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Sec. Sebelius Testifies Before House Ways And Means Committee on President’s FY 15 Budget

March 14, 2014—Secretary of Health and Human Services (HHS) Kathleen Sebelius March 12 testified before the House Ways and Means Committee on the president’s fiscal year (FY) 2015 HHS budget proposal, which calls for $402 billion in health-related cuts over 10 years. The administration proposes $354 billion in Medicare provider cuts, including nearly $15 billion in Medicare Indirect Medical Education (IME) payments, $68 billion in Medicare structural reforms, and $7 billion in Medicaid savings [see Washington Highlights, March 7, 2014].

In her opening testimony, Sec. Sebelius highlighted the administration’s proposed new “Targeted Support for Graduate Medical Education” grant program, part of health care workforce proposals included in the president’s budget that the secretary described as their attempt to “ensure rural communities and other underserved populations have access to doctors and other providers.”

The program would be administered by the Health Resources and Services Administration (HRSA), and between FY 2015 and FY 2024, $5.2 billion in Medicare Hospital Insurance Trust Fund dollars would be transferred to the HRSA grant program. Teaching hospitals, children’s hospitals, and community-based consortia of teaching hospitals and/or other health care entities would be eligible to compete for the grants to support ambulatory and preventive care training positions.

Rep. Joe Crowley (D-N.Y.) applauded the administration for including proposals to address future health care workforce issues, but cautioned that using Medicare cuts from one program, such as Medicare IME payments, to pay for new proposals will create more harm than good.

He stated, “I’m concerned that some of the proposals in this budget would fundamentally change this long standing contract of how doctor training is supported in our country. Our nation has long recognized the need for doctor training to be a shared investment between our medical schools, residency training programs, and the federal government. Medical schools have increased graduating classes, and teaching hospitals are training residents above and beyond what Medicare supports.”

Rep. Crowley also highlighted his bipartisan legislation, the Resident Physician Shortage Reduction Act of 2013 (H.R. 1180), as a means to address the physician shortage and increase residency training positions, stating, “there is a clear and obvious demand for more residency slots, even within the Medicare program, demonstrating that this is not the time to be drawing teaching dollars away from Medicare to other programs.”

Rep. Crowley continued, “I don’t think this is the time to be taking away those monies, we need to be adding money to produce the number of physicians we are going to need in lieu of the Affordable Care Act.”

In his opening statement, Ways and Means Committee Chair Dave Camp (R-Mich.) highlighted many concerns with the ACA, the launch of the health care exchange website. He also specifically stressed his worry regarding the future of Medicare, stating, “Notably missing from this budget is any mention on how we can secure the promise of Medicare for seniors in the future. In just a few short years, Medicare will go broke.”

Ranking Member Sander Levin (D-Mich.) expressed frustration in his opening statement regarding recent GOP discussion of using the savings from an ACA individual mandate delay as an offset for SGR repeal and replacement legislation, saying, “Instead of dialogue, what we've really had from the Republicans is diatribe. And we're going to see that further this week when there's an effort to take up our reform of SGR that's on a bipartisan basis, and fund it with essentially the destruction of the Affordable Care Act.”


Len Marquez
Director, Government Relations
Telephone: 202-862-6281

Courtney Summers
Senior Legislative Analyst
Telephone: 202-862-6042


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Washington Highlights, a weekly electronic newsletter, features brief updates on the latest legislative and regulatory activities affecting medical schools and teaching hospitals.

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Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806