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Trump Open to VA Caps Exemption, Option for FY21 Progress

May 22, 2020

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Christa Wagner, Senior Legislative Analyst
Brett Roude, Legislative Analyst

Senate Appropriations Committee Chairman Richard Shelby (R-Ala.) expressed optimism about the White House’s receptiveness to addressing a key stumbling block in the fiscal year (FY) 2021 appropriations process following a May 20 meeting with President Donald Trump.

Shelby met with President Trump to discuss exempting funding related to the implementation of the Department of Veterans Affairs (VA) MISSION Act from FY 2021 discretionary spending caps, including funds for health care provided to veterans through VA Community Care Network [see Washington Highlights, March 6]. $11 billion is needed to fund the VA MISSION Act program in FY 2021, in contrast to a $5 billion increase in the nondefense discretionary spending cap from FY 2020.

If MISSION Act spending is not exempt from the cap, Congress would face cutting funding to other nondefense discretionary programs, including health care and medical research funded through the Labor, Health and Human Services, Education, and Related Agencies (Labor-HHS-Ed) bill. Labor-HHS-Ed programs represent one-third of discretionary funding and likely would face substantial cuts if VA does not receive a caps exemption for FY 2021.

The tight budget caps and coronavirus pandemic are impacting progress on the FY 2021 appropriations process. House subcommittees received top-line spending levels, or 302(b) allocations, on April 10 with adherence to the FY 2021 budget caps [see Washington Highlights, April 17], but they have not yet set dates for consideration of FY 2021 spending bills. Following the May 20 meeting, Shelby told reporters that the president “understood the [budget cap] problem” and that appropriators would try to “work the process" toward negotiating a caps exemption to allow the FY 2021 process to proceed.

The AAMC, both through its own testimony and as a part of broader coalitions, has pointed to the challenges associated with the FY 2021 discretionary spending caps and the need to consider exemptions to enable appropriators to invest appropriately in the full array of national priorities.

In response to the Senate Labor-HHS-Ed Appropriations Subcommittee’s call for outside witness testimony, the AAMC submitted its FY 2021 priorities on May 22. The testimony acknowledged the constraints placed on the subcommittee as a result of the FY 2021 discretionary spending caps and urged Congress to exempt key Labor-HHS-Ed programs from the FY 2021 spending caps. The statement also described the importance of investing in the National Institutes of Health (NIH), the Agency for Healthcare Research and Quality, workforce programs administered by the Health Resources and Services Administration (HRSA) including Title VII health professions and Title VIII nursing programs, the Children's Hospitals Graduate Medical Education program, the National Health Service Corps, the Hospital Preparedness Program, and other programs under the subcommittee’s jurisdiction.

The AAMC also thanked Congress for investments that have already been made to support academic medicine during the COVID-19 pandemic. The letter noted that emergency supplemental funding packages “take important steps to provide relief for health care providers and critical safety net providers, including major teaching hospitals and faculty physicians, for both increased clinical spending and losses associated with COVID-19; for expansion of testing capacity and contact tracing; for additional student loan relief and funding for higher education., and for additional COVID-19-related medical research.”

Also submitting testimony was the Ad Hoc Group for Medical Research, a coalition convened by the AAMC that consists of over 330 patient and voluntary health groups, medical and scientific societies, academic and research organizations, and industry organizations that support funding for NIH. In its testimony, the Ad Hoc Group thanked the subcommittee for its support of NIH over the last five years as well as more recent supplemental funding for the agency to combat COVID-19. The Ad Hoc Group recommended $44.7 billion for the NIH in FY 2021, a $3 billion increase over the NIH’s program level funding in FY 2020 “for meaningful growth above inflation in the base budget that would expand NIH’s capacity to support promising science in all disciplines in addition to special initiatives.”

The Ad Hoc Group also shared support for exempting NIH from the FY 2021 spending caps. “We believe that investments in science and innovation are essential if we are to continue to meet current and future health challenges, improve our nation’s physical and fiscal health, and sustain our leadership in medical research,” the testimony stated.

The AAMC-led Health Professions and Nursing Education Coalition (HPNEC) also submitted testimony for the record advocating for $790 million for the HRSA Title VII health professions and Title VIII nursing workforce development programs. The testimony highlighted how the programs are "structured to allow grantees to test educational innovations, respond to changing delivery systems and models of care (such as telehealth), and address health threats, such as COVID-19." Earlier this spring, HPNEC recommended $367 million in emergency supplemental funding for the HRSA Title VII and Title VIII programs in COVID-19 supplemental legislation [see Washington Highlights, May 1].

Neither House nor Senate Labor-HHS-Ed subcommittees have scheduled mark ups of their FY 2021 spending bills. 

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