March 23, 2007

Supplemental Spending Bill Moves Forward

By a narrow margin, the House passed a $124.3 billion war supplemental spending bill, H.R. 1591, that includes a timetable for withdrawal of troops in Iraq. Many members opposed the legislation because of the troop withdrawal. The Senate will next consider the legislation, after the Senate Appropriations Committee approved a $121.7 billion bill on March 22.

The President, however, has indicated that he will veto any legislation calling for a withdrawal of the troops. Senate Republicans have indicated that if the Iraq language is not removed from the bill, they believe the Democrats do not have enough votes to override a presidential veto. Senate Republicans want to remove the language from the bill.

In addition to funding for the troops, the bill includes funds for Hurricane Katrina recovery and an increase in the federal minimum wage from the current $5.15. per hour to $7.25 per hour.

The budget blueprint approved March 23 by a Senate panel reflects a long Democratic wish list for action on health care. The fiscal 2008 plan adopted by the Senate Budget Committee signals its health care spending priorities by creating a number of “budget-neutral reserve funds.”

The most prominent reserve fund is for SCHIP; it provides up to $50 billion over five years for reauthorization of the program. The budget neutral feature of the fund means all $50 billion would have to come from cuts elsewhere in the federal budget, from increasing taxes or otherwise increasing revenue, or a combination of the two. The committee is anticipating that at least $15 billion of the $50 billion for SCHIP will come from Medicare cuts.

Another reserve fund is for costs associated with legislation that “makes health insurance coverage more affordable or available to small businesses and their employees without weakening rating rules or reducing covered benefits.”

The plan creates additional reserve funds to improve medical care, disability benefits, disability evaluations, and claims processing for wounded service members. The plan also creates reserve funds to promote the quality of long-term care, and create parity between insurance benefits for mental illnesses.

There is also a reserve fund for “health care reform” to cover the uninsured — the creation of which is contingent on enactment first of SCHIP reauthorization.

The House Budget Committee on March 22 passed by 22-17 a Fiscal Year 2008 budget resolution that differs little from the Democratic budget resolution now up for consideration in the Senate.

Both plans would erect procedural barriers to extending President Bush’s signature tax cuts, reject the administration’s proposed cuts to Medicare and Medicaid, and outline significant spending increases for education and veterans’ benefits.

The House bill was crafted by Budget Chairman John M. Spratt Jr. (D-S.C.) and exceeds President Bush’s proposed discretionary spending level for fiscal 2008 by more than $24 billion. Spratt’s budget restores a number of cuts in the President’s budget while fully funding his request on defense and war spending. It adds $6.6 billion over Fiscal Year 2007 funding for veterans’ health care; $50 billion over five years for the State Children’s Health Insurance Program (S-CHIP); and $5 billion over the President’s budget request for education.

Republicans said the budget would raise taxes and failed to address entitlements. Republicans offered almost 30 amendments addressing a wide range of issues, including tax policy, earmarks, the line-item veto and emergency spending. Almost all were rejected on party-line votes. House floor consideration of the budget is expected next week.

Senate Democrats fended off a string of amendments to their fiscal 2008 budget resolution from Republicans intent on cutting spending and taxes.

The House Appropriations Subcommittee on Labor, Health and Human Services, Education and Related Agencies held a hearing March 19 on funding for Employment, Training and Placement Programs planned for fiscal year 2008.

The panel heard testimony from Emily Stover DeRocco, Assistant Secretary, Employment and Training Administration (ETA) for the U.S. Department of Labor. She highlighted the need for improvements in the nation’s workforce development system

“The workforce investment system suffers from heavy infrastructure costs, a lack of integration, which causes too much money to be spent on supplicate of services and infrastructure, and not enough on meaningful education and training,” said DeRocco.

Rep. Tom Udall (D-NM) said such comments on the need to invest in the education and training of American workers stand in marked contrast to the fiscal year 2008 budget request. “The administration would slash $1.1 billion from employment and training programs that would help middle- and low- income Americans acquire the job skills they need to compete in the global economy,” said Udall.

DeRocco said the Administration seeks to address these concerns through its $3.4 billion proposal for Career Advancement Accounts (CAA’s). Udall noted that the ETA budget proposes legislation to consolidate Workforce Investment Act (WIA) programs into a single block grant to finance CAAs.

Rep. Udall noted that funding streams for adult education, youth training, and dislocated worker training have been reduced by 34.5 percent in real terms since fiscal year 2002.

While Democrats on the panel agreed that WIA could certainly be improved, they all expressed concern that the ETA’s proposal could lead to the dismantling of the workforce infrastructure system.

Reps. Luis Gutierrez (D-IL) and Jeff Flake (R-AZ) on March 22 introduced legislation that would comprehensively overhaul the nation's immigration laws in part through an employment verification system and a "new worker" program.

The legislation known as the Security through Regularized Immigration and a Vibrant Economy Act of 2007 (STRIVE Act) provides for border security, stronger "interior enforcement," such as penalties for immigrants who violate the law, an employment verification system, and a "new worker" program for future immigrant workers. The measure also would overhaul the visa system and allow qualified, undocumented immigrants already in the country to earn legal status.

Under the bill, the proposed employment verification system ultimately would be used by employers to verify the status of all new workers and new hires. The verification system would be phased in over time and apply first to employers in areas of "critical infrastructure" and to large employers, the summary said. Employers who did not comply with the system would face civil penalties and those who knowingly hire illegal immigrants would face criminal penalties under the bill.

The "new worker" program in the bill would initially allow up to 400,000 new workers into the country with yearly adjustments on that number based on market demand, the summary said.

Under the bill, a new worker visa program would be created with a new "H-2C" visa. The visa would be valid for three years and could be renewed for another three years, the summary said. Under the program, employers first would have to try to hire qualified U.S. workers and offer jobs to them before recruiting foreign workers, the summary said.

For undocumented workers and their families who are already in the country, the legislation would create a new visa program valid for six years that would provide work and travel authorization and protection from removal, the summary said.

To earn citizenship, individuals would meet employment requirements during the six-year period prior to the application, pay a $1,500 fine and application fees, complete background checks, learn English, pay taxes, and among other requirements, also satisfy a "legal re-entry" requirement.

Legislation to improve the overall care of the nation’s veterans passed the House this week. One of the bills, H.R. 327, would create a suicide prevention program at veterans’ medical centers. Other legislation, H.R. 797, would expand benefits for veterans with impaired vision. In addition, a routine cost-of-living increase (COLA) for veterans with service-connected disabilities, H.R. 1284, was approved.

Iowa Democrat Leonard Boswell sponsored the suicide prevention bill which mandates the screening of all patients at VA medical facilities for suicide risk factors and the tracking of at-risk veterans. Each VA medical center would designate one suicide prevention counselor and conduct outreach to veterans and their families. The bill would also mandate 24-hour availability of mental health care and a toll-free mental health hotline for veterans. Senator Tom Harking (D-IA) has introduced a companion bill in the Senate, S. 479, but the Senate Veterans’ Affairs Committee has yet to take action on the bill.

Under the vision bill, veterans receiving benefits for service-connected loss of sight in one eye would be allowed to receive additional benefits when their vision becomes impaired in the other eye, as opposed to when full blindness occurs. The bill also includes a measure directing the VA Secretary to work with the U.S. Department of Health and Human Services to confirm the employment status of veterans who claim they cannot work.

Finally, the COLA bill would enact a routine increase for benefits of veterans with service-connected disabilities. The percentage increase will be calculated later in the year, and will be the same as the one for Social Security benefits. The bill also applies to dependency and indemnity benefits for the families of disabled veterans.

The Commonwealth Fund Commission released results of a study which analyzes and compares leading congressional bills to expand health insurance coverage. Looking at 10 health care plans introduced in the 109th and 110th Congresses, President Bush’s proposal, and other plans that would make sweeping changes such as expanding existing programs like Medicare and SCHIP, researchers found these proposals hold promise for increasing the number of insured Americans.

In addition to reducing the number of uninsured, many of the plans would reduce health care costs over time. The most efficient proposals are those that pool health risk by covering people in large groups, saving between $57 billion to $74 billion in insurance and administrative costs. Rep. Pete Stark’s (D-CA) AmeriCare proposal, which would open the Medicare program to everyone, would do this, as well as Senator Ron Wyden’s (D-OR) Health Americans Act, which would help people purchase coverage through large regional insurance exchanges.

According to the analysis, President Bush’s plan would cost the government less and reduce health spending by more than the plans mentioned above. Savings will be achieved under President Bush’s proposal by reducing the comprehensiveness of coverage and inducing lower health service use. However, more people would be expected to buy coverage through the individual insurance market resulting in a $5.5 billion increase in the costs of insurance administration.