Fiscal Year 2024 commences on October 1 of this year for the federal government. The stage is set every year by submission of a budget by the president to Congress for its consideration. Regardless of which party controls the White House, legislators in both chambers typically every year see little concordance between what the nation’s chief administrator wants and what eventually will materialize in a final spending package.
This year may prove to be a faithful rendition of what characteristically unfolds annually. President Biden submitted a budget proposal that is widely viewed as being highly unlikely to reach fruition. Roadblocks occur along the way, deadlines are rarely met, and it is customary each October 1 for a series of short-term resolutions to be created as a means of enabling the government to continue to function. Now that Congress is divided with Republicans controlling the House and Democrats the Senate, the pattern can be expected to manifest itself once again in 2023. The main features of the Administration’s proposed budget include an overall $6.9 trillion that involves a 3.3% increase in defense spending and a 6.5% increase for nondefense discretionary programs, Taxes would be increased by $5.5 trillion and the federal deficit would decline by more than $2 trillion over the next 10 years. The U.S. Department of Health and Human Services would see an 11.5% increase to its overall budget, including $144.3 billion in discretionary and $1.7 trillion in mandatory proposed budget authority.
The solvency of the Medicare program continues to be worrisome. President Biden proposes to increase the Medicare tax rate from 3.8% to 5% on earned and unearned income above $400,000, and also eliminate a tax loophole that allowed certain business owners to avoid paying Medicare taxes on a portion of their income. A budget element that always attracts much attention is “earmarks.” Legislators are especially fond of them because it makes it possible to spend money on pet endeavors in states and congressional districts that curtail the ability of the Executive Branch to manage the fund allocation process. Representative Robert Aderholt (R-AL), who heads the House Appropriations Labor-Health and Human Services-Education Subcommittee, has decided to ban these congressionally directed spending requests from his panel’s FY 2024 appropriations bill.
Apart from appropriations, Congress is working on other matters pertaining to health care. One possibility being considered is to prohibit federal agencies from using quality-adjusted life years as a metric to evaluate the cost-effectiveness of drugs and treatments. A concern is that the metric is discriminatory because it undervalues the benefits that therapies provide to individuals who have disabilities. The House Energy and Commerce Committee advanced The Protecting Health Care for All Patients Act (H.R. 485) by a vote of 27-20 along party lines. A concern is that the measure may have the potential to disrupt implementation of the Inflation Reduction Act’s Medicare drug price negotiation provisions.