May 9, 2008
In this issue:
Previous Updates
Currently in Washington
There has been very little to report from Congress as almost all legislative action has come to a complete stop, waiting on Congressional leaders to bring the supplemental war funding bill to the floor. After rancorous deliberations in the House, Members have settled on a fragile approach that will allow policy statements about the Iraq War to be included along with limited domestic issues. One of the domestic amendments would curb or halt certain Medicaid rules of interest (see below). On the Senate side, there appears to be a wait-and-see attitude, most likely resulting in a version of the Supplemental that closely mirrors the House. The Administration is still threatening a veto if the domestic amendments get out of hand.
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Education
HEA
The House recently extended the Higher Education Act until May 31, 2008, and the Senate is expected to follow shortly. The most recent extension expired on April 30th. Staff from the two chambers has been deliberating the differences in the two approved versions of the bill and negotiations appear headed well into May. In addition to the enormous size of each bill, the biggest stumbling block to an agreement is the “state maintenance” language strongly backed by House Chairman Miller. This is the provision that would dock the federal aid of states if they slash their higher education funding to a level less than a rolling average of the previous five years. The measure has drawn vehement protests from state officials, including a letter of opposition signed by 44 governors and resolutions passed by several legislatures. Governor Perry signed the letter.
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Recommendations for HEA Conference
AAU has submitted to the leaders of the House and Senate education committees the association’s specific recommendations for conferees on the Higher Education Act (HEA) reauthorization legislation. The letter, which complements the community letter submitted on February 28, expresses appreciation for several positive elements in the House and Senate bills, including making Pell Grants available year-round, developing an easier-to-use financial aid form, and creating a new graduate fellowship program. The letter also urges conferees to retain provisions that would limit the authority of the Department of Education to regulate standards of student achievement.
The letter also identifies four areas of special concern:
- overly prescriptive requirements for teacher training, including a provision in the Senate bill that would link teacher training curricula to institutional eligibility for federal student aid;
- new requirements in the House bill pertaining to college costs, including a mandate that institutions whose tuitions rise above a certain percentage report to the Department of Education how they will reduce net tuition, and requiring institutions with the highest percentage tuition increases to create “quality efficiency task forces” to review and analyze operations and reduce net tuition;
- the number of new reporting requirements in both bills, many of which are unnecessary and/or duplicative and would impose significant compliance costs in exchange for little, if any, benefit; and
- new application and dispute resolution requirements in the Senate bill for Title VI international education programs that would set an inappropriate precedent for federal involvement in instruction and curriculum.
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Peer-To-Peer File Sharing
A group of higher education associations has sent a letter to leaders of the House and Senate education committees regarding language in the House and Senate versions of the Higher Education Act (HEA) reauthorization bill that addresses illegal peer-to-peer (P2P) file sharing on campus. The letter expresses support for language in both bills that requires colleges and universities to inform their students about campus policies regarding copyright infringement and associated penalties. However, it urges conferees to reject additional language in the House bill that would require institutions to develop plans to provide alternative music and movie services and implement technological measures to deter illegal file sharing.
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Health
Medicaid
The House plans to include the comprehensive Medicaid moratorium bill in the upcoming supplemental appropriations bill. This supplemental appropriations bill could come before the full House for a vote as early as Thursday, May 8. The Medicaid moratorium language in H.R. 5613 is contained in the domestic funding section of the supplemental bill and places or extends moratoria on seven Medicaid rules including the provider cost limit rule, the graduate medical education rule, and the hospital outpatient rule. The Senate has included a $400M increase in NIH funding in their version.
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Medicare
On the other side of the Capitol, a Medicare legislation package that aims to avoid a cut in reimbursements to physicians is expected to cost between $15 billion and $18 billion, according to Senate Finance Committee aides. As they try to find offsets to pay for the bill, Senators are considering action to reduce Medicare payments made to private insurers that provide Medicare Advantage plans. Medicare Advantage plans are paid more than traditional Medicare plans to provide additional services for beneficiaries, but lawmakers have called into question the plans' usefulness and insurers' potentially deceptive marketing practices. The program was seen as a potential pot of money last year when Congress passed a six-month patch for the potential pay cut, but some Republicans, particularly from rural areas where the plans are popular, objected.
On a side note, Chairman Baucus has been convening discussions on the Medicare package with some 50 medical provider groups, but not the American Medical Association. The AMA has been excluded from the informal meetings because it has balked at a "balloon financing" that would impose higher cuts in the future. The $8.4 billion bill under discussion in the Senate would impose a 21 percent pay cut on Jan. 1, 2010.
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Hospital Auditing
HHS plans to implement a nationwide hospital auditing system that uses private contractors to find inappropriate Medicare payments. The rollout will begin in the spring, when the department will award contracts to four private "recovery audit contractors" and phase in the audit system on a state-by-state basis. The program makes some hospitals and lawmakers uneasy, but aides say the expansion likely will not to be blocked in Congress because the Centers for Medicare and Medicaid Services has been attentive to members' concerns about a recently completed pilot program in California, Florida, and New York. In the new permanent program, CMS will make it easier for hospitals to appeal RAC claims and limit how far back auditors can look. Politically, it is difficult for lawmakers to reject the audit program completely, since the three-state pilot returned nearly $400 million to federal coffers.
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Taxes
The House Subcommittee on Select Revenue Measures recently held a hearing on tax incentives for postsecondary education, focusing on various tax benefits such as Coverdell education savings accounts, section 529 college savings or prepaid tuition-and-fee plans, U.S. education savings bonds, penalty-free withdrawals from Individual Retirement Accounts, the Hope Credit, the Lifetime Learning Credit, the deduction for tuition and fees, and the deduction for interest on student loans. It was unclear at the hearing if any legislation is pending. However, Senate Finance Committee Chairman Baucus and Ranking Member Grassley have introduced legislation aimed at providing tax relief for working families, including the college tuition tax deduction and the state and local sales tax deduction. The bill would extend the 2001 higher ed expenses deduction to the end of 2009.
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Texas Delegation: Recent Legislative Action
For a listing of recent legislation sponsored by members of the Texas delegation, visit the Recent Legislation page of our Web Site.
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