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Weekly line: 3 big takeaways from Biden's budget proposal (and why health care leaders shouldn't dismiss it)

By Heather Bell

April 15, 2021

    Last week, President Biden outlined his fiscal year 2022 spending priorities for federal departments and agencies. In any other year, the President's budget blueprint would be largely inconsequential headline news; White House budgets signal an administration's priorities on policy and spending, but they very rarely come to full fruition because the federal budget is ultimately set by Congress.

    But this year feels different. Democrats control both the White House and Congress, and they are considering using their slim majority in the Senate to re-interpret procedural rules to advance their policy goals. So, is Biden's budget a symbolic gesture or preview of what's to come? Let's explore this more.

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    The federal budget recipe

    The annual budget is created via a long process that requires Congress to write and approve 12 appropriations bills, which fund discretionary programs for the next fiscal year, as well as consider any policy or spending changes to mandatory programs such as Medicare, Medicaid, and SNAP. These measures must be passed and signed into law by the President of United States before Oct. 1, which is the start of the new fiscal year. (In recent years, Congress has missed this deadline, and instead, passed a continuing resolution while it worked on the final appropriations bills).

    This months-long process is kicked off by the White House's budget proposal in which the president, in consultation with department and agency leaders, asks Congress to set certain spending levels for federal departments. It's worth noting that what Biden released last week was not the White House's full budget proposal, it was a blueprint that outlined spending goals for discretionary programs. Biden is expected to release his full budget request—which will include desired targets and policy changes for Medicare, Medicaid, and other mandatory programs—next month.

    Key health care provisions in Biden's budget blueprint

    But that doesn't mean Biden's blueprint proposal was devoid of big health care asks. In fact, health care leaders should take note of three big themes in Biden's initial proposal.

    1. Doubling down on public health

    Public health officials for years have lamented the erosion of funding in the United States. In fact, a new study found state spending on public health remained relatively flat between 2008 and 2018. But Biden's proposal signals a change—at least at the federal level.

    HHS would get the biggest funding bump in the budget, with Biden requesting a 23.5% increase compared with the current fiscal year. $1.6 billion of that funding would go toward increasing CDC's budget to bolster public health monitoring and response at the state and federal level. Biden also proposed hundreds of millions of dollars to address non-Covid-19 public health concerns, including combating the United States' opioid epidemic.

    2. Investing money to address health inequities

    Biden's proposal also includes a $150 million increase for CDC's social determinants of health program—that’s up from just $3 million from FY 2021. The proposal also requests $200 million to reduce maternal mortalities, which disproportionately affect Black women. Biden has repeatedly signaled his intention to address inequities in health care and this is the first time we've seen Biden propose funding to deliver on this campaign promise.

    3. Reinvesting in medical research

    Biden's proposal also would give NIH a $9 billion funding increase—and $6.5 billion would go toward launching a new agency that would focus on rapidly developing treatments for Alzheimer's disease, cancer, diabetes, and other diseases.

    Why health care leaders should pay attention

    As I noted at the beginning, the President's budget typically serves as little more than an aspirational document that reinforces the administration's priorities to Congress and the public. But this year there is reason to believe that at least some of Biden's budgetary proposals could be enacted.

    That's because congressional Democrats are considering two potentially powerful procedural changes: 1) Eliminating or watering down the filibuster; and 2) passing a second reconciliation bill. Either of these changes would potentially enable Democrats to use their slim majority in the Senate to enact policies without GOP support.

    Removing the filibuster is a powerful—and controversial—move because bills passed by the simple majority would not have to adhere to strict reconciliation rules, which limit use exclusively to bills that impact the budget deficit, spending, or revenue. This means Democrats in theory could pass long-sought policy changes, such as potentially lowering the Medicare eligibility age or creating a public option for health insurance. But to do so, they would need the support of every single Democratic senator—and it doesn't look like they have it. After much speculation, Sen. Joe Manchin (D-WV). in a recent op-ed wrote, "There is no circumstance in which I will vote to eliminate or weaken the filibuster." Unless Manchin changes his mind, we may be able to table the filibuster conversation for the time being.

    Enter option number two. Late last month, Senate Majority Leader Chuck Schumer's office announced that the Senate parliamentarian—the Senate's resident expert and judge on procedural rules—said Democrats may be able to use the reconciliation process to pass at least one more bill with a simple majority. Historically, the Senate has interpreted the Congressional Budget Act to mean Congress can pass one bill related to spending, revenue, and deficit reduction each fiscal year. But this reinterpretation—which Vox's Li Zhou and Ella Nilsen reported centers on Section 304 of the Congressional Budget Act—would give Democrats the ability to amend the House- and Senate-passed fiscal year 2021 budget resolution before the end of the fiscal year, and include new instructions for an additional reconciliation bill.

    If Democrats move forward with this idea, it is no small matter. While this new reading of reconciliation bills stops short of the legislative free-for-all that could come from fully eliminating the filibuster, it would mark a significant shift in how Congress approaches the budget and reconciliation process—and serve as an impactful procedural tool for whichever party holds the majority. For Democrats, it gives them the option to pass Biden's infrastructure bill—and potentially some of his bigger budget health care items—without Republican support.

    At Advisory Board, we'll be watching to see how Democrats approach these procedural questions and how that changes the political realities of health policies they could enact.

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