson
stated in particular that it is often easier for information technology
companies to collaborate with universities in other countries.
None of the witnesses recommended legislative changes to Bayh-Dole,
but called instead for changes in institutional or agency behaviors
implementing the statutes. Chairman Wu noted that the subcommittee
would in the near future review the Stevenson-Wydler Act, which
governs collaborations between industry and federal laboratories.
Information:
Matthew Shick, Senior Legislative Analyst
AAMC Government Relations
mshick@aamc.org
(202) 862-6116
Stephen Heinig, Lead Science Policy Analyst
AAMC Biomedical Health Sciences Research
sheinig@aamc.org
(202) 828-0488
VA Secretary Resigns
Secretary of Veterans Affairs Jim Nicholson July 17 announced he
has tendered his resignation to President George W. Bush, effective
no later than Oct. 1, 2007. Secretary Nicholson plans to return
to the private sector, though indicated he has no definite plans.
Secretary Nicholson, a Vietnam Veteran, was sworn in to his current
position on Feb. 1, 2005.
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