House of Representatives
Earlier today, CRFB Senior Policy Director Marc Goldwein testified before the House Energy and Commerce Health Subcommittee. The hearing, entitled "Setting Fiscal Priorities," discussed policy options to reduce health care spending. Also testifying were Executive Director of the Medicare Payment Advisory Commission Mark Miller, the American Action Forum's Director of Health Care Policy Chris Holt, and Georgetown Professor of Public Policy Judy Feder. The witnesses represented different perspectives and focused on different parts of the health care system.
Miller's appearance made up the first panel, and naturally, his testimony focused on Medicare. He gave some background on Medicare but focused on the types of savings policies that MedPAC has recommended in its reports. These policies include simple recommendations on annual payment updates (increases or decreases) or more far-reaching recommendations like site-neutral payments and bundled payments (two policies that were part of our PREP Plan). Questions for Miller spanned a far range of topics, including the Affordable Care Act's payment reductions.
The second panel had the other three witnesses. Goldwein's testimony focused on both the need to rein in health spending to control debt and the options available to do so. He noted the large run-up in debt that is projected to have in the coming decades and the central role health care plays in that.
For solutions, he focused on two different types of policies: "Benders" which have the potential to bend the health care cost curve and "Savers" which are not as transformative but lead to a better allocation of health care spending. In his oral testimony, he focused on the policies in the PREP Plan, which involve reforming Medicare's cost-sharing structure and provider payments to encourage more efficient care. His written testimony included many other options with the potential for bipartisan support.
A new bipartisan bill seeks to drive down prescription drug costs for consumers and the federal government.
The Fair Access for Safe and Timely Generics Act or FAST Generics Act (H.R. 5657) was introduced late last week by Rep. Steve Stivers (R-OH) and Rep. Peter Welch (D-VT). It's goal is to close a loophole in drug safety rules (Risk Evaluation and Mitigation Strategies, or REMS) that allows name-brand drug manufactures to withhold access to some drug samples from generic manufactures, who generally use these samples to help produce safe and cheaper generic versions of drugs.
This bill comes on the heels of a report by Matrix Global Advisors that estimated:
[the] delay [in] generic market entry for these products totals $5.4 billion in lost savings to the U.S. health care system annually. The federal government bears a third of this burden, or $1.8 billion… Among government health care programs, Medicare, which accounts for nearly 26 percent of total U.S. prescription drug spending, experiences lost savings of $1.4 billion annually. The economic cost to Medicaid (both federal and state) totals $400 million.
The House passed today two bills permanently reinstating three tax provisions that expired at the end of 2013. Extending these provisions would cost about $75 billion. Because they approved these tax cuts without offsetting savings, the two bills would add about $95 billion to the deficit, including interest.
Reps. Peter Welch (D-VT) and Keith Rothfus (R-PA) have officially re-launched a bipartisan caucus in the House looking to promote the use of high-quality, low-cost drugs.
Appropriations season is in full swing. The House has already passed the Legislative Branch and Military Construction-Veterans Affairs bills, while the Senate Appropriations Commitee is scheduled to officially set 302(b) allocations and mark up the Military Construction-VA and Agriculture bills this Thursday.
Budgets for the upcoming fiscal year have been released from the White House, House Republicans, House Democrats, the Republican Study Committee, the Congressional Progressive Caucus, and the Congressional Black Caucus. All of them offer competing visions for the size and scope of government over the next decade.
Just after House Democrats released their budget this week, the Republican Study Committee has come out with its own proposal to balance the budget in just four years. The budget reduces spending by $7.4 trillion over ten years relative to their baseline, which includes a war drawdown. By 2024, the budget produces a surplus of nearly $300 billion, or 1.1 percent of GDP.
Congressman Reid Ribble (R-WI) and Congressman Mark Pocan (D-WI) introduced the Long-Term Studies of Comprehensive Outcomes and Returns for the Economy Act, or Long-Term SCORE Act, today.
This blog has corrected the amount of Medicare savings in the budget. It previously said $50 billion, but that included the cost of repealing the Medicare sequester.
This morning, House Budget Committee Chairman Paul Ryan released his FY 2015 budget proposal, "The Path to Prosperity." The budget reaches balance in 2024 by cutting over $5.1 trillion of spending over ten years (relative to a "PAYGO baseline"), and it assumes an additional $175 billion in deficit reduction from a "fiscal dividend"