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August 2011

In August, Congress and the White House finally reached a deal on debt reduction, which has implications for federal spending for years to come.

Budget Deficit Deal

The House of Representatives and the Senate have passed and the President signed into law the Budget Control Act that provides a framework for raising the federal debt ceiling, while substantially cutting federal spending. How public health spending will be affected remains unclear at this time because Congress has much work yet to do.

The law raises the current $14.3 trillion ceiling on total federal borrowing by $2.1 trillion allowing the Treasury Department to operate beyond the 2012 election and into 2013. The increase in the debt ceiling will be offset by cuts in both discretionary and entitlement spending through a two phase process. The first step is immediate cuts of $900 billion in discretionary spending over 10 years, split between $550 billion in cuts in non-defense spending and $350 billion in cuts in defense spending. The second phase includes additional cuts of at least $1.2 trillion to be negotiated in the fall by a special joint committee. The recommendations of the committee are subject to vote without amendment before the end of 2011. 

Committee members include Senator Patty Murray (D-WA) and Representative Jeb Hensarling (R-TX), co chairs; Senators Max Baucus (D-MT), John Kerry (D-MA), Jon Kyl (R-AZ), Pat Toomey (R-PA) and Rob Portman (R-OH) and Representatives Dave Camp (R-MI), Fred Upton (R-MI), James Clyburn (D-SC), Xavier Becerra (D-CA), and Chris Van Hollen (D-MD).

If the recommendations of the special joint committee are not passed by December 23, 2011, an across-the-board cut will take place with 50 percent coming from defense spending and the other half coming from non-defense spending and Medicare providers taking effect January 1, 2013. The amount of the cut will be equal to the amount of the rise in the debt ceiling requested by the president. Exempted from the across-the-board cut are Social Security, Medicaid, WIC, food stamps, and other safety net programs for children.

A timeline of key dates and other information on the debt reduction deal are available here.

FY2012 Funding

The Budget Control Act (BCA) sets a spending cap for FY2012 spending that is higher than the House-passed FY2012 Budget Resolution.The House of Representatives has marked up six of the 12 funding bills with three more passed through the Appropriations Committee. The Senate has only passed one bill with no others brought before the Appropriations Committee for consideration. Congress is in recess for August and will have only the month of September to complete the bills or pass a continuing resolution to keep the government running.

The House allocation for the House Labor, Health and Human Services and Education Appropriations Subcommittee prior to the passage of the BCA was $18 billion (11.5 percent) less than FY2011 funding of $157.4 billion. However, the BCA caps non-security discretionary spending for all programs at approximately $22 billion MORE than the House FY 2012 cap and almost $15 billion less than FY 2011 (4 percent cut). For FY2012, the BCA cap cuts Labor, Health and Health and Human Services, and Education spending by approximately $11 billion with the restoration of about $9 billion in Pell Grant funding. Because the House has been developing and passing bills based on funding allocations for the 12 appropriations bills at lower levels than the caps agreed upon in the new law, it is unclear if funding will be restored.  Because the Senate never passed a budget resolution, they are likely to use the funding levels in the new law as they draft the remaining 11 appropriations bills.

The fall of 2011 will be a critical time for LHDs to educate members of Congress on the importance of governmental public health programs to communities. More information is available here.

Health Reform Implementation

Data Collection

Per the Affordable Care Act (ACA), the U.S. Department of Health and Human Services (HHS) announced new draft standards for comment on collecting and reporting data on race, ethnicity, sex, primary language, and disability status, and plan for collection of health data on lesbian, gay, bisexual and transgender populations.Both efforts aim to help researchers, policymakers, health providers and advocates to identify and address health disparities impacting these communities. NACCHO provided comments addressing the draft standards.

ClinicalPreventive Services for Women

On August 1, HHS adopted recommendations developed by the Institute of Medicine for women''s preventive services and issued guidelines for preventive services for women that insurers must cover without cost sharing in new health plans starting in August 2012. The guidelines include:

Improved screening for cervical cancer, counseling for sexually transmitted infections, and counseling and screening for HIV;

A fuller range of contraceptive education, counseling, methods, and services to reduce unwanted pregnancies and promote optimal birth outcomes;

Services for pregnant women including screening for gestational diabetes and lactation counseling and equipment;

At least one well-woman preventive care visit annually; and

Screening and counseling for women and adolescent girls for interpersonal and domestic violence.

State Exchange Regulations

On July 15, HHS released a proposed rule for the establishment of exchanges and qualified health plans. The exchanges are new marketplaces where individuals and small businesses can shop for health insurance. According to HHS, the rule provides states guidance and options on how to structure their exchanges in two key areas: setting standards for establishing exchanges, setting up a Small Business Health Options Program (SHOP), performing the basic functions of an exchange, and certifying health plans for participation in the Exchange, and ensuring premium stability for plans and enrollees in the Exchange. The Robert Wood Johnson Foundation''s Health Reform GPS provides a comprehensive overview of the exchange regulation. Comments are due September 28. The final rule is expected to be issued later this year.

Community Health Centers

On August 9, HHS announced the awarding of $28.8 million to 67 community health centers.  The funding was awarded through the ACA''s New Health Center Access Points to new community health centers or existing grantees to add an additional site. HHS estimates the new sites will serve an additional 286,000 patients. More information is available here.

PAHPA Reauthorization

The authorization for the Pandemic and All-Hazards Preparedness Act expires on September 30, 2011. Committees in the House and Senate held hearings in preparation for future consideration of reauthorization legislation. On August 25, the House Energy and Commerce Committee passed by voice vote the Pandemic and All-Hazards Preparedness Reauthorization Act of 2011 (H.R. 2405). The bill reauthorizes certain provisions of the Project Bioshield Act of 2004 and Pandemic and All-Hazards Preparedness Act of 2006. To ensure passage in the current environment, the bill freezes public health preparedness funding at FY2011 levels. Senators Richard Burr (R-NC), Bob Casey (D-PA), Mike Enzi (R-WY) and Tom Harkin (D-IA) are drafting reauthorization legislation to be considered in the Senate Health, Education, Labor and Pensions (HELP) Committee in September. NACCHO continues to press for reauthorization to happen this year and for appropriators to hold the line on cuts to preparedness funding in the FY12 funding cycle.