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Time For a Budget Update

A quick (and simplified) refresher on how the federal budget process is supposed to work:

A quick (and simplified) refresher on how the federal budget process is supposed to work:

On the first Monday in February, the president releases a detailed budget request for the upcoming fiscal year. It recommends how much money the federal government should spend and what it should spend it on. It also articulates how much the government should take in as tax revenues. From there, the House and Senate each come up with their own blueprint, then spend the year working on an agreement which is finalized by October 1.

Now take that paragraph above (which is probably what you learned in high school civics and Schoolhouse Rock) and toss it into the round file. It has been ages since the process was that simple. Instead, partisanship, gridlock, and other issues have caused the budget process to break down. Blame can be assigned to both Houses of Congress as well as both parties; until this year, the Senate hadn’t produced a budget since 2009. The Republican-controlled House passed budget resolutions spearheaded by Rep. Paul Ryan (R-WI, and former vice presidential candidate) that had no chance of passing the Democrat-controlled Senate. Long story short, Congress was forced to continually adopt stopgap spending measures to keep government programs running while never actually finalizing a budget.

This brings us to 2013, the most unusual budgetary year in some time. Let’s review in timeline format:

February 4 (first Monday in February): The president’s budget is normally released on this date, but no one inside the Washington, D.C. beltway expects a budget proposal before March. Congress and the president are still extricating themselves from the fiscal cliff, and it would take some time to run the numbers and create a new budget. They also need to attempt to stave off the across-the-board cuts known as the sequester.

March 1: Unable to reach a compromise, the sequester takes effect, triggering $1.2 billion in cuts spread over nine years.

March 15: Paul Ryan introduces his budget blueprint. Very similar to his 2012 budget proposal, the plan again calls for converting Medicaid into a block-grant program for states, and repeals the Medicaid expansion, exchanges, and other provisions that were passed as part of the Affordable Care Act.

Also on March 15, the Senate Budget Committee begins work on the Senate’s first budget proposal in four years. The proposal includes an important amendment offered by Sens. Bill Nelson (D-FL), Chris Coons (D-DE), and Tammy Baldwin (D-WI) that would help advance care for medically complex children under Medicaid.

March 21: The House passes the Ryan budget by a vote of 221-207. The Senate votes on – and overwhelmingly rejects – the Ryan budget the same week.

March 22: With a government shutdown looming, Congress passes a bill to fund all federal programs through September 30 (freeing them from having to reallocate all the money). Most programs, such as the Children’s Hospital Graduate Medical Education program (CHGME) are funded at last year’s levels in the bill – however, because of sequestration, each program is subject to a five percent cut (and possibly more, depending on how much discretion individual agencies are able to apply in implementing the the cuts. Confused yet? So was Washington. And we’re still waiting to find out officially what final FY 2013 funding for CHGME and other programs will look like. (Medicaid, fortunately, is not subject to sequestration cuts.)

March 23: The Senate narrowly passes its budget proposal by a vote of 50-49. The Senate’s budget proposes $10 million in Medicaid cuts, but takes care not to hurt current beneficiaries or jeopardize expansion of the Affordable Care Act.

April 10: The president releases his budget proposal; a bit of a moot point as both the House and Senate have passed theirs, but it does reveal some of the administration’s policy ideas. The president’s proposal avoids short term Medicaid cuts, but – as it did in 2012 - recommends $88 million for CHGME, just one-third of the current funding for the program.

And that brings us up to date. Congress will now begin sort out specific funding amounts for all federal programs, including Medicaid and CHGME. Recently, a group of 26 senators signed on to a letter supporting CHGME funding, as did 138 representatives. As the appropriations process heats up in the coming weeks, we’ll be asking you to reach out to your legislators as well through our Legislative Action Center.


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