Health Care Policy in the 109^th Congress

There were several health care related bills upon which the 109^th Congress deliberated, although not all of the bills were ultimately enacted. Two of the most significant health care related bills to be enacted included the Deficit Reduction Act (DRA) and the Tax Relief and Health Care Act (TRHCA). The DRA, a reconciliation bill, included about $39 billion in savings over 5 years with over $11 billion of this net savings coming out of the Medicare and Medicaid programs. The largest savings from the Medicare program came from a provision to decrease Medicare reimbursement for medical imaging. At the same time, however, the DRA averted for one year a scheduled cut in Medicare payments to physicians for 2006. The largest cuts to the Medicaid program were due to new limits put on pharmacy reimbursement for prescription drugs, although the bill also allowed for increased coverage of certain disabled children under Medicaid and relief for Hurricane Katrina victims.

The TRHCA made changes to tax and trade law as well as health care. One of the central health care provisions of this law was to avert scheduled 5 percent reductions to physician payments under Medicare and instead freeze such payments for 2007. The TRHCA also increased Medicare payment rates for dialysis and extended the cap for therapy services under Medicare for another year. The increase in spending related to these and other direct spending healthcare items in the TRHCA was partly offset by a reduction in the Medicare Advantage stabilization fund from $10 billion to $3.5 billion. Additionally, the TRHCA made various changes to the rules regarding Health Savings Accounts (HSAs) to make the health savings vehicles more favorable.

Other health-related legislation enacted during the 109^th Congress included: H.R. 6164, the National Institutes of Health Reform Act, which provided a $4.5 billion research funding boost for the National Institutes of Health; S. 3678, the Pandemic and All-Hazards Preparedness Act, which provides continued funding and increased oversight for states' bioterrorism safety and preparation programs; H.R. 6143, the Ryan White CARE Act Re-Authorization, which reauthorizes programs that fund state-level treatment of people with HIV and AIDS; and, partial assistance to prevent children from losing health insurance coverage under the S-CHIP program. Legislation deliberated upon, but not ultimately enacted included House-passed medical malpractice and association health plan legislation that foundered in the Senate and legislation to support federal funding for embryonic stem cell research which passed the Congress, but was ultimately vetoed by the President.