Senate Conferees Agree on Offsets for Farm Bill That Do Not Include Reduction in Medicare Coverage for Oxygen Equipment

Democratic and Republican Senate Finance Committee members who also serve as conferees on the farm bill have agreed on a $12 billion package of offsets to offer House conferees and the Bush administration that does not include a provision to reduce Medicare coverage for certain medical equipment, according to an individual familiar with the situation, CongressDaily reports. According to the individual, the package includes $8 billion in spending reductions and $4 billion in revenue increases.

The package includes some of the offsets proposed by the Bush administration but not a provision that would reduce Medicare coverage for oxygen equipment, the individual said (Hagstrom, CongressDaily, 3/5).

One of the offsets proposed by the Bush administration would save $6.8 billion over 10 years through a reduction in Medicare reimbursements for oxygen equipment. Under current Medicare regulations, the program covers 36 months of oxygen for beneficiaries after they leave the hospital. Under the proposed offset, Medicare would cover only 13 months of oxygen (Kaiser Daily Health Policy Report, 3/4).

"It is unclear how the $12 billion finance package will fit with the agreement by House and Senate farm leaders and the Bush administration to a $10 billion increase over the farm bill baseline over 10 years," CongressDaily reports. The Bush administration has expressed support for the spending reductions but not for the revenue increases included in the package, and House Ways and Means Committee Chair Charles Rangel (D-N.Y.) has not said whether he would support the package, the individual said.

Senate Finance Committee ranking member Chuck Grassley (R-Iowa) on Tuesday told reporters in a telephone conference call that the committee plans to consider several offsets proposed by the Bush administration, such as a provision that would extend an online Medicaid demonstration project (CongressDaily, 3/5). That offset would save $4.3 billion over 10 years (Kaiser Daily Health Policy Report, 3/4).