What it Means for Health Care

Alliance for Health ReformSeptember 12, 2011

Katherine HayesThe George Washington University School of Public Health and Health ServicesDepartment of Health Policy

Budget Control Act of 2011: OverviewDebt CeilingBalanced Budget Amendment VoteJoint Select Committee on Deficit ReductionEnforcement

Sequestration (of discretionary spending in a given FY)

Sequestration of up to $1.2 billion if no deficit reduction enacted and revision of discretionary spending caps

Education Provisions (not addressed today)

Debt Ceiling Increase: Three-steps $2.1 (or up to $2.4 trillion)$400 billion – Presidential certification (August

2, 2011)$500 billion – 50 calendar days after initial

certification (September 21, 2011)$1.2 t0 $1.5 trillion

$1.2 billion – $0 to 1.2 billion in deficit reduction enacted

$1.2-1.5 billion – Actual deficit reduction amount enacted

$1.5 billion – Constitutional amendment on balanced budget passes

Balanced Budget AmendmentCongress must vote on a balanced budget

amendment to the ConstitutionSeptember 30 – December 31, 2011If both Houses approve, debt ceiling can be

increased by $1.5 trillionExpedited procedures for 2nd chamber

consideration

Limits on Discretionary Spending10 year “adjustable” statutory limits

(appropriations caps) for FY 2012-2021FY 2012 and FY 2013 - Equally split between

Security (DoD, DHS, DVA, NNSA, intelligence, international affairs)

Non-security (everything else)FY 2014-2021 – no split between security and

non-securityEnforcement

Annual Enforcement of Discretionary Spending Caps15 days after end of a Congressional sessionIf appropriations within a category is exceed,

sequestration is triggered in “nonexempt” accounts.

President issues sequestration order within category breached (security v. non-security) in FY 2012-13

Congress can modify sequestration order (expedited procedure)

Joint Select Committee on Deficit ReductionDeficit reduction target of at least $1.5

trillion FY2012-2021Expedited procedure for consideration of

legislation (if any) reported by Super Committee

If no deficit reduction legislation enacted by January 15, 2011, (minimum of $1.2 trillion) automatic spending reductions go into effect on January 2, 2013 (unless there is intervening legislation).

Super Committee DeadlinesAugust 16, 2011 – Appointment of MembersSeptember 16, 2011 – Committee must begin meetingOctober 14, 2011 – House and Senate Committees

may make recommendationsNovember 23, 2011 – Committee must vote on

proposed deficit reduction legislation and report December 2, 2011 – If adopted, transmit to President,

VP and House and Senate leadersDecember 9, 2011 – Committees of jurisdiction reportDecember 23, 2011 – Final passage January 15, 2012 – Sequestration fallback if no law

enactedJanuary 31, 2012 – Committee dissolved

Joint Select Committee on Deficit Reduction – House MembersHouse

Speaker Boehner (R-OH) Jeb Hensarling (R-TX) – Committee co-chair Dave Camp (R-MI) Fred Upton (R-MI)

Minority Leader Pelosi Chris Van Hollen (D-MD) Jim Clyburn (D-SC) Xavier Becerra (D-CA)

Joint Select Committee on Deficit Reduction – Senate MembersSenate

Majority Leader Reid (D-NV) Patty Murray (D-WA) – Committee co-chair Max Baucus (D-MT) John Kerry (D-MA)

Minority Leader McConnell (R-KY) Pat Toomey (R-PA) John Kyl (R-AZ) Rob Portman (R-OH)

Deficit Reduction FallbackIf Super Committee bill is passed by January 15,

2012:Automatic spending reductions of amount full

$1.2 billion or any shortfallDiscretionary caps revised: equally split between

security and non-security (note)Proportional division between discretionary and

direct spendingCertain direct spending exempt or limited (Social

Security, Medicaid, and others, Medicare – 2%)Spending reductions beginning January 2, 2013