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Learn about policy issues important to medical schools and teaching hospitals, with Executive Vice President Atul Grover, M.D., Ph.D.

Washington Highlights

House Budget Chair Releases FY 2015 Republican Budget Proposal

April 4, 2014—The House Budget Committee April 2 passed (22-16) the Republican Fiscal Year (FY) 2015 budget resolution, also known as “The Path to Prosperity.” Introduced by Budget Committee Chair Paul Ryan (R-Wis.) April 1, the proposal would cut overall spending by $5.1 trillion over the 10 year budget window and balance the federal budget by 2024.

The Republican budget recycles many of the health care savings proposals from previous budgets including repealing the Affordable Care Act (ACA, P.L. 111-148 and P.L. 111-152) and fundamentally reforming the Medicare and Medicaid programs.

Chairman Ryan opened the House Budget Committee markup explaining the reasoning behind putting forth a budget resolution just months after Congress passed the Bipartisan Budget Act (P.L. 113-67) stating, “The agreement was a step in the right direction. But it didn’t go far enough. It didn’t do enough to address the driver of our debt: autopilot spending. And it didn’t do enough to get our economy growing again.”

He further commented on the President’s FY 15 budget request saying it “never balances” and adding, “[O]ur budget, on the other hand, balances in ten years. And it puts us on the path to pay off our debt” [see Washington Highlights, Mar. 7].

In his opening statement, Ranking Member Chris Van Hollen (D-Md.), expressed his dissatisfaction with the budget proposal saying, “The President has presented a budget that will help boost job growth, sharpen America’s competitive edge, and expand opportunity. Now we have the Republican budget. Of all the reckless budgets our Republican colleagues have introduced, this one is the worst for America.” He later criticized Republicans continued efforts to repeal the ACA and alter the Medicare and Medicaid programs.

The Republican budget achieves more than $2 trillion in savings through repeal of the ACA, including $1.2 trillion in savings from elimination of the ACA insurance exchange subsidies and $793 billion from repeal of the Medicaid expansion. The ACA repeal also would eliminate the Independent Payment Advisory Board (IPAB) which Republicans characterize as “the health care law’s new rationing board.” While the budget alludes to a replacement of the health care law, no details or proposals are outlined.

Even as the Republican budget proposal repeals the ACA, it retains the ACA’s Medicare cuts and directs “any potential Medicare savings in current law toward shoring up Medicare.” Additionally, the proposal includes $139 billion in additional Medicare savings by transforming Medicare into a “premium support” model, enacting medical liability insurance reform, and increasing means-testing for high-income seniors. Finally, the budget includes $732 billion in Medicaid savings achieved by transforming Medicaid into a block grant program.

As expected, the Ryan budget sticks to the FY 2015 discretionary spending caps, not breaking the firewall he set up with Senate Budget Committee Chair Patty Murray (D-Wash.) between defense and nondefense. But the Ryan budget breaks the firewall starting in FY 2016 – where the overall discretionary cap is held at the sequester level, defense is increased by $43 million, and nondefense discretionary is cut by a commensurate amount.

The full House is expected to consider the budget the week of April 7, while Senate leaders have indicated they do not intend to take up an FY 2015 budget resolution.

Contact:

Len Marquez
Director, Government Relations
Telephone: 202-862-6281
Email: lmarquez@aamc.org

Courtney Summers
Senior Legislative Analyst
Telephone: 202-862-6042
Email: csummers@aamc.org

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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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For More Information

Jason Kleinman
Sr. Legislative Analyst, Govt. Relations
Telephone: 202-903-0806
Email: jkleinman@aamc.org