Some Lawmakers Criticize President Bush’s Budget Proposal, Reject Cuts to Medicare, Medicaid

Senate Democrats and administration officials on Tuesday "sparred" over "unrealistic assumptions" on health care spending and other issues related to the fiscal year 2009 budget request that President Bush released on Monday, CQ Today reports (Clarke/Higa, CQ Today, 2/5). According to the AP/Philadelphia Inquirer, "lawmakers made it plain that they would ignore the president's proposals to cut Medicare and Medicaid spending" (Taylor, AP/Philadelphia Inquirer, 2/6).

During a Senate Budget Committee hearing, White House Office of Management and Budget Director Jim Nussle discussed provisions in the budget request that would seek to reduce spending and growth in entitlement programs, such as Medicare and Medicaid. "Democrats have criticized those proposals, and Nussle challenged them to put their own ideas on the table," CQ Today reports (CQ Today, 2/5). Nussle appeared "combative" during the hearing, "returning criticism of the budget with attacks on lawmakers ... and challenging them to join Bush in curbing the rapid growth of benefit programs," according to the AP/Inquirer (AP/Philadelphia Inquirer, 2/6).

Treasury Department Secretary Henry Paulson also discussed the provisions during a Senate Finance Committee hearing. Sen. Pat Roberts (R-Kan.) criticized provisions that would reduce Medicare reimbursements for physicians and other health care providers (CQ Today, 2/5). He said, "The Medicare cuts are not realistic," adding, "I urge you to take another look at that, 'cause it's just not gonna happen" (Hess, CongressDaily, 2/5). Committee Chair Max Baucus (D-Mont.) said, "A realistic budget would reveal the surprising truth that the long-run problem is not an entitlements problem," adding, "It's a health care problem" (CQ Today, 2/5).

CQ HealthBeat on Tuesday examined reaction to health care provisions included in the budget request. According to CQ HealthBeat, although the budget request received support from a few health care industry groups and congressional Republicans, "it was pretty much all downhill from there."

The "budget and the reaction it caused clarifies that any effort to go after entitlement costs will entail intense political controversy by touching on major spending reductions, benefit changes or tax increases, or some combination of those factors," CQ HealthBeat reports (Reichard, CQ HealthBeat, 2/5).

Family Planning Funding
The proposed budget would cut an estimated $3.3 billion in federal funding over five years for family planning services under Medicaid, BNA reports. Under the proposal, the federal government would align the match rates with a state's regular medical assistance percentage.

The Medicaid cuts would "drastically limit the ability of already cash-strapped states to maintain current levels of health insurance coverage, potentially forcing them to increase cost sharing, cut provider payments and/or reduce benefits," House Energy and Commerce Committee Chair John Dingell (D-Mich.) said in a statement. He added, "The proposed Medicaid cuts include $14.6 billion in cuts as a result of regulatory actions taken by this administration to rewrite program rules that have been unchanged by Congress in more than a decade" (BNA, 2/5).

Bush's proposal also provides $300 million for the Title X family planning program in FY 2009, the same level as FY 2008. The proposal includes level funding requests for the Title V abstinence-only education program and Adolescent Family Life Act programs. Bush proposed a $27.7 million funding increase for HHS' Community-Based Abstinence Education Program, which would bring total funding for the program to $141 million, and his abstinence education funding requests total $204 million, the same figure he requested in FY 2008 (President's budget, 2/4).

FDA
In other budget news, House Democrats are "bypassing FDA to score a budget proposal that reflects what they consider the real needs of the agency" after the budget request "left them scratching their heads," CongressDaily reports.

In a letter on Monday, House Oversight and Government Reform Committee Chair Henry Waxman (D-Calif.) and Dingell asked the FDA Science Board subcommittee on science and technology to determine the amount of funds required to modernize the agency. They wrote, "We are deeply concerned that the budget submitted by the president is grossly inadequate to meet the many challenges at FDA as identified by the Science Board," adding, "It barely covers the cost of inflation and continues the trend of the inadequate budgets of previous years that have led to the current crisis at the agency."

Gail Cassell, chair of the subcommittee and vice president of scientific affairs at Eli Lilly, on Tuesday said she plans to involve as many members as possible to meet the request from lawmakers, although she did not provide a timeline. Asked whether FDA requires more funds than the budget request would provide, Cassell said, "Absolutely. No question about it" (Edney, CongressDaily, 2/6).

Opinion Piece
The U.S. can "maintain spending on valued domestic programs, preserve Social Security and Medicare, the Bush tax cuts and whittle the federal operating deficit to more reasonable levels" through a "modest amount of shared sacrifice and a willingness to ignore the scare tactics of special interest groups," Steven Pearlstein writes in a Washington Post opinion piece.

According to Pearlstein, "Medicare and Medicaid present the most difficult budget challenge." He recommends that lawmakers "limit the percentage of growth in spending for these programs each year to the growth in national income -- and leave it" to the Medicare Payment Advisory Commission to "make the best use of that fixed -- but still generous -- budget." He writes, "Relying on MedPAC would free these programs from the political influence of the special interests -- providers, drug makers, insurers, advocates for the poor and the elderly -- who have fought off all attempts to rein in runaway entitlement spending."

In addition, among other proposals, Pearlstein recommends that lawmakers require military families and retirees to "make modest copayments on their health insurance and Medigap policies," a proposal that "could easily save $2 billion a year." He also recommends that lawmakers limit the tax deductibility of employer-sponsored health insurance.

He concludes, "I can't say whether this modest proposal would solve the federal budget crisis once and for all. What I can say is that they'd get us a heck of lot closer than where we are now -- which, as far as I can tell, is nowhere" (Pearlstein, Washington Post, 2/6).

Broadcast Coverage
C-SPAN's "Washington Journal" on Tuesday included a discussion with HHS Secretary Mike Leavitt about provisions in the budget request that would seek to reduce spending and growth in entitlement programs ("Washington Journal," C-SPAN, 2/5). Video of the segment is available online.