Congressional Corner

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July 13, 2017

Federal Budget Update 
At 4:30 p.m. today the House Labor, Health and Human Services and Education Subcommittee is scheduled to mark up its version of the FY18 appropriations bill. Below is a summary of the funding proposals included in the bill:

HHS – The bill includes a total of $77.6 billion for HHS, a decrease of $542 million below last year’s enacted level and $14.5 billion above the President’s budget request.

CDC – The legislation includes a total of $7 billion for CDC, which is $198 million below the FY17 enacted level and $1 billion above the President’s budget request. This includes $840.6 million in transfers from the Prevention and Public Health Fund. The bill also continues the longstanding prohibition against using federal funds to advocate or promote gun control.

  • Funding within the CDC includes $1.45 billion for CDC’s Public Health Preparedness and Response programs—an increase of $45 million. This will ensure that the Strategic National Stockpile and State and Local Preparedness capacity are adequate. These programs provide supplies and response efforts in the event of a bioterror attack or pandemic disease emergency.
  • The House bill proposes to eliminate the CDC Climate Change program.

Substance Abuse and Mental Health Administration (SAMHSA) – The bill funds SAMHSA at $3.5 billion, which is $306 million below the FY17 enacted level and $68 million above the President’s request. The legislation maintains a prohibition on federal funds for the purchase of syringes or sterile needles, but allows communities with rapid increases in HIV and hepatitis cases to access federal funds for other activities, including substance use counseling and treatment referrals.

SAMHSA funding includes:

  • $1.86 billion for the Substance Abuse Block Grant – the same as the FY17 enacted level and $3.4 million above the President’s budget request.
  • $78 million for criminal justice activities – equal to the FY17 level, including $60 million specifically for drug courts.
  • The bill includes $747 million to address opioid and heroin abuse, which is the same as the FY17 enacted level and $44 million above the President’s budget request. This amount includes $500 million for the state response grants authorized in the 21st Century Cures Act, along with funding for programs authorized in the Comprehensive Addiction and Recovery Act.

HRSA – The bill includes $5.8 billion for HRSA, which is $398 million below the FY17 enacted level and $277 million above the President’s budget request. The amount includes:

  • $300 million for the Children’s Hospital Graduate Medical Education, the same as the FY17 enacted level.
  • $103.5 million for the Healthy Start program and $642 million for the Maternal and Child Health Block Grant – the same as the FY17 enacted level.
  • An elimination of all funding ($300 million) for the Family Planning (Title X) Program.

Agency for Healthcare Research and Quality (AHRQ) – The recommendation provides $300 million for AHRQ, which is $24 million below the FY17 enacted level. The budget request proposed to merge most of AHRQ’s activities into the National Institutes of Health.

Centers for Medicare and Medicaid Services (CMS) – The recommendation provides $3.5 billion for CMS administrative expenses, which is $219 million below the FY17 enacted level and $137 million below the FY18 request. This level is sufficient to maintain core operations and services. The bill does not include additional funding to implement ACA programs, prohibits funds for the Navigators program, and prohibits the collection of user fees from the Health Insurance Exchanges.

The accompanying report, which provides additional information about various programs within CDC, is expected to be released within the next week. ASTHO will provide additional information about the bill as soon as it is available. Please note that the Senate is expected to mark up its version of the bill after the August recess.

302(b) Allocations for House Subcommittees 
According to the Coalition for Health Funding, the House Appropriations Committee is expected to adopt the 302(b) allocations for the 12 annual spending bills. The Coalition’s summary can be found here. A 302(b) allocation is the amount of funding available for the subcommittee to allocate to each agency in their bill.

Importantly, while the chart indicates the overall cut for the House Labor, Health and Human Services and Education Subcommittee 302(b) allocation is approximately $3 billion, budget experts estimate the cut to be closer to $5 billion. The bottom line is that due to the continued austere funding environment, it will be difficult to increase funding for public health programs.

Other Appropriations Bills
On July 12, the House Appropriations Committee released the FY18 Interior and Environment Bill.

EPA is funded at $7.5 billion, a reduction of $528 million below the FY17 enacted level and $1.9 billion above the administration’s request. According to a summary provided by the committee, “The bill proposes to reshape the agency’s workforce by providing resources to offer buyouts and voluntary separation agreements to employees.” The bill also includes language authorizing the EPA administrator and the Secretary of the Army to withdraw the Waters of the United States rule.

The legislation also proposes $72.78 million for the Agency for Toxic Substances and Disease Registry, a decrease of $1.9 million from FY17 enacted levels of $74.691 million.

House Passes FDA User Fee Bill 
Today, the House approved the FDA Reauthorization Act of 2017 (H.R. 2430) by a voice vote. This legislation authorizes FDA to collect user fees from prescription drug and medical device industries. The bill prioritizes approval of certain generic drugs. The Senate needs to pass this bill before the end of July to avoid FDA sending layoff notices to some employees whose salaries are paid by the user fees. Before voting on this bill, however, the Senate needs to finish work on healthcare reform. ASTHO will monitor the progress of this bill.

Agriculture Bill Released 
The House Appropriations Committee released the FY18 Agriculture, Rural Development, Food and Drug Administration Appropriations bill, which will be considered in subcommittee today. Included in the legislation is funding for food and nutrition programs, oversight of compounding pharmacies, as well as tobacco regulation. ASTHO will monitor this bill, as there are several concerns related to language on the Drug Quality and Security Act and compounding pharmacies, as well as e-cigarette oversight.

Specifically included in the nutrition programs are:

Food and Nutrition Programs  The legislation contains discretionary funding as well as mandatory funding required by law for food and nutrition programs within the USDA. This includes funding for the Special Supplemental Nutrition Program for Women, Infants, and Children (WIC), the Supplemental Nutrition Assistance Program (SNAP), and child nutrition programs.

WIC – The bill provides $6.15 billion in discretionary funding for WIC, which is $200 million below the FY17 enacted level and the same as the President’s request. Because of robust prior-year funding and declining enrollments in the program, WIC has large carryover balances from previous years. Therefore, to make the best use of taxpayer dollars, the bill rescinds $600 million in these unobligated balances, which will have no impact on participation in the program.

Child Nutrition Programs The bill provides for $24.28 billion in required mandatory funding for child nutrition programs, which is outside the discretionary funding jurisdiction of the Appropriations Committee. This is $1.5 billion above the FY17 enacted level. This funding will provide free or reduced-price school lunches and snacks for 31 million children who qualify for the program. The bill also provides approximately $640 million for the Summer Food Service Program to ensure low-income children continue to receive nutritious meals when school is not in session. In addition, the bill continues funding for a pilot program that provides additional funds through SNAP or WIC electronic benefit transfer cards to ensure children in underserved communities receive food during the summer months.

The bill continues policy provisions designed to ease the regulatory burden on local schools, including:

  • Allowing schools demonstrating a financial hardship to seek an exemption from the whole grain nutrition standards.
  • Preventing further implementation of sodium reduction standards.
  • Providing schools with flexibility in serving low-fat flavored milk.

SNAP  The bill provides for $73.6 billion in required mandatory spending for SNAP, which is outside the discretionary funding jurisdiction of the Appropriations Committee. This is $4.87 billion below last year’s level and $2.6 million below the President’s budget request, reflecting declining enrollment and a decrease in food costs. The total includes $3 billion for the SNAP reserve fund, equal to the President’s request, which is used to cover any unexpected participation increases.

FY19 Budget Guidance 
The Office of Management and Budget released a memorandum to the heads of departments and agencies on FY19 budget guidance. The guidance states that “in the FY 2019 Budget, the Administration will build on the ambitious plans laid out in the President’s first budget. In particular, the FY 2019 Budget will provide an opportunity to present a comprehensive plan for reforming the Federal Government and reducing the Federal civilian workforce. It also will reflect the first impacts of the Government reorganization called for by Executive Order 13781. The Office of Management and Budget looks forward to collaboratively working with agencies to help deliver the fiscal restraint necessary to achieve three percent economic growth over time.”

Healthcare Reform
The Senate continues work on repealing and replacing ACA. An updated version of the bill is expected to be released today. A new score from the non-partisan Congressional Budget Office is expected early next week and a vote sometime next week. It remains unclear whether there are 50 votes to pass the bill.

In the meantime, some Democrats are proposing revisions to ACA. On July 10, Senate Minority Leader Chuck Schumer sent a letter to Sen. McConnell outlining Senate bills that they could work on to stabilize the insurance market.

Alaska 1332 Waiver Approval
The Centers for Medicare and Medicaid Services approved Alaska’s 1332 waiver, which was submitted last year. The waiver intends to shore up Alaska’s health insurance market by implementing the Alaska Reinsurance Program for 2018 and future years in an effort to stabilize the individual healthcare market.

As a reminder, part of ACA includes the opportunity for states to apply for State Innovation Waivers to “pursue innovative strategies for providing residents with access to high quality, affordable health insurance… and to develop strategies that best suit their individual needs.” 

Energy and Commerce Hearing on Opioids 
On July 12, the House Energy and Commerce Subcommittee on Oversight and Investigations held a hearing on “Combating the Opioid Crisis: Battles in the States.” Witnesses included Rebecca Boss, director of the Rhode Island Department of Behavioral Healthcare, Developmental Disabilities and Hospitals; Brian J. Moran, secretary of Public Safety and Homeland Security in Virginia; Boyd K. Rutherford, Maryland’s Lieutenant Governor; and John Tilley, secretary of Kentucky’s Justice and Public Safety Cabinet.

Members of the committee and witnesses both emphasized the need for increased access to data, as well as increased efforts in prevention and treatment. There was strong agreement that funding from the 21st Century Cures Act is integral to state response efforts as part of a comprehensive system that provides access to affordable, evidence-based treatment options.

Participants provided examples of the impact in their states. Across the board, fentanyl use and deaths are surging in states, access to evidence-based treatment and recovery supports remains a challenge, as does ensuring the widespread use of naloxone in communities.

Data from CDC’s Vital Signs opioid prescribing report provides valuable insight into where efforts are needed to reduce excessive prescribing.

Undergirding the entire hearing was the need for continued financial support for multifaceted, coordinated approaches at the state level.

ASTHO provided a letter to Chairman Tim Murphy (PA) and Ranking Member Diana DeGette (CO) highlighting our members’ efforts to stem the opioid crisis.

Senate Delays Recess
Due to a backlog of work, including healthcare reform and appointments, Senate Majority Leader Mitch McConnell delayed the Senate’s August recess until Aug. 14.

New Success Stories on the Preventive Health and Health Services Block Grant
Today, CDC released five new success stories on the Preventive Health and Health Services (PHHS) Block Grant. Iowa, Minnesota, Oregon, South Carolina, and the Commonwealth of the Northern Mariana Islands are featured.

The PHHS Block Grant provides flexible funds to 50 states, two American Indian tribes, eight U.S. territories, as well as Washington, D.C., to create new programs and provide funds where no other government funds previously existed. ASTHO works hard to maintain this funding that our members rely on to improve the health of those they serve.