Obama Administration Responds to Criticism of 2012 Budget Proposal
On Tuesday, the Obama administration launched a concerted effort to defend its fiscal year 2012 budget proposal against Republican criticism that it failed to address entitlement spending as part of its strategy to resolve the federal deficit, the AP/San Francisco Chronicle reports (Fram, AP/San Francisco Chronicle, 2/15).
President Obama's budget plan includes a series of changes in health-related spending at some federal agencies, such as CDC, FDA and NIH, but mostly froze or reduced budgets for other agencies and programs. The administration has insisted that total spending for Medicaid and Medicare will be reduced under the federal health reform law (California Healthline, 2/15). The administration has said that the budget proposal is projected to reduce the federal deficit by $1.1 trillion over the next 10 years (Feller, AP/Washington Post, 2/15).
Republicans on Tuesday roundly criticized the proposal for failing to include large-scale plans to address entitlement spending for Medicare and Social Security (AP/San Francisco Chronicle, 2/15).
During a White House news conference on Tuesday, Obama acknowledged that Medicare and Medicaid are key drivers to the growth of the national deficit growth, but he explained that his budget proposal omitted any entitlement overhauls because he wanted Democrats and Republicans to collaborate on a compromise plan to address the issue, the Wall Street Journal reports (Weisman/Meckler, Wall Street Journal, 2/15).
Obama said "these deals get done ... not because there is an Obama plan out there," but "because Democrats and Republicans are both committed to tackling this issue in a serious way" (Rowland, Washington Times, 2/15).
Obama's Plan 'Far More Modest' Than Deficit Panel's Proposals
The budget blueprint's deficit relief proposals are "far more modest" than those offered by Obama's bipartisan National Commission on Fiscal Responsibility and Reform in December 2010, the AP/Post reports. According to the AP/Post, NCFRR's proposals have the potential to eliminate as much as four times as much of the federal deficit as the administration's budget plan (AP/Washington Post, 2/15).
NFCRR's recommendations seek to restrict the growth of federal health spending to no more than the gross domestic product plus 1% after 2020. The recommendations also included:
- Instituting a new formula to reimburse physicians, replacing the sustainable growth rate formula;
- Establishing and enforcing a federal budget for Medicare and Medicaid; and
- Adopting comprehensive malpractice reform, among other health care proposals (California Healthline, 11/11/2010).
Obama was criticized for not heeding NCFRR's recommendations.
House Budget Committee Chair Paul Ryan (R-Wis.) said, "In our nation's most pressing fiscal challenges, the president has abdicated his leadership role. When his own commission put forward a set of fundamental entitlement and tax reforms ... he ignored them."
Republicans Insist on Obama's Leadership
Top House and Senate Republicans on Tuesday said they would defer to the administration to take the lead on developing an overhaul plan for Medicare and Social Security (AP/San Francisco Chronicle, 2/15).
Senate Minority Leader Mitch McConnell (R-Ky.) said, "We're still waiting for the president to lead. There will be no entitlement reform without presidential leadership" (Wall Street Journal, 2/15).
House GOP leaders noted that they intend to release a 2012 budget plan that would not "punt" on addressing the programs (Washington Times, 2/15).
More Details on Budget Proposal's Medical Malpractice Reform Plan
Obama's proposed budget plan would allocate $250 million in grants beginning in FY 2012 to help states revamp their medical liability laws, Modern Healthcare reports (Blesch, Modern Healthcare, 2/15).
HHS Secretary Kathleen Sebelius told members of the Senate Finance Committee on Tuesday that Obama "is very serious" about following up on the issue, which NCFRR addressed in December 2010 (Alonso-Zaldivar, AP/Bloomberg, 2/15).
Under Obama's budget proposal, the grants would be distributed by the Department of Justice, with guidance from HHS. The plan calls for $100 million to be disbursed in FY 2012 and $50 million to be disbursed annually over the following three years (Modern Healthcare, 2/15). According to AP/Bloomberg, the money could be used to:
- Exclude caps on jury awards;
- Establish health courts, in which specially trained judges would preside over malpractice cases and award compensation from a set schedule;
- Create a legal defense for physicians, hospitals and other providers who follow guidelines for best clinical practices and use electronic health record systems;
- Establish initiatives that require hospitals and physicians to disclose mistakes early, offer an apology and compensation, and also agree to make changes to protect other patients from being harmed in the same way; or
- Revise legal rules that result in higher malpractice awards (AP/Bloomberg, 2/15).