Not surprisingly, reports late Thursday said congressional Democrats have rejected Republican efforts to hold back funding for the 2010 law—President Barack Obama's signature domestic policy legislation—and indicated such a move would lead to a government shutdown. At deadline, neither representatives from Senate Majority Leader Harry Reid's (D-Nev.) office nor the White House had responded to requests for comment.
A corps of House Republicans who have promised voters they would repeal the Affordable Care Act see the spending bill showdown as their last chance before open enrollment begins on Oct. 1, according to Thomas Miller, resident fellow at the American Enterprise Institute, a right-of-center think tank. Miller said that message was reinforced for members when they returned to their districts over the August break. The way that faction sees it, he said, “there’s no going back once open enrollment begins.”
“If the dollars can flow out the Treasury to some people who are happy with it, it's another marker even beyond the Supreme Court decision where this is coming in place,” Miller said.
Paul Van de Water, a senior fellow at the left-leaning Center on Budget and Policy Priorities, also acknowledged that it will be more difficult for lawmakers to talk about repealing the healthcare law after open enrollment begins, particularly if they have nothing comparable to put in its place.
Van de Water said he thinks Republican House members will reach some agreement on a continuing resolution, and that it's “quite likely” that measure will include defunding the Affordable Care Act, even though they don't want to be responsible for a government shutdown.
“At issue is what form that will take and how difficult the House will make it for the Senate to strip it out of the basic measure,” Van de Water said, “but I think it seems very likely that the House will attempt to do something symbolic along those lines.”
Meanwhile, if lawmakers can't reach agreement by Sept. 30 and government operations come to a halt, what does that mean for mandatory spending on programs such as Medicare? The answer is unclear. An August report from the Congressional Research Service (PDF), a legislative branch agency within the Library of Congress, noted that programs that are funded by laws other than annual appropriations—like entitlement programs—“may or may not be affected by a funding gap.”
For example, the report said that even though funds needed to make payments to beneficiaries may be available automatically due to permanent appropriations, those payments may be processed by employees whose salaries are provided by funding in appropriations bills.
“The lack of funds for some employees' salaries, for example, may impinge eventually on the processing and payment of new entitlement claims,” the report noted.
Amid all of these funding woes for providers is sequestration, which kicked in earlier this year. The continuing resolution from House Appropriations Committee Chairman Hal Rogers (R-Ky.) this week would hold funding for government programs at the current, post-sequestration annual rate. Ilisa Halpern Paul, managing government relations director at Drinker, Biddle & Reath, expressed concern about the future effects of sequestration on the healthcare industry.
“One of the challenges of measuring the impact of sequestration is that, for the most part, the adverse impact is not immediate,” Halpern Paul said in an e-mail. “Yet, it has a corrosive effect long term. The government does not report outcomes or earnings quarterly like the private sector,” she added. “Sequestration is a bit like a slow drip or leak—you don't really notice until the cumulative negative effect of having the ceiling caving in from water damage or the tire going flat.”
As negotiations continue over how to fund the government on a temporary basis, healthcare providers will continue operating in an environment of uncertainty that they've dealt with for some time, according to Van de Water.
“They're not going to see a lot of further changes this year,” Van de Water said. “For example, I think there will be another SGR fix, probably not the long-term fix people were hoping for, but once again a shorter-term solution,” he said. Like Halpern-Paul, he expects the 2% reduction to Medicare payments through sequestration to continue because lawmakers aren't likely to find an alternative to save that amount of money. “I'm not expecting major changes for healthcare this fall because it looks like any major budget agreement proves to be out of reach.”
