Capitol Hill Update, 23 March, 2015
House & Senate/Schedule: Both chambers are in town for one more frantic week before recessing for two weeks. Congress will be back in session on April 13th.
Legislative Highlight of the Week: The main event in Congress this week is going to be the votes on budget resolutions for Fiscal Year 2016 in both House and Senate. You can read more about the upcoming budget process HERE.
House/Spending: House Republicans, led by new Budget Committee Chairman Tom Price (R-GA) have put forth a budget plan very much in the tradition of Rep. Paul Ryan’ s budgets in past years. The Price Budget proposes a large number of very positive reforms, including:
- balancing the budget in nine years,
- making the tax code simpler and flatter (with a 25% maximum rate for individuals),
- sending Medicaid, S-CHIP, and food stamp entitlements to the states as block grants, and
- being willing to make major structural reforms to save Medicare.
There are some downsides to the House budget, including that it keeps tax revenues at current levels (ObamaCare levels of taxation), it doesn’t touch Social Security, and its Medicare reforms don’t take effect for a decade. It also increases emergency war funds to boost defense spending instead of finding ways to offset that spending within the budget.
House/Budget: The Republican Study Committee has introduced its annual conservative alternative to the main House budget, which does improve upon the main GOP budget in several areas – most notably by balancing the budget in only five years. The RSC’s budget will be one of several alternatives to the main House budget that receives a vote on Wednesday.
Senate/Budget: The Senate will vote on its own budget, which is in some ways slightly weaker than its House counterpart. It takes slightly longer to achieve balance, does not address Medicare with specific reforms, and does not set a specific maximum on tax rates. The Senate will vote on a number of amendments to the budget throughout the week, followed by a day-long “vote-a-rama” that will feature dozens of amendment votes.
House & Senate/Medicare: The House and Senate have been crafting a deal on a bill to permanently address the “doc fix”, which the House is expected to pass on Thursday. For over a decade, Congress has passed an annual patch to the Sustainable Growth Rate, a program that if allowed to go into effect would cut Medicare reimbursements to doctors by over 20%.
One problem with the “doc fix” is that it counts as an expense – nearly $200 billion over 10 years – meaning that Congress has to find a way to offset the extra spending with cuts elsewhere. The plan that is being released shortly does not seem to actually offset the new spending – meaning that less than one day after passing a budget plan, the House would already be spending above its limit.