Update on the President’s FY2013 Budget

Yesterday the White House unveiled the President’s requested FY2013 Budget.  As expected, this budget request contained few significant spending increases in health care, and held funding steady for many programs.  The budget request includes an increase of $115 million increase for the Indian Health Service budget, while holding the Title V Urban Indian Health line item steady at $42.9 million.  The President’s budget also invests $3.1 billion for community health center funding in 2013 to support the creation of more than 25 new health center sites across the country.

While this budget does not reflect a bold and robust commitment to urban Indian health care, NCUIH continues to meet with Congressional appropriations staff to identify opportunities for increasing the Title V UIHP line item.  To date, these meetings have left us optimistic that an increase in UIHP funding for FY2013 cannot be ruled out.  We will be working very hard over the coming months to build support for our position and to ensure that UIHPs see an increase in funding for FY2013.

Additional Update on Medicare Doc Fix

I just wanted to provide a quick update on the Medicare “Doc Fix”, payroll tax cut, and unemployment benefits extension.  Earlier today, the House passed by unanimous consent the Senate-approved measure that will extend these three provisions for two additional months.  The President has signed the measure and it is now law.  Within the next two months, Congress will need to revisit this issue again and approve a longer-term fix, but we have secured a reprieve for now.  To summarize:

• Medicare provider reimbursements will not be reduced by 27.4%
• the payroll tax will remain at 4.2% (and not increase to 6.2%)
• federal unemployment benefits will continue uninterrupted into the new year

Update on Medicare “Doc Fix”, Payroll Tax Cut, and Unemployment Benefits Extension

Congress has so far failed to reach agreement on three timely pieces of legislation that carry great political and economic significance.  Of particular importance to Urban Indian Health Programs is the so-called “Medicare Doc Fix.”  Current federal law requires that Medicare reimbursement rates be adjusted annually based on a formula tied to the health of the economy.  The law also says that Medicare reimbursement rates should be cut every year to keep Medicare financially sound.  Congress has blocked those cuts from happening 12 times over the past decade, and could still do so this year.  However, if Congress does not take action to block these cuts, Medicare providers will face a mandatory 27.4% reimbursement rate cut starting January 1.

Although there is broad bipartisan support for passing a “patch” to prevent the reimbursement cuts from occurring, the patch has been the victim of inter-party wrangling over the length and terms of the payroll tax cut and the proposed extension of unemployment benefits.  House Republicans have considered introducing a stand-alone “Doc Fix” if the Senate and House remain deadlocked over the payroll tax package.  But Democrats are insisting that the House pass the Senate-approved package that included a 2-month extension of the Medicare Doc Fix, payroll tax cut, and unemployment benefits extension.  This measure passed the Senate by an overwhelming 89-10, but it was rejected by House Republicans who are insisting on a full-year fix.

The House of Representatives is facing enormous political pressure to reconvene to pass these three critical priorities before the January 1st deadline.  Failure to extend the payroll tax cut will result in an immediate 2% tax increase on individuals two weeks from now.  An estimated 697,000 unemployed Americans could lose benefits, a number that would rise to 2.6 million by March 3rd.  Given overwhelming public support for action on these three priorities, it is widely expected that an agreement will be reached, but both parties continue to hold firm to their positions, at least publicly.  The most probable outcome is a last-minute deal to extend these provisions by two-months.

Update on Omnibus Budget Package for FY2012

Congress today released a conference report on the FY2012 appropriations bills that have yet to be signed into law. This conference report contains a reduction in the proposed increase for the Indian Health Service budget, and critically it holds funding for the Urban Indian Health Program line item flat at $43.1 million. $4.3 billion is appropriated for IHS in FY2012, rather than the $4.5 billion that was expected. The bill further reduces funding for the entire IHS budget by applying an across the board 0.16% rescission. This rescission will reduce total funding for Title V programs in FY2012 by approximately $69,000.

The House has also approved an additional resolution, H. Con. Res. 94, which would apply an additional across the board cut of 1.83% – but it is not certain if the Senate will pass this additional cut. Conversations between NCUIH and key Congressional appropriations staff has led us to believe that there is insufficient support in the Senate for the additional 1.83% cut.

Current federal spending authority was set to expire at midnight tonight, December 16th. However the House has passed a 24-hour Continuing Resolution to give the Senate time to pass the House’s appropriations package. The Senate is likely to pass the House’s appropriations package on Saturday. Signature by the President will conclude the FY2012 Congressional Appropriations process.

NCIUH expresses our deep disappointment that the bipartisan support we received from Congress for IHS and UIHP priorities did not translate into critically-needed increases in funding. While we appreciate that IHS has fared relatively well in the current budgetary environment, our current funding levels are insufficient to meet patient need and to fulfill the United States’ trust responsibility to AI/AN people. NCUIH and our allies continue to work with members of both parties to educate Congress about this solemn responsibility and to lay the groundwork for future funding increases.

Update from the IHS Director’s Blog:

FY2012 Budget Update: Rescheduled Time and Call-In Number

Posted on December 8, 2011

Thank you for your understanding as we rescheduled the call to Friday, December 9, 2011. We heard there was confusion over the correct call-in number on Tuesday, and we wanted to make sure everyone had the right information. We also heard that there was a competing CMS call at 2 pm tomorrow, so we are now holding this call at 4 pm EDT on Friday, December 9.

The call in number is 877-917-9492;

Passcode: 6967089

White House holds third tribal leaders conference

By SUZANNE GAMBOA, Associated Press

WASHINGTON (AP) — There’s little doubt President Barack Obama has won high esteem among Native Americans by breaking through a logjam of inaction on issues that matter to them.

The Obama administration this week unveiled sweeping changes to federal tribal-land leasing rules that had not been touched in 50 years. Obama nominated a Native American to the federal bench, signed a law renewing the Indian Health Care Act and settled a tribal royalties lawsuit that had dragged over three administrations.

“Obama has done better for tribes than the others, except for the Nixon administration,” said Ben Nighthorse Campbell, a former Republican senator from Colorado. President Richard Nixon advocated tribal self-determination and opposed the termination of American Indian tribes that had been occurring since the mid-1940s.

Against that backdrop of acclaim, Obama on Friday speaks for the third time with the nation’s 565 tribal leaders in Washington. The annual Tribal Nations Conference will allow Obama to boast about how he’s kept his 2008 campaign promises for the 5.2 million American Indians and Alaska natives in the U.S. It also is a chance for tribal leaders to lay out what else they expect.

American Indians have been “well-served” and “hurt” by administrations, said Bill John Baker, principal chief of the largest Indian tribe, the Cherokee Nation in Oklahoma. But Obama has gone beyond lip service, Baker said, and “backed up his words with actions that have made a positive impact on the lives of Native people.”

But with the accomplishments come greater expectations from a people whose rates of unemployment, violent crime, youth suicides, poverty and high school dropout rates are significantly higher than in the rest of the country.

“It’s two steps forward, one step backward,” Campbell said. “No matter what we do, we have to find a way for Indians to be self-sufficient and not dependent on the federal government, except for those services required by treaty in the old days.”

The administration still must implement laws Obama signed and fund lawsuit settlements. Also, tribes want to see the administration push legislation through Congress to get around a 2009 Supreme Court decision limiting the secretary of Interior’s authority to accept land into federal trust on behalf of Indian tribes. The decision has held up economic development for tribes.

“We still need improvements in roads, bridges, schools, hospitals as well as addressing the digital, electrical and clean water disparities that hamper development and quality of life issues for our people,” Baker said.

Thomas Shortbull, president of Oglala Lakota College on the Pine Ridge reservation in South Dakota, said for now he’s giving Obama a B-minus. He notes that the president hasn’t issued an executive order, as Clinton and Bush did, reminding agencies to provide money to tribal colleges.

Still, Obama has assembled a respectable bragging list. He has:

—Signed the Indian Law and Order Act to improve law enforcement and public safety in tribal communities.

—Renewed the Indian Health Care Improvement Act and made it permanent.

—Settled the class-action Cobell lawsuit over federal government mismanagement of royalties for oil, gas, timber and grazing leases and an American Indian farmers discrimination lawsuit.

—Nominated Arvo Mikkanen to be a federal judge in Oklahoma. His nomination is awaiting Senate confirmation.

Jacqueline Johnson Pata, executive director of the National Congress of American Indians and an Alaska native, said native peoples’ enthusiasm for Obama goes deeper.

Obama has embraced Native American tribal sovereignty preserved in the Constitution, court decisions and treaty agreements and made that the foundation for his administration’s dealings with tribes, Pata said.

All this has come about as tribes have become increasingly politically savvy, as well as more organized in making their agenda known, she said.

Like former Presidents Bill Clinton and George W. Bush, Obama appointed a Native American to his Intergovernmental Affairs staff. But he also appointed Kimberly Teehee, a member of the Cherokee Nation, as senior policy adviser for Native American Affairs.

In addition, Obama reminded executive department heads and agencies in a November 2009 memo of their obligation to regularly consult and collaborate with tribal officials on policies that impact Native Americans. He set deadlines for detailed consultation plans and demanded progress reports.

“I think we have made strides under the Obama administration the likes of which tribes have not seen for 30 years,” said Stacy Bohlen, executive director of the National Indian Health Board. Bohlen is a member of the Sault Ste. Marie Tribe of Chippewa Indians in Michigan.

Several agencies have yet to draft policies, according to the National Congress of American Indians.

NCUIH Statement on Resignation of CMS Administrator Dr. Donald M. Berwick

On Wednesday, November 23rd, Center for Medicare and Medicaid Administrator Dr. Donald Berwick announced that he will step down from his position on December 2^nd, nearly one month before the expiration of his appointment.  Dr. Berwick faced strong opposition to his leadership from Senate Republicans, who have pledged to block his confirmation.  Consequently Dr. Berwick cannot serve beyond the end of 2011.

The White House immediately announced the nomination of CMS Deputy Administrator Marilyn Tavenner to replace Dr. Berwick as head of CMS.  Ms. Tavenner is not expected to bring any major changes to CMS, either in terms of policy or CMS operations.  Ms. Tavenner has expressed support for lowering health care costs by improving care for the most needy, and she has opposed proposals such as the Paul Ryan plan that would turn Medicaid over to the states as a block grant program.  Like Dr. Berwick, Ms. Tavenner is expected to face a difficult confirmation process in the Senate.

Last week, NCUIH and other representatives of the CMS Tribal Technical Advisory Group expressed our gratitude to Dr. Berwick for his support for AI/AN health care during this time of great change and limited resources. NCUIH expresses our best wishes to Dr. Berwick in his new endeavors, and we congratulate Ms. Tavenner on her appointment to lead CMS.

Update on FY2012 Appropriations Process and Supercommittee Negotiations

On November 18, President Obama signed Congress’ latest Continuing Resolution, which provides continued funding for the federal government and averts a shutdown.  The Continuing Resolution maintains current levels of funding for many federal agencies, including the Indian Health Service, until December 18^th.  The Continuing Resolution was combined with H.R. 2112, which provided full-year FY2012 funding for 1) Agriculture, Rural Development, Food and Drug Administration and Related Agencies; 2) Commerce-Justice-Science, and Related Agencies; and 3) Transportation-Housing and Urban Development, and Related Agencies.

Full-year spending bills still must be passed for IHS and those agencies that were not included in H.R. 2112.  It appears likely that appropriations for IHS and other agencies will be signed into law via an omnibus package.  IHS and the Urban Indian Health Program line item secured modest but important increases in funding on the House side in H.R. 2584, which would provide an additional $2.47 million for UIHP funding, and would increase IHS funding by $392 million.  NCUIH continues to stress to House and Senate appropriators the need to preserve these critical funding increases in the final full-year appropriations law.

The “Supercommittee” which was tasked with finding $1.2 trillion in spending cuts has announced this afternoon that they were unable to reach an agreement.  According to the agreement passed last summer that raised the debt ceiling, the failure to reach a deal means that automatic cuts will take place in early 2013.  Cuts will include reductions in funding for defense, as well as a 2% Medicare provider payment reduction.  Medicaid and Social Security are exempt from automatic cuts.

It is unclear whether these automatic cuts will indeed be implented.  It will take additional legislation to exempt areas of the budget from the automatic cuts.  Some members of Congress are already planning to introduce legislation to provide exemptions for cuts to defense spending.  While it is not known whether Congress and the White House will allow these automatic cuts to take place, there will be a great deal of effort over the next twelve months to exclude certain areas of the budget from the automatic cuts.

Supreme Court will Rule on Constitutionality of ACA

As expected, the Supreme Court has announced that it will rule on the constitutionality of the Patient Protection and Affordable Care Act.  The Court will hear 5 ½ hours of oral argument in March and a ruling is expected by the end of June 2012.

The Court will decide the following issues:

• Threshold issue – can the challenge to ACA be heard yet?
  • Because the “individual mandate” is not yet in effect, can the Court decide on its constitutionality?  If the case is found not “ripe”, it will be dismissed and none of the subsequent issues will be decided upon.
  • Did Congress overstep its bounds in requiring every American to purchase health care?
    • This is likely to be an extremely close decision, and the issue will probably be decided by a 5-4 vote.  Justice Kennedy is widely considered to be the key swing vote.  His position on the constitutionality of the “individual mandate” is unknown.
    • If the mandate is unconstitutional, does the entire law need to come down, or can the rest of the law still stand?
      • This question is a critical issue for Indian Country, because if the ACA’s individual mandate provision is ruled unconstitutional, and the Indian Health Care Improvement Act is not considered severable from the rest of the ACA, then permanent reauthorization of IHCIA will be struck down.
      • Were the ACA’s Medicaid expansion provisions constitutional?
        • The ACA expands Medicaid eligibility to individuals under 133% of FPL, and the federal government assumes the added cost of these newly eligibles by providing 100% FMAP (federal reimbursement) until 2016 (with FMAP declining afterward).  If the Court decides that Medicaid expansion was impermissively coercive to the states, it will have far-reaching consequences on the ability of Congress to use its spending power.

NCUIH continues to follow legal challenges to the Affordable Care Act and we will continue to keep you updated on latest developments.

Senate Appropriations Update – Funding for Fiscal Year 2012

The Senate Appropriations Subcommittee on Interior, Environment and Related Agencies has released its draft FY 2012 appropriations bill. There is not expected to be a formal Senate Appropriations Committee mark-up of this bill. Instead, this bill is intended to demonstrate the Senate’s position on appropriations and serve as a starting point for further negotiations with the House.

The Senate bill recommends a $213 million increase for IHS in FY12. This is $179 million less than the House Appropriations Committee recommended, and $341 million less than the Administration had requested for IHS for FY12. The Senate bill appropriates less funding than the House bill for every IHS account with the exception of construction of sanitation facilities. While the House bill requested an increase of $2.47 million for the UIHP line item, the draft Senate bill would hold the UIHP line item at FY11 enacted levels ($43.053,000). The draft Senate bill also includes smaller increases than that House bill for Hospitals and Clinics, Contract Health Services, and Contract Support Costs.

The current appropriations outlook is uncertain. While the House bill would provide more robust funding increases for IHS, the bill also includes controversial policy riders dealing with the Environmental Protection Agency. This has created strong opposition among Democrats to the bill and makes it more difficult for the bill to be passed by the Senate.

The federal government is currently operating under a Continuing Resolution that will extend until November 18th. If Congress does not enact the remaining FY12 Appropriations bills before then, another Continuing Resolution will be necessary. At this point, this appears to be the most likely scenario.