Bush Proposes Health Spending Boost in Budget Plan

The $1.96 trillion budget package that President Bush unveiled on Feb. 28 contains several provisions for health care spending, including a 5.2% boost for HHS, the Washington Post reports. Under the proposed budget, HHS would receive an additional $21 billion for Medicare, including $11 billion for Bush's "Immediate Helping Hand" prescription drug benefit package for low-income seniors, and $10 billion for increased reimbursements to hospitals and other health care providers (Kaufman, Washington Post, 3/1). The proposal also includes an additional $156 billion this year and over 10 years for Medicare reform (Rovner, CongressDaily, 2/28). In addition, the budget would "continue the steep rise" in NIH funding, raising the agency's budget by $2.8 billion, or 13.6%, to $23.1 billion (Washington Post, 3/1). The NIH may use the funding to finance new grants and to back some "one-time activities," such as "high-priority construction and renovation projects" (HHS release, 2/28). While Bush called the NIH funding boost part of a "presidential initiative to double NIH's funding level by 2003," CongressDaily reports that the increase "actually falls short" of the 15% required to reach that target, according to congressional estimates (Rovner, CongressDaily, 2/28).

Other Programs
In addition, Bush has proposed a $111 million hike for substance abuse treatment services, including $100 million for the Substance Abuse and Mental Health Services Administration to help "close the treatment gap." The increase would include $60 million for block grants to states to help fund treatment programs and $40 million for "Targeted Capacity Expansion" grants to support a "rapid, strategic response to emerging trends in substance abuse." Bush also included a provision in the budget that would provide a $124 million increase for community health centers, the first installment of a "multi-year" plan to increase the number of CHCs by 1,200 (HHS release, 2/28). However, Bush's budget also included several "unspecified cuts" to programs to help train health professionals and a provision that would eliminate the $125 million Community Access Program, established by the Clinton administration "to better integrate the delivery of health care services." The Bush administration has also "tak[en] initial steps to further address" a loophole in Medicaid upper payment limits that cost the federal government about $2 billion in FY 2000 (CongressDaily, 2/28).

The Waiting Game
CDC officials said that they hoped Bush would support the agency's 10-year, $1 billion "master plan" to upgrade facilities in Atlanta, but they declined to comment on the budget "until the agency could study its breakdowns in detail." The CDC also hopes to receive funding for some of the agency's "higher-profile" programs, such as a joint effort with the NIH to combat bioterrorism, a project that received $540 million in FY 2001 ( Atlanta Journal-Constitution, 3/1).

Picking the 'Lock Box'
Meanwhile, the Bush administration acknowledged yesterday that the president plans to use the Medicare trust fund's $526 billion surplus to finance half of his $1 trillion "contingency fund," which he proposed for "emergencies or additional spending needs," the Baltimore Sun reports. Bush's budget proposal also "threatens to undermine" a congressional consensus in recent years that lawmakers should not use Medicare surpluses to "underwrite spending on other programs." Just two weeks ago, the House voted 407-2 to place Medicare surplus funds in a "lock box," but now the funding "appears more vulnerable," with Bush poised to "pick the lock" and use the surplus for the contingency fund. According to White House Budget Director Mitch Daniels, the administration may use the contingency fund to help finance a missile defense system. However, Daniels said that Medicare, which "relies heavily" on revenue from other sources, "actually has no surplus." Senate Budget Committee Chair Pete Dominici (R-N.M.) said of Bush's budget proposal, "All we can tell you is the president said [the Medicare surplus is] not going to be used for anything but Medicare, and when we get finished that's what's going to happen to it. Then we can look out to our seniors and say, 'Another red herring'" (Hosler, Baltimore Sun, 3/1).