aamc.org does not support this web browser.
  • Washington Highlights

    President Signs Budget Deal Raising Spending Caps, Delaying DSH Cuts

    Tannaz Rasouli, Sr. Director, Public Policy & Strategic Outreach

    President Trump Feb. 9 signed into law the Bipartisan Budget Act of 2018 (H.R. 1892), the product of bipartisan negotiations to provide sequestration relief over two years for discretionary spending, address a number of expired health care provisions, and temporarily continue funding for the federal government, among other provisions. 

    The agreement – released by Senate leaders Feb. 7 and approved by both the Senate, 71-28, and House, 240-186, in the early hours of Feb. 9 – extends until March 23 the previous continuing resolution, which expired Feb. 8 [see Washington Highlights, Jan. 26]. 

    Appropriators will use the next six weeks to draft the 12 annual spending bills using revised discretionary spending caps that provide $63 billion more for non-defense spending in FY 2018 and $68 billion more in FY 2019, as well as boosting funding for defense. The AAMC and the AAMC-convened Ad Hoc Group for Medical Research have been calling on lawmakers for months to raise the discretionary spending caps to enable robust investments in the National Institutes of Health (NIH) and other health priorities. 

    As part of the agreement, congressional leaders publicly committed to set aside at least $1 billion of the new funding to provide an increase for the NIH for each of FYs 2018 and 2019. Because appropriators will implement the commitment when they draft the forthcoming spending bills, they also will have the opportunity to provide a potentially greater increase for NIH within the confines of the subcommittee’s overall spending allocation for each of those years.  

    The budget package also contains several health related priorities of interest to medical schools and teaching hospitals, including a provision that will delay Medicaid disproportionate share hospital (DSH) cuts by two years, and a provision that provides an additional four years of funding for the Children’s Health Insurance Program (CHIP) [see Washington Highlights, Dec. 22]. The additional four years of funding for CHIP, coupled with the six-year extension of funding included in the last continuing resolution, means that the program will be continuously funded for the next ten years [see Washington Highlights, Jan. 26]. The bill also repeals the independent payment advisory board (IPAB) and incorporates several provisions aimed at streamlining and improving chronic care. 

    Additionally, the legislation extends funding for two Health Resources and Services Administration (HRSA) workforce programs supported by the AAMC. Specifically, the bill extends current funding ($310 million) for the National Health Service Corps for two years, and increases funding for the Teaching Health Centers Graduate Medical Education program, with $126.5 million for each of FYs 2018 and 2019. 

    In a Feb. 9 statement, AAMC President and CEO Darrell G. Kirch, MD, applauded the inclusion of priorities for academic medical centers in the package, noting “The AAMC is very appreciative that lawmakers have come together in a bipartisan fashion to approve a budget deal that will allow for robust investment in agencies and programs vital to our nation’s health security and will help safety net hospitals continue to serve vulnerable populations.” 

    Passage of the bill was unclear because fiscal conservatives were concerned by the package’s overall increased spending while House Democrats expressed objections that House leadership had not provided a commitment to an open floor debate on immigration issues, including Deferred Action for Childhood Arrivals (DACA) and DREAMers.