D.C. Report: Congress Moves Forward on Two Separate Federal Funding Tracks

President Obama released his federal fiscal year 2012 Budget Request to Congress on Monday, Feb. 14. The overall budget request is for $3.73 trillion, and aims to reduce the deficit by $1.1 trillion over the next decade two thirds through a five-year freeze on domestic, discretionary spending, cutting more than 200 federal programs, and one third through tax increases. The Republican leaders in the House of Representatives are particularly opposed to the level of spending and taxation involved, and they intend to propose additional budget reductions. They maintain that additional taxes even on the rich are inappropriate with the current state of the economy, and that this level of deficit reduction is inadequate, and will continue to be an unacceptable drag on the economy. We will provide additional updates as the details are released and any impact on Health IT is evaluated.

The annual federal budget process was kicked off the today’s release of the President’s Budget Request to Congress. Between now and mid-April, the President’s budget will undergo a series of Congressional hearings, before a Budget Resolution is drafted to set spending limits for the federal fiscal year that begins October 1, 2011. The final and most difficult step is getting Congress to agree on appropriations levels for the next fiscal year and to pass the 12 appropriations bills. There are at least seven bills that have been introduced in the House and Senate that are intended to reduce the federal budget deficit that will not be subject to the committee and hearings process and ultimately have to be reconciled with the President’s Budget Request submitted today.

Additionally, the federal government has been operating under a Continuing Resolution Authority since October 1, 2010, because the previous Congress could never pass the twelve appropriations bills for FY 2011 necessary to operate the federal government. That interim Congressional authority to operate the federal government at levels not exceeding last year’s budget runs out on March 4, 2011. This week, Congress released a draft of the proposed Continuing Resolution intended to keep the federal government operating through September 30th at FY2010 levels. At this early stage, it appears that the proposed Continuing Resolution Authority keeps healthcare IT initiatives funded at their expected levels, including the funds for the Medicare and Medicaid EHR incentive programs. The budget plan presented by the Obama administration to Congress on Monday is completely separate, of course, as it covers fiscal year 2012, not this year.