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Rebecca Farley

Director, Policy & Advocacy, National Council for Behavioral Health

Budget Compromise Passes Congress; Includes Short-term Medicare Pay Fix

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Congress this week approved a bill setting top-line budget numbers for 2014 and 2015. The agreement alleviated fears of another government shutdown by paving the way for an omnibus spending package that will set programmatic spending levels for the remainder of the fiscal year. It also includes a three-month postponement of an imminent 20 percent cut to Medicare physician pay rates, giving House and Senate negotiators breathing room to finish their work on a comprehensive, permanent fix that could include the Excellence in Mental Health Act.

The compromise budget crafted by Congressman Paul Ryan (R-WI) and Senator Patty Murray (D-WA) sets 2014 spending at $1.01 trillion, lower than President Obama’s budget proposal but higher than the $967 billion that would have been in effect under the Budget Control Act and sequestration cuts. House and Senate appropriators have now turned their attention to the twelve annual spending bills that make up the budget. Major disagreements remain on some key areas of spending, such as the Labor-Health and Human Services-Education bill. The temporary resolution that continues past-year levels of government funding is currently set to expire on January 15, giving lawmakers just under a month to resolve their differences.

Temporary Medicare Patch Paves the Way for Permanent Fix; Excellence Act May Ride Along. Of note for behavioral health providers, the budget agreement  includes a temporary patch to the annual dilemma of Medicare physician payments. Without congressional action, pay rates are set to drop an estimated 20 percent next year under Medicare’s Sustainable Growth Rate (SGR) formula. The budget bill postpones that cut for three months, allowing additional time for negotiations on a permanent solution.

Lawmakers have expressed optimism that 2014 may be the year they are finally able to craft a permanent fix to the payment formula. The House and Senate committees of jurisdiction have passed similar versions of a permanent SGR repeal. The Senate Finance committee version includes a demonstration project based on the Excellence in Mental Health Act, an important bill that would bolster the community mental health and addiction treatment system. The Excellence Act has garnered growing support over the last year from Republicans and Democrats in both chambers of Congress. With its fate now joined to the Medicare bill – widely considered to be “must-pass” legislation – supporters are increasingly optimistic about its chances. This week, bill authors Senators Debbie Stabenow and Roy Blunt were joined by actress Glenn Close, the National Council for Mental Wellbeing, and other law enforcement and veterans groups to highlight the progress the Excellence Act has made and call on Congress to move swiftly to enact it. Read some of the coverage on CNN, Detroit News, and US News.