Congressional Budget Appropriators Must Find $900M for Implementation of 2003 Medicare Law

Main Category: Medicare / Medicaid / SCHIP
Article Date: 14 Jun 2005 - 2:00 PDT

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When the House Labor-HHS Appropriations Subcommittee convenes on Thursday to consider a $142.5 billion fiscal year 2006 budget proposal, lawmakers will face the challenge of finding about $890 million to fund implementation of the 2003 Medicare law while enacting cuts to other social programs, CongressDaily reports. According to CongressDaily, the Medicare law mandated $1.5 billion in direct spending not subject to appropriations for implementation of its the new prescription drug benefit and other programs in 2004 and 2005. However, beginning in FY 2006, the law did not require additional mandatory startup spending. The Bush administration in its FY 2006 budget request asked for $560 million for CMS costs related to the Medicare law -- including beneficiary education, contracting with private health plans and developing new data systems to enroll beneficiaries and track funding -- as well as $320 million for the Social Security Administration, which is charged with helping CMS determine eligibility for subsidies available to low-income beneficiaries under the new drug benefit. The pressure to appropriate the necessary funds is compounded by the fact that the $142.5 billion budget measure already is $163 million less than the previous year. Aides to Rep. David Obey (D-Wis.), ranking member in the House Appropriations Committee, said he is preparing for a "major dustup" with Republicans over proposed cuts to programs to fill the gap, CongressDaily reports. A spokesperson for Republicans on the committee expressed confidence in lawmakers' ability to fill the gaps. However, Sen. Tom Harkin (D-Iowa), ranking member on the Senate Labor HHS Appropriations Subcommittee, said the Senate panel is working to avoid large cuts to social services in its own proposal, which lawmakers will consider later this summer (Cohn, CongressDaily, 6/8).

Enrollment Confusion
In related news, CMS said this week that an "unknown number" of Medicare beneficiaries have received empty envelopes instead of letters informing them about eligibility requirements for financial subsidies under the new drug benefit. CMS conducted its first mass mailing of the education effort last month, sending information to 4.7 million low-income beneficiaries. However, in a posting on a drug benefit listserve, it was reported that CMS said it had received several calls about errors in the mailings in which the envelopes that beneficiaries received were empty. A Medicare spokesperson said Tuesday that the number of affected envelopes might be small -- perhaps 6,000 -- and not is not concentrated in any one state (Rovner/Heil, CongressDaily, 6/8).

Humana Expands Medicare Offerings
Meanwhile, Humana announced on Tuesday that it plans to offer various Medicare Advantage plans in 46 states next year, up from 25 states previously. Currently, Humana offers local HMOs and PPOs under Medicare but will expand its offerings to include regional PPOs and Medicare Prescription Drug Plans (CQ HealthBeat, 6/7).

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