Compromise on Cures Heads to House

Posted on November 27, 2016November 28, 2016

The House Rules Committee has noticed that 21st Century Cures will be considered next week. The package is expected on the House floor on Wednesday, November 30. The legislation is expected to be added as an amendment to an existing bill (H.R. 34) to allow for expedited action in the Senate.

The House Rules Committee’s summary memo is 44 pages. The bill text is just under 1,000 pages. The package contains major provisions in the Cures and Senate Innovation packages, and the Mental Health Crisis Reform Act of 2016, (which includes Sections 9031 and 9032 on college mental health training and services grants and establishes interagency working group on mental health).

Generally

NIH is reauthorized until 2020 and the bill includes provisions intended to address the regulatory burden imposed on researchers, among other provisions. Rather than establish mandatory funding increases for NIH, appropriators would have to release (appropriate) funding each year to the Office of the Director. The bill establishes a similar mechanism providing $500 million for initiatives at FDA for FYs 2018-2026, and $1 billion for the Secretary to provide to states in FYs 2017 and 2018 for opioid abuse prevention and response efforts.

There are limitations to the general funds going to the office of the Director. The bill also establishes an “Innovation Projects” account for specific initiatives at NIH and FDA, which are special limitations on the general appropriations going to the Office of the Director. For NIH, the bill provides a total of $4.796 billion for FYs 2017-2026 to the NIH director, including $1.4 billion for the Precision Medicine Initiative, $1.564 billion for the BRAIN Initiative, $1.802 billion for cancer research, and $30 million for clinical research to further the field of regenerative medicine using adult stem cells.

The funding for the Innovation Fund is discretionary, but due to the phrasing in the legislation, monies the Innovation Fund does not count against the appropriators caps. However, the language essentially says that appropriations from the account are subtracted from the discretionary budget authority. What’s more important is that both CBO and the Administration (the OMB specifically) agree that spending from the Innovation funds do not count against the caps and the language works the way described below. The money will be put in a specific fund every year for the appropriators to use specifically for NIH, FDA, Cancer Moonshot, etc. In lay terms, the funds can only be used for these purposes and every dollar must be used in the next 10 years.

There are significant inclusions and some noticeable absences including:

Section 2034 – Reducing Administrative Burden for Researchers (p 66). This section contains several provisions to reduce administrative burdens on grants, including subrecipients, financial conflict of interest reporting, and reducing burdens on animal care and use in research.
Section 202 – Supports young, emerging scientists by prioritizing policies and programs (p. 45). FY 2017 appropriations includes funds for a national Academies of Science study on improving opportunities for new researcher; and Strengthens NIH’s existing loan repayment programs by increasing the yearly loan repayment amount from $35,000 to $50,000 and streamlining the loan repayment categories.

The revised draft also includes bipartisan, House-passed legislation, the Helping Hospitals Improve Patient Care Act of 2016 (H.R. 5273), that contains several provisions related to socioeconomic status (SES) adjustment and off-campus hospital outpatient department (HOPD) site-neutral payment policy.

To pay for this effort, the bill includes some of the offsets originally included in H.R. 6, including:

Section 5009. Rescinds $3.5 billion for Prevention and Public Health Fund;
Section 5010. Directs the DOE to sell a portion of the Strategic Petroleum Reserve;
Section 5011. Rescinds $464 million available to U.S. territories under ACA.

Jindal HHS Secretary Possibility, Carson Out

Posted on November 15, 2016November 15, 2016

Former Louisiana Governor Bobby Jindal is in the running for Secretary of HHS. He has health care policy in his background. At just 24 years old, he served as secretary of the Louisiana Department of Health and Hospitals, and later served as principal policy adviser to HHS Secretary Tommy Thompson in President George W. Bush’s administration. Pence and Jindal served in the House together.

Jindal has proposed Obamacare replacement plan, which he first released in 2014. Full report: More. Executive summary: More.

However, others are still in the mix, and Jindal was no fan of Trump during the Republican primaries. Jindal also attempted a run for president this cycle and then threw his support to Rubio. That could take him out of serious contention.

Dr. Ben Carson, presidential nominee, has announced he will not be in the Trump Cabinet effectively taking himself out of the running for a series of Secretary positions to which his name has been linked.

Lame Duck Priorities

Posted on November 10, 2016November 10, 2016

Congress is scheduled to return next week for a Lame Duck session of Congress and many items still remain on the 2016 agenda before Trump takes office, including wrapping up the 11 remaining FY 2017 spending bills and a 21^st Century Cures bill that both Majority Leader McConnell and Speaker Ryan said was a priority for passage in the Lame Duck session. While President-elect Trump won’t be signing any bills in the lame duck, he will influence decisions on how to wrap up the 114^th Congress.

While it is too soon to tell whether or not Congress will try to address its remaining legislative business in a Lame Duck session of Congress, or wait until President-elect Trump is sworn in on January 20 and Republicans control both the House and the Senate, a few things are fairly certain, dealing with the FY 2017 and the 21st Century Cures bill will be the Lame Duck priories.

FY 2017, Finishing the Fiscal Year

The current Continuing Resolution keeping the federal government open expires on December 9. Prior to the elections, Republican leaders expressed support for passing a series of “minibuses” that would group appropriations bills together, while Democrats were leaning toward an omnibus bill that would include all of the remaining FY 2017 bills. House Appropriations Committee Chair Rogers (R-KY) has said no decisions have been made yet on the process, but as of today, the House Appropriations Committee has put conference negotiations on hold pending further analysis.

However, Majority Leader Mitch McConnell said this week that funding the government remains a top priority heading into the lame duck and that lawmakers will wrap up spending bills this year rather than punt to the next Congress via another stopgap spending bill. McConnell said he plans to talk to House Speaker Paul Ryan and President Obama about how the FY 2017 bills could be enacted, but gave little in the way of specifics on how this would be accomplished.

That plan, though, was criticized by conservative House Freedom Caucus prior to the election as the Caucus continues to pushing for a continuing resolution to extend government funding into the next calendar year so that congressional Republicans can negotiate a spending package with Trump rather than Obama.

Must Pass? Should Pass? Legislation

Additionally, outstanding legislative priorities include the 21^st Century Cures medical innovation package and mental health reform. The Cures package is a particular priority of House Energy and Commerce Committee Chair Upton (R-MI), who is term limited as Chair. Upton has been vocal on having a package on the House floor next week when the House returned to session. However, it’s unclear if the measure will be considered. Prior to the election, Democrats voiced wanting the mandatory funding for the National Institutes of Health in the bill, but also expressed desires to insert prescription drug controls and concerns about offsets. In addition, bringing a large mandatory spending bill to the floor may not help Ryan keep his speakership with his contentious caucus.

Several other issues remain before Congress, including the FY2017 National Defense Authorization Act (NDAA), which has seen some hiccups this year, but must pass annually. Also in limbo is the Water Resources and Development Act (WRDA), which passed the House and Senate respectively and is currently being conferenced.

Trade

The 12-nation Trans-Pacific Partnership agreement, which was a priority for The Obama Administration in the Lame Duck, will not be considered, according to House Ways and Means Chairman Kevin Brady (R-TX). It will remain ”on hold” until President-elect Donald Trump decides whether to take action on the agreement in the next Congress.

SCOTUS

Supreme Court Justice Nominee Merrick Garland will not receive a confirmation hearing or a vote. With the Senate remaining in Republican control, it will wait for President Trump to submit a new nominee for the Supreme Court after he is sworn in on January 20, 2017.

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At this juncture, there are two likely scenarios for Congress to deal with these issues, and the outlook will be clearer in the coming days.

Clear the Decks

Under this scenario, President-elect Trump would indicate to Congress that he would like them to complete as much business as possible in the remaining days of the 114^th Congress. This would free up both President Trump, and the 115^th Congress to focus on his priorities during the first 100 days of his Administration, as well as big-picture items such as a Supreme Court nomination and the debt-ceiling (which could be reached as early as March 2017). This path would require some degree of cooperation from both the Obama Administration and the conservative element of the Republican conference.

Punting

The second scenario would be for Congress to push off all but must-do issues until after President-Elect Trump is sworn in. Because Republicans would control both chambers of Congress and the White House, they would, in theory, have the ability to include more of their priorities in these bills before passage. The risk in this scenario is that it bogs down the new Administration during their first days in office, at which time they will want to unveil new policy ideas, and when they have the most political capital to see those ideas to fruition.

Obamacare & the 115th

Posted on November 9, 2016

Today, Senate Republican Leader Mitch McConnell (R-KY) announced the Republican leadership’s intention to repeal the Affordable Care Act, also known as Obamacare, quickly into the 115th Congress. While there is no confirmation on a legislative vehicle, the most likely means for Congress to pass something will be the Budget Reconciliation process. This process is also the vehicle that has been suggested to move any tax reform policies.

The slim majority of Republicans in the Senate, which will likely be 51-53 seats, would not be able to overcome the 60 vote cloture requirement. The Budget Reconciliation process would avoid a cloture vote, since the Budget Reconciliation requires a simple majority to pass.

Created by the Congressional Budget Act of 1974, Budget Reconciliation allows for expedited consideration of certain tax, spending, and debt limit legislation. In the Senate, reconciliation bills are not subject to filibuster and the scope of amendments is limited, giving this process real advantages for enacting controversial budget and tax measures. This paper addresses some frequently asked questions about reconciliation.

Off to Convention

Posted on July 18, 2016

Congress has left town for its seven-week summer recess, having made progress on considering FY 2017 appropriations measures, but both chambers left town without a clear path forward. For the first time in many years (since FY 2010), the House and Senate Appropriations Committees have approved all 12 of their respective FY17 appropriations bills, although none has received final congressional approval.

Despite this progress, there appears to be growing support among House Conservative Republicans for enactment of a six-month continuing resolution (CR), which would last through March 2017, rather than a short-term CR through December that keeps the government funded through the election while an omnibus appropriations package is negotiated. Of note, Congress typically does kick the can on passing a full fiscal year funding in presidential election years,or has since 2002. The lame duck Congress typically leaves the fiscal completion up to the new Administration and not complete full appropriations during a lame duck session, the notable exceptions were 2004 and 2014.

Among other issues, a long-term CR would place at risk funding increases approved by both appropriations committees for the National Institutes of Health (NIH) and the possibility of restoring the year-round Pell Grant, as approved by the Senate committee (see next item below).

The House Appropriations Committee needed two days to finish work on its FY 2017 Labor-HHS-Education appropriations bill, which it did the morning of July 14. The vote was 31 to 19. This was the first House Labor-HHS-Education bill brought to a full committee vote since 2006.

The bill’s $161.6 billion in discretionary spending is about $257 million below the Senate committee-approved level, $569 million below the FY16 enacted level, and $2.8 billion below the Administration’s FY17 request.

The measure would raise funding for the National Institutes of Health (NIH) to $33.3 billion, an increase of $1.25 billion above the FY16 level. On a party-line vote of 19-29, the committee rejected an amendment to raise NIH funding by an additional $750 million to the Senate committee-approved level of $2 billion. The increase would have been offset by declaring certain other health-related funding in the bill as emergency spending. Labor-HHS-Education Appropriations Subcommittee Chairman Tom Cole (R-OK) reiterated the statement he made in the subcommittee markup that he viewed the committee’s NIH funding level as a floor, not a ceiling.

The committee also voted down an amendment that would have restored the year-round Pell Grant. The amendment failed by a vote of 19-27, with two Republicans joining all Democrats in support of the amendment. Chairman Cole said he would welcome restoration of year-round Pell, suggesting the Senate position might prevail in the House-Senate conference on the bill.

The panel also rejected amendments to eliminate four provisions in the bill intended to block Obama administration regulatory actions. Left standing were the provisions to prohibit the Department of Labor from implementing its new overtime rule and to prohibit the Department of Education from moving ahead on regulations on teacher preparation, defining “gainful employment” and “credit hour,” and how states license institutions of higher education.

The National Institutes of Health (NIH) funding includes $165 million for the National Children’s Study, $511.5 million for Clinical and Translational Sciences Awards, and $333.3 million for Institutional Development Awards (IDeA) programs. Other details include:

$1.26 billion, a $350 million increase, for the Alzheimer’s disease research initiative;
$195 million, a $45 million increase, for the Brain Research through Application of Innovative Neurotechnologies (BRAIN) initiative; and
$300 million for the Precision Medicine Initiative.

The bill would maintain the salary cap on external NIH grants at Executive Level II of the Federal Executive pay scale.

For higher education, the bill would raise the Pell Grant maximum award to $5,935 through a combination of discretionary and mandatory funds (which is the same as the Administration’s request and the Senate bill).

The circulated report language provided the following funding levels for key higher education programs.

Supplemental Education Opportunity Grants, Federal Work-Study, and Title VI/Fulbright-Hays were flat funded at their FY16 levels of $733 million, $989.7 million, and $72.2 million, respectively. The bill would increase funding for TRIO to $960 million, an increase of $60 million above the FY16 level, and increase funding for GEAR UP to $344 million, an increase of $22 million above the FY16 level.

In contrast, the measure would reduce funding for the Institute for Education Sciences to $536 million, a cut of $81.9 million from the FY16 level. The bill also would zero out funding for the Graduate Assistance in Areas of National Need (GAANN) program-the only graduate education-specific aid program left in the Department of Education-on the basis that GAANN duplicates grant funding available through other agencies. The report also encourages using the $100 million that the Administration proposed to use in restoring the Fund for the Improvement and Support of Education (FIPSE) in FY17 to fund the First in the World program.

Meanwhile, it turns out the 10-year forecast it made just six months ago, in President Barack Obama’s fiscal 2017 budget, was way off. A revised forecast, issued Friday by the Office of Management and Budget, identified an extra $881 billion in savings over the next decade, if Obama’s budget were to become law.