Publications & Presentations
January 11, 2016
From Bloomberg BNA

By Nathaniel Weixel

Congress surprised everyone in 2015 by working together to permanently fix the Medicare sustainable growth rate (SGR) formula. Had Congress not acted, doctors would have faced a 21 percent payment cut. It was an example of bipartisanship that some hoped would be a sign of a positive working relationship between the parties in the future, but additional Medicare reforms are unlikely to attract the bipartisan support needed to get them enacted.

On the legislative front, analysts expect 2016 will serve mostly as a bridge year to 2017, as lawmakers will be reluctant to put forward too many controversial proposals in a presidential election year. Congress is scheduled to be in session fewer than 120 days in 2016 because of the summer's presidential conventions, which doesn't leave much time for major legislation to be considered.

House Speaker Paul Ryan (R-Wis.) said his plan to have House Republicans offer specific detailed proposals for overhauling U.S. health-care in 2016 may not include offering legislation. Speaking to reporters Dec. 17 at his weekly press conference, Ryan declined comment on putting those proposals in legislative language, saying the issue would be discussed at the joint House-Senate Republican retreat set for January in Baltimore.

Budget Battles

President Barack Obama is scheduled to release his budget priorities during the first week of February. The 2015 budget proposal included broad policy ideas, such as allowing Medicare to negotiate drug prices. In 2015, Obama proposed about $400 billion in cuts to government health spending, much of it in the form of recycled policies from past budgets that weren't adopted by Congress. Large parts of the savings came from adjustments to provider rates and Medicare structural reforms. For example, the budget proposed to save approximately $100 billion through 2025 by adjusting payment updates for certain post-acute care providers, and to align Medicare drug payment policies with Medicaid for some low-income patients.

Julius Hobson, a senior policy adviser at Polsinelli PC in Washington, told Bloomberg BNA he expects more of the same types of broad-reaching proposals, including a copayment for home health visits and a hospital site-neutral payment provision.

A presidential budget proposal is frequently dead on arrival, although “it still sets the tone” for the year ahead, Hobson said. The proposals often are ignored by Congress, even when the legislature is controlled by the president's own party. While the document is the first step in negotiations over the government's annual spending plan, it often serves more as a statement of ideals and priorities than as a basis for policy.

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