House Republicans To Hold Vote on ‘Cut, Cap and Balance’ Bill

House Republican leaders on Friday said they intend to hold a floor vote this week on legislation that would cut the federal deficit, cap government spending and amend the Constitution to require a balanced budget, the Wall Street Journal reports (Bendavid/Hook, Wall Street Journal, 7/16).

For more than a week, congressional leaders and White House officials have been negotiating a deal on a budget, deficit-reduction proposals and legislation to increase the government's debt limit.

However, the talks have been held up by partisan disagreements over entitlement spending and taxes. Republicans have called for broad spending cuts and entitlement reforms, while Democrats have sought new tax increases to generate revenue (California Healthline, 7/15).

Details on 'Cut Cap and Balance Act'

Under the House GOP-sponsored "Cut, Cap and Balance Act of 2011" (HR 2560), caps would be placed on discretionary and mandatory spending as a percentage of the gross domestic product. In addition, the bill would increase the debt ceiling by $2.4 trillion, but only if Congress approves a Constitutional amendment requiring the federal government to balance its budget (Schatz, CQ Today, 7/17).

The plan omits any revenue-raising tax increases, which could further broaden the partisan divide in negotiations (Wall Street Journal, 7/16).

However, the House vote on the bill -- which is tentatively scheduled for Tuesday -- is considered to be largely symbolic because it is unlikely to pass in the Democratic-controlled Senate, according to CQ Today.

Senate Republican leaders also plan to seek a floor vote this week on a companion "cut, cap and balance" bill, but Senate Democrats have noted that neither plan has adequate support for final passage in the upper chamber (CQ Today, 7/17).

Medicare Eligibility Age Change, Means Testing Under Consideration, Obama Says

President Obama during a White House news conference on Friday outlined some of the changes to Medicare to which he would be willing to agree as part of a broader accord with Republicans in the budget and debt-limit negotiations, Modern Healthcare reports (Zigmond, Modern Healthcare, 7/15).

Obama said he is open to a proposal to increase the Medicare eligibility age from 65 to 67 and consider a means-testing provision (Reichard, CQ HealthBeat, 7/15).

Obama noted that lawmakers must ensure that current Medicare beneficiaries "as much as possible are not affected" by the changes, adding that it should be just as important to the lawmakers to ensure the sustainability of the program. "What we're not willing to do is restructure the program in the ways coming out of the House where we voucherize the program," Obama said, alluding to the Medicare overhaul proposal in the House-passed GOP FY 2012 budget resolution (H Con Res 34) (Modern Healthcare, 7/15).

The president also reiterated that he will continue to press congressional leaders to develop the most comprehensive budget and deficit-reduction package possible (Shear, "The Caucus," New York Times, 7/15). "I am still pushing for us to achieve a big deal" that would save as much as $4 trillion over 10 years, he said (CQ HealthBeat, 7/15).

Governors Express Concern About Budget Impasse

Several governors who convened for the National Governors Association's semiannual meeting in Salt Lake City over the weekend expressed concern about the budget and debt-limit debate, with some noting that federal funding for Medicaid and jobs could be severely affected by some proposals being considered, the New York Times reports.

Ahead of the meeting, NGA Chair Gov. Chris Gregoire (D-Wash.) and Vice Chair Gov. Dave Heineman (R-Neb.) sent a letter to Obama and congressional leaders warning them that proposals to cut as much as $100 billion in Medicaid payments to states over a decade would cause great fiscal difficulties (Cooper, New York Times, 7/15).

Analysts Following Talks of Medicaid Matching Rate

Health care analysts are following closely any budget negotiations that discuss changing the federal matching rate for states to help run Medicaid programs, Modern Healthcare reports.

Analyst Carl McDonald said, "There has been talk about changing the calculation in a way that would result in fewer federal dollars being transferred to states." He added that doing so "would presumably pressure the Medicaid managed care industry, heightening what is already a difficult budget situation in states" (Zigmond, Modern Healthcare, 7/17).

Medicaid Advocates Concerned

Medicaid advocates are concerned about Democrats' seemingly inconsistent commitment to protecting the program from large-scale cuts during budget negotiations, The Hill's "Healthwatch" reports.

They recently were displeased with statements on budget negotiations by House Minority Leader Nancy Pelosi (D-Calif.), in which she opposed cuts to Medicare but neglected to mention Medicaid. Democratic staffers said that references to Medicare inherently refer to Medicaid as well, but one advocate said Pelosi's failure to mention the program is a missed opportunity (Pecquet, "Healthwatch," The Hill, 7/16).

Coburn To Offer Budget Plan

Sen. Tom Coburn (R-Okla.) on Monday plans to release a $9 trillion deficit-reduction package that would eliminate special tax breaks, The Hill reports. According to Coburn, the federal government can save $1 trillion through tax reforms. He also said that lawmakers can curb the projected growth of Medicare and Medicaid by $1 trillion, while still providing "what seniors need" (Bolton, The Hill, 7/17).

Democrats Angered by Hospital Ads

Meanwhile, Sen. Charles Schumer (D-N.Y.) and other New York lawmakers are angered by recent full-page newspaper advertisements that suggest Democrats could "kill health reform" through budget negotiations, the Wall Street Journal reports.

On Wednesday, Schumer held a meeting with leaders of the Greater New York Hospital Association and 1199 SEUI, a health care workers union. Schumer told the groups' leaders, "We can't believe you would do this to people who are trying to help you" (Barrett, Wall Street Journal, 7/16).