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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

Secretary Price Testifies at Senate and House Hearings on FY 2018 HHS Budget Proposal

June 9, 2017—Health and Human Services (HHS) Secretary Tom Price, MD, testified June 8 in front of both the Senate Finance Committee and House Ways and Means Committee about the department’s fiscal year (FY) 2018 budget. While the proposed budget does not cut Medicare, it contains substantial reductions in funding to Medicaid, the Centers for Disease Control and Prevention (CDC), and the National Institutes of Health (NIH), among other HHS programs. Because of these cuts, members of Congress of both political parties have indicated that the budget is dead on arrival on Capitol Hill.

In his opening remarks in front of the Senate Finance Committee, Secretary Price defended the budget, saying, “President Trump’s budget does not confuse government spending with government success…The problem with many of our federal programs is not that they are too expensive or too underfunded. The real problem is that they do not work – they fail the very people they are meant to help.”

Medicaid was a heavy focus of the hearing, with Secretary Price defending the massive cuts to the program. “If how much money the government spends on a program were truly a measure of success, Medicaid would be hailed as one of the most successful in history. Twenty years ago, annual government spending on Medicaid was less than $200 billion; within the next decade, that figure is estimated to top $1 trillion. Despite these significant investments, one-third of doctors in America do not accept new Medicaid patients. Some research has shown that enrolling in Medicaid does not necessarily lead to healthier outcomes for the newly eligible Medicaid population.”

In his remarks, Chairman Orrin Hatch (R-Utah) warned against assuming that Medicaid proposals contained in the American Health Care Act (AHCA, H.R. 1628) would be enacted. He said, “Despite some insinuations to the contrary, the budget does not incorporate the specific legislative proposal – the American Health Care Act – that is before Congress right now. Therefore, it is not accurate to associate the specific Medicaid savings the CBO has estimated from enactment of the AHCA with the President’s budget. To do so would assume a level of specificity that, for obvious reasons, is just not there. Moreover, the President’s budget does not cut $1.5 trillion from Medicaid. Nor does it assume that the specific Medicaid-reform proposals from the AHCA will be enacted into law…And, any Senator who harps on the AHCA Medicaid numbers here today either does not understand the explicit language and estimates provided in the President’s budget, or they are simply attempting to muddy the waters in order to scare Americans who rely on Medicaid for healthcare coverage.”

Ranking Member Ron Wyden (D-Ore.) pushed back against those assertions stating, “When asked if his proposed cuts would result in millions of Americans losing access to Medicaid, he responded, ‘Absolutely not.’ He went further, claiming ‘there are no cuts to the Medicaid program’…Here’s the bottom line on Medicaid. Seventy-four million Americans rely on this program for health coverage. Parents with sick kids, people with disabilities, seniors in nursing homes who have nobody to turn to for help if their benefits disappear, and thousands of Oregonians who are healthier under my home state’s model. It would be a tough sell to convince those people that they’re worse off being enrolled in Medicaid, or that the program needs more than a trillion dollars in cuts.”

Secretary Price also testified June 8 during a House Energy and Commerce Committee hearing on the HHS FY 2018 budget request. In his opening statement, Chairman Kevin Brady (R-Texas) noted he was pleased to see many of the Committee’s priorities reflected in President Trump’s budget proposal and added that the proposal “reflects a meaningful step toward improving America’s health care system.”

Ranking Member Richard Neal (D-Mass.) highlighted the president’s proposed cuts to Medicaid, which he said “would put at great risk health insurance for kids, long-term care for seniors, and individuals who rely on mental health and opioid addiction programs.” He continued, “The cuts would harm hospitals because they would take on significant uncompensated care but with lower reimbursement rates. This is a recipe for a health and economic disaster for not just Medicaid, but for all Americans.”

In his testimony, Secretary Price defended the proposed Medicaid cuts by pointing out that “mixed impact of Medicaid coverage on health outcomes suggests we need structural reforms that equip States with the resources and flexibility they need to serve their unique Medicaid populations in a way that is as compassionate and as cost-effective as possible…Over the next decade, these reforms will save American taxpayers an estimated $610 billion. They will achieve these savings by harnessing the innovative capacity of America’s governors and state legislators who, informed directly by the people and those providing the services, have a proven record of developing creative, effective ways to meet the healthcare needs of friends and neighbors in need, while empowering them to manage their own health.”

During the hearing, Health Subcommittee Ranking Member Sandy Levin (D-Mich.) expressed concern over the budget proposal’s cuts to the National Institutes of Health (NIH). Rep. Levin highlighted breakthroughs in four areas of medical research due to NIH funding: Hepatitis C, cystic fibrosis, AIDS, and cancer research.

Contact:

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

Catie Spivey, JD
Sr. Legislative Analyst, Gov't Relations
Telephone: 202-862-6042
Email: cspivey@aamc.org

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