Senate Finance Committee members on Thursday at a hearing with HHS Secretary Mike Leavitt "criticized many health care provisions" of President Bush's fiscal year 2007 budget proposal, CQ HealthBeat reports (Carey, CQ HealthBeat, 2/9). The proposal includes $36 billion in spending reductions for Medicare over five years and nearly $5 billion in Medicaid spending reductions over five years. Spending cuts for Medicare, which are the largest single reduction in the proposal, include lowering hospital reimbursement rates for an estimated savings of more than $8 billion over five years and reducing nursing home reimbursements for an estimated savings of more than $5 billion over five years. Bush's budget plan also would reduce Medicare home health care provider reimbursements, for savings of $3.5 billion over five years (Kaiser Daily Health Policy Report, 2/9). Senate Finance Committee Chair Chuck Grassley (R-Iowa) said it did not make sense to reduce reimbursements to Medicare providers while maintaining current payment levels for Medicare Advantage plans. Grassley and Sen. Max Baucus (D-Mont.), the committee's ranking Democrat, suggested the elimination of a $10 billion "stabilization" fund created to encourage insurer participation in Medicare. Grassley said, "This fund hasn't been used at all. There are already a good number of regional Medicare Advantage plans participating. If we'd known that in 2003 (when the bill passed) I doubt we'd have the money stashed away there." Leavitt said the insurers' fund was needed to ensure that beneficiaries retain access to PPOs (CQ HealthBeat, 2/9). Baucus also said that proposed expansions of health savings accounts would "make health care more expensive for those who stay in traditional coverage." Leavitt said 40% of people signing up for HSAs previously were uninsured (Posner, CongressDaily, 2/9). In related news, the White House Office of Management and Budget on Thursday released details of Bush's budget proposals (Cohn, CongressDaily, 2/9).
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Veterans Groups Oppose VA Fees
In related news, military organizations and their "motivated grassroots lobbying base" have begun letter-writing campaigns and demonstrations in Washington, D.C., to oppose budget provisions addressing Department of Veterans Affairs health services, CongressDaily reports (Scully, CongressDaily, 2/10). The budget proposal calls for veterans with higher incomes or less-severe disabilities to contribute higher copayments for prescription drugs and pay an enrollment fee (Kaiser Daily Health Policy Report, 2/9). The proposal would save VA $735 million in FY 2007 and $11 billion over five years. John Class, deputy director of government affairs for the Military Officers Association of America, said the proposal would "contain costs by making it expensive so people won't join ... and maybe use other insurance. Or just not seek medical care." Joint Chiefs of Staff Chair Peter Pace said, "We believe that this health care benefit is unique and superb. We want it to continue, ... and we believe that (the proposal) is one way to assist in helping us achieve the goal of long-term sustained health care" (CongressDaily, 2/10).
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