BREAKING: Government Shutdown Looms as Spending Talks Collapse
As of Friday morning, December 19, the chances of a federal government shutdown increased dramatically after a series of completely unprecedented developments emerged that threw the process of legislating federal government appropriations into near-chaos. The situation was totally unprecedented, and with the collapse of bipartisan negotiations over funding, a number of significant healthcare policy and payment provisions were left hanging in the balance, among them, an effort to address a looming physician pay cut, and the extension of telehealth flexibilities into next year.
The situation as of midday Friday remained exceptionally fluid, as members of Congress had perhaps just hours to avert a federal government shutdown.
In a breaking-news report that they published at 6 a.m. eastern time on Friday, the Washington Post’s Jacob Bogage and Marianna Sotomayor wrote that “The federal government is careening toward a weekend government shutdown deadline as congressional Republicans, egged on by President-elect Donald Trump and Elon Musk, feud over legislation to keep agencies open over the Christmas holiday. Republicans on Wednesday rejected a plan by House Speaker Mike Johnson (R-Louisiana) for a three-month stopgap funding extension, called a continuing resolution or CR, with more than $100 billion in aid for natural disaster survivors, bipartisan health-care policy changes and other unrelated provisions.”
What’s more, Bogage and Sotomayor wrote, “In scrapping Johnson’s plan, Republicans cast doubt on his ability to maintain the speaker’s gavel in next year’s Congress. Johnson must run for the position again when the new House is sworn in on Jan. 3, and enough GOP lawmakers to deny him the position have already declared they won’t support him, according to two members who spoke on the condition of anonymity to describe private conversations.”
And, they wrote, “’I am hearing from an increasing number of people, both inside and outside the Freedom Caucus, that they’re not viewing how this was handled favorably,’ Rep. Andy Harris (R-Maryland), chair of the pugnacious and ultraconservative Freedom Caucus, separately told The Washington Post on Tuesday.”
Meanwhile, the New York Times’s Catie Edmonson and Carl Hulse wrote in a breaking-news report late Thursday evening that “A bipartisan spending deal to avert a shutdown was on life support on Wednesday after President-elect Donald J. Trump condemned it, leaving lawmakers without a strategy to fund the government past a Friday night deadline. Mr. Trump issued a scathing statement ordering Republicans not to support the sprawling bill, piling on to a barrage of criticism from Elon Musk, who spent Wednesday trashing the measure on social media and threatening any Republican who supported it with political ruin. It was not yet clear how Speaker Mike Johnson planned to proceed as the package, which was stuffed full of unrelated policy measures as well as tens of billions of dollars in disaster and agricultural aid, appeared to be hemorrhaging support. Some Republicans suggested he was mulling stripping the bill of everything but the spending extension and putting it to a vote, but the fate of such a measure was also very much in doubt.”
Further, they wrote, “The blowback from Republicans to the agreement underscored the complications top G.O.P. leaders will have to manage next year when they control all of Congress and face a president with a penchant for blowing up political compromises. It also showed the power of a circle of influential outside players in Mr. Trump’s orbit who appeared willing to punish Republicans if they failed to accede to his wishes. Even before Mr. Musk began making noise, a swell of Republican lawmakers — both ultraconservatives and some mainstream members — had been furious about the funding measure, which was rolled out on Tuesday night. It began as a simple spending bill to keep government funds flowing past a midnight deadline and into mid-March, but it emerged from bipartisan negotiations laden with $100 billion in disaster aid and dozens of other unrelated policies.”
And, the Times reporters noted, “The G.O.P. resistance meant that in order to pass the bill, Mr. Johnson was going to have to rely, yet again, on Democratic votes to pass it, using a special procedure that requires the support of two-thirds of those voting. But by Wednesday afternoon, the backlash to the legislation had spread so far and wide in G.O.P. ranks that it was unclear whether he would even be able to muster a bare minimum of Republicans to partner with Democrats and push it across the finish line.”
Important healthcare provisions now in doubt
The U.S. Congress for several years has come to rely more and more on continuing resolutions or “CRs,” to keep the federal government running, when formal budget negotiations stall. The CRs remain stopgap measures that keep the federal government running on a temporary basis, which is why their collapse can cause actual federal government shutdowns; that is what is at stake in this instance. In a federal government shutdown, only essential government operations are protected, while federal employees become furloughed and the vast majority of functions cease.
Among the healthcare-related provisions in the bipartisan CR that Republicans and Democrats in the House of Representatives had spent numerous weeks negotiating into approval were the extension of telehealth flexibilities through the end of 2026, an increase APM (alternative payment model) incentive payments to 3.53 percent, and an extension of the 1.0-percent Medicare work GPCI (geographic practice cost increase floor), all provisions that would have helped physicians and medical groups in particular. Now, those provisions are in limbo, and the telehealth flexibilities are set to expire.
This situation is exceptionally fluid right now; Healthcare Innovation will update readers as new developments emerge.
