March 25, 2016

Budget and Appropriations Battle Simmers in House

Another intraparty battle over how much the federal government should spend in the 2017 Fiscal Year (FY) threatens to derail House Republican efforts to pass a budget resolution and complete the appropriations process. The American College of Radiology (ACR) is closely monitoring whether opposition from the Freedom Caucus, a collection of the most conservative members of the Republican conference, may force the House Republican leadership to renege on a previously enacted bipartisan budget agreement and acquiesce to additional cuts in Medicare or other mandatory spending programs.

Throughout the Obama Administration, the conservative Republican legislators who would form the Freedom Caucus in 2015 have consistently applied pressure on House Republican leadership to rein in federal spending. These hard line tactics made it extremely difficult for Congress to complete many routine governing functions including passing a yearly budget resolution, enacting appropriations bills to fund the various functions of the federal government and raising the nation’s debt ceiling.

Despite the recent contentious battles, the passage of the Balanced Budget Act (BBA), a two-year budget agreement which capped total federal spending at $1.07 trillion in FY 2017 and preceded the immediate resignation of former Speaker John Boehner (R-OH) in October 2015 was designed to free the House of Representatives from the annual paralysis over federal spending. House and Senate lawmakers from both parties jointly negotiated the BBA in conjunction with the Obama Administration, and the legislation passed both chambers with strong bipartisan majorities.

Citing continuing concerns about federal spending and the growing national debt, the approximately 40 members of the Freedom Caucus recently announced that they will withhold support from any budget resolution or corresponding appropriations bill that authorizes $1.07 trillion in total spending. In its place, the, caucus is asking the House leadership for a new budget resolution that caps federal spending next year at $1.04 trillion, thus requiring an additional $30 billion in cuts to mandatory spending programs. The caucus’ proposal conflicts with actions by the House Budget Committee that led to its March 16 passage of a FY 2017 budget resolution that honors the BBA’s higher spending figure.

Continued inflexibility by the Freedom Caucus may result in the inability of the House to pass a federal budget or annual appropriations bills because many Freedom Caucus members who serve on this committee vowed to vote against the final package on the House floor if total spending isn’t ultimately lowered to $1.04 trillion. If this were to occur, it would cause severe embarrassment to the House Republican leadership, especially new Speaker Paul Ryan (R-WI), during a contentious election year.
The angst toward the federal budget is isolated to the House, however, as Senate Majority Leader Mitch McConnell (R-KY) has already indicated, his chamber will at least pass appropriations legislation that honors the agreement to cap total federal spending at $1.07 trillion.

The ACR government relations office will continue to monitor the contentious budget and appropriations negotiations in the House. The College will pay particularly close attention to any attempt by the Freedom Caucus to include site-neutral payment policies or legislation to equalize Medicare payment rates between hospital outpatient departments and physician offices within any alternative budget or appropriations proposal. ACR members are urged to closely monitor the Advocacy in Action newsletter for the latest on the fiscal battles within the House of Representatives.