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Capital Thinking

Prospects for Modernization of the TSCA During the 114th Congress

Posted in General Legislative

Just prior to the Easter Recess, the House and the Senate approved budget resolutions for the first time in six years.  More significantly, House Speaker John Boehner and Minority Leader Nancy Pelosi found common ground to move major bipartisan entitlement reform legislation through the House. For example, after more than a decade of trying, the House was able to agree to a permanent “doc fix” bill. Modernization of the Toxic Substances Control Act (TSCA), the 1976 law governing the commercial use of toxic chemicals, could be the next “under-the-radar” bill to move through Congress.

With congressional leaders eager to schedule votes on and pass meaningful economic legislation that will further demonstrate the ability of the new Congress to govern and to focus on economic matters, which continue to be a top priority for American voters. The recent vote in the House of Representatives to address the “doc fix” illustrates that significant legislation can pass in the current Congress, particularly when it is legislation that is truly bipartisan in nature and has not become a lightning rod for partisan warfare. We think TSCA reform could be next.

For more on our analysis, please click here.

House to Consider Financial Services, Tax Bills; Senate to Vote on Confirmation of District Judge

Posted in General Legislative

Senate Legislative Activity

On Monday, April 13, the Senate will convene at 2:00pm. Following any Leaders remarks, the Senate will be in a period of morning business, with Senators permitted to speak for up to 10 minutes each.  At 5:00pm, the Senate will enter into an Executive Session to consider Calendar #23, Alfred H. Bennett, of Texas, to be U.S. District Judge for the Southern District of Texas. After 30 minutes of debate that has been equally divided, the Senate will hold a roll call vote on the confirmation of the nomination at approximately 5:30pm.

House Legislative Activity

On Monday, April 13, the House will meet at 12:00pm for morning hour and at 2:00pm for legislative business, with votes postponed until 6:30pm. The following legislation will be considered under suspension of the rules:

  1. H.R. 299 – Capital Access for Small Community Financial Institutions Act of 2015;
  2. H.R. 1259 – Helping Expand Lending Practices in Rural Communities Act;
  3. H.R. 1265 – Bureau Advisory Commission Transparency Act;
  4. H.R. 601 – Eliminate Privacy Notice Confusion Act;
  5. H.R. 1367 – To amend the Expedited Funds Availability Act to clarify the application of that Act to American Samoa and the Northern Mariana Islands; and
  6. H.R. 1480 – SAFE Act Confidentiality and Privilege Enhancement Act

On Tuesday and Wednesday, April 14 and 15, the House will meet at 10:00am for morning hour and at 12:00pm for legislative business. On Thursday, April 16, the House will meet at 9:00am for legislative business, with last votes expected by 3:00pm. The following legislation will be considered under suspension of the rules:

  1. H.R. 1058 – Taxpayer Bill of Rights Act of 2015;
  2. H.R. 1152 – IRS Email Transparency Act;
  3. H.R. 1026 – Taxpayer Knowledge of IRS Investigations Act;
  4. H.R. 1314 – Ensuring Tax Exempt Organizations the Right to Appeal Act;
  5. H.R. 1295 – IRS Bureaucracy Reduction and Judicial Review Act;
  6. H.R. 709 – Prevent Targeting at the IRS Act;
  7. H.R. 1104 – Fair Treatment for All Gifts Act;
  8. H.R. 1562 – Contracting and Tax Accountability Act of 2015; and
  9. H.R. 1563 – Federal Employee Tax Accountability Act of 2015, as amended

The House will also consider:

  1. H.R. 650 – Preserving Access to Manufactured Housing Act of 2015 (Subject to a Rule);
  2. H.R. 685 – Mortgage Choice Act of 2015 (Subject to a Rule);
  3. H.R. 622 – State and Local Sales Tax Deduction Fairness Act of 2015 (Subject to a Rule); and
  4. H.R. 1105 – Death Tax Repeal Act of 2015 (Subject to a Rule)

On Friday, April 16, no votes are expected in the House.

House and Senate Budget Conference; House Subcommittees to Mark Up Appropriations Bills

Posted in Budget and Appropriations

Legislative Activity

House and Senate Budget Conference

The House and Senate Budget Committees are working towards a budget resolution that will pass both the House and the Senate. The Budget Committee Chairmen, Representative Tom Price (R-GA) and Senator Mike Enzi (R-WY), returned early from the two-week recess to discuss the budget resolutions, as they try to negotiate an agreement. Both Chairmen had wanted to finalize a budget agreement by the April 15 deadline, but it seems unlikely to happen given that they still need to appoint conference committee members, finish negotiating the agreement, and vote on the final resolution. Missing the deadline has few consequences, and the Chairmen are expected to appoint conferees this week.

While both the House and Senate budget resolutions would balance the budget within ten years and would add around $96 billion in defense spending, there are significant differences between the resolutions that still need to be resolved. The Senate resolution included a procedural provision subjecting $38 billion in defense spending to a “point of order,” which defense hawks and House negotiators want removed.

The point of order would effectively require 60 votes in the Senate to approve the funds, and defense hawks are concerned that Republicans will lack the necessary Democratic votes. Democrats have been calling for an increase in domestic discretionary spending to match any defense spending increase. It is unclear if fiscal hawks in the Senate would vote for the final resolution without the point of order, which they view as necessary to ensure that increased defense spending would not add to the deficit.

Passing a final budget resolution is important to Republicans as they seek to show that they can govern while in control of both houses of Congress; it will also allow them to use a process known as reconciliation to send Obamacare repeal to the President’s desk. Reconciliation does not require 60 votes in the Senate.

House Subcommittees to Mark Up Appropriations Bills

The House appropriations committee Military Construction and Veterans Affairs and Energy and Water Development subcommittees will hold markup hearings on their respective appropriations bills this week. The bills will likely be the first to reach the House floor, during the week of April 27, and will be debated under regular order allowing Members to offer a large number of amendments. House Majority Leader Kevin McCarthy (R-CA) has warned House Representatives they may be holding votes late into the evenings on the appropriations bills.

The Military Construction-Veterans Affairs bill will be easier to move, as it usually garners large bipartisan levels of support. The Energy-Water bill will be more difficult given the Republicans’ frustration with the Environmental Protection Agency (EPA), even though the EPA is not funded through the bill, and Republicans may add controversial policy riders to the bill.

House Appropriations Committee Chairman Hal Rogers (R-KY) has said he wants to move all 12 appropriations bills through Congress by October 1, the start of fiscal year 2016. However, President Obama has stated he will not sign appropriations bills that follow the sequestration limits, advocating for a budget deal to raise both defense and domestic discretionary spending above the limits; Democrats and defense hawks also want to increase spending.

This Week’s Hearings:

  • Wednesday, April 15: The Senate Appropriations Committee Homeland Security Subcommittee will hold a hearing titled “From Protection to Partnership: Funding the DHS role in Cybersecurity.”
  • Wednesday, April 15: The House Appropriations Committee Defense Subcommittee will hold a Members Day hearing on the fiscal year 2016 budget.
  • Wednesday, April 15: The House Appropriations Committee Energy and Water Development Subcommittee will hold a markup hearing on the Energy-Water Appropriations bill.
  • Wednesday, April 15: The House Appropriations Committee Military Construction, Veterans Affairs, and Related Agencies Subcommittee will hold a markup hearing on the Military Construction-Veterans Affairs Appropriations bill.

Senate Appropriations Committee FY 2016 Budget Hearings

  • Wednesday, April 15: The Military Construction, Veterans Affairs, and Related Agencies Subcommittee will hold a hearing on the Budget Request for Combatant Commanders for Select Defense Agencies.
  • Thursday, April 16: The Labor, Health and Human Services, Education, and Related Agencies Subcommittee will hold a hearing on the Budget Request for the Department of Education.
  • Thursday, April 16: The Commerce, Justice, Science, and Related Agencies Subcommittee will hold a hearing on the Budget Request for the National Aeronautics and Space Administration.

House Appropriations Committee FY 2016 Budget Hearings

  • Tuesday, April 14: The Labor, Health and Human Services, Education, and Related Agencies Subcommittee will hold a hearing on the Budget Request for Early Education programs.
  • Tuesday, April 14: The Defense Subcommittee will hold a hearing on the Budget Request for the Defense Health Program.
  • Wednesday, April 15: The Labor, Health and Human Services, Education, and Related Agencies Subcommittee will hold a hearing on the Budget Request for Ebola programs.
  • Wednesday, April 15: The Homeland Security Subcommittee will hold a hearing on the Budget Request for Immigration and Customs Enforcement.
  • Wednesday, April 15: The Financial Services and General Government Subcommittee will hold a hearing on the Budget Request for the Securities and Exchange Commission.
  • Wednesday, April 15: The State, Foreign Operations, and Related Programs Subcommittee will hold a hearing on the Budget Request for the United Nations and International Organizations.

House Homeland Security Committee to Mark-Up Cyber Information Sharing Bill; Cyber Week Scheduled in the House

Posted in Cybersecurity

Legislative Activity

House Homeland Security Committee to Mark-Up Cyber Information Sharing Bill

On Tuesday, the House Homeland Security Committee will mark up the National Cybersecurity Protection Advancement Act, which will officially be introduced on Monday. The Committee has worked collaboratively with the private sector and stakeholders to develop the legislation for the last few weeks. . The bill would make the U.S. Department of Homeland Security (DHS) as the main agency in charge of facilitating cyber threat information sharing between the federal government and the private sector and would codify existing activities with cyber information sharing. It also includes liability protections for companies that share information with the federal government, which was a priority for Committee Chairman Michael McCaul (R-TX) and Ranking Member Bennie Thompson (D-MS).

Cyber Week Scheduled in the House

The House has named April 21-23 as its annual “Cybersecurity Week” and plans to consider a number of cybersecurity bills during that week. It is likely that the National Cybersecurity Protection Advancement Act and the House Intelligence Committee’s information sharing bill – the Protecting Cyber Networks Act (H.R. 1560) – will be part of the package of bills that will be considered on the House floor next week. House leadership has discussed the possibility of combining the two bills prior to moving them to the floor so they can be considered at the same time. While both bills cover information sharing issues, each focuses on its respective areas of committee jurisdiction, with House Homeland Security Committee bill focusing on DHS while the House Intelligence Committee focuses on the Intelligence Community. Additionally, it is also possible that the House will consider the House Energy and Commerce’s data breach notification and data security bill next week after it is likely to be marked up in the full committee at some point this week.

It is also possible that the Senate will consider the Senate Select Committee on Intelligence’s information sharing bill – the Cybersecurity Information Sharing Act (CISA/S. 754) – on the Senate floor as early as this week or next week.

This Week’s Hearings:

  • Tuesday, April 14: The House Homeland Security Committee will mark up the National Cybersecurity Protection Advancement Act.
  • Tuesday, April 14: The Senate Armed Services Subcommittee on Emerging Threats and Capabilities will hold a hearing titled “Military Cyber Programs and Posture.”
  • Wednesday, April 15: The Senate Appropriations Subcommittee on Homeland Security will hold a hearing titled “From Protection to Partnership: Funding the DHS Role in Cybersecurity.”

Regulatory Activity

NIST to Issue Draft Framework for Cyber-Physical Systems

Last week, the National Institute of Standards and Technology (NIST) held its second workshop for the Cyber-Physical Systems Public Working Group. The workshop allowed participants to review the framework of standards for cyber-physical systems which include the Internet of Things, Industrial Internet, Smart Grid or “smart” items such as smart cars, smart homes, smart buildings, etc. NIST plans to issue the framework for public comment in May or June and hopes to release the final framework in 2016.

Senate HELP Committee to Mark Up ESEA Legislation

Posted in Education

Legislative Activity

Senate HELP Committee Will Mark Up ESEA Legislation on Tuesday

Senate Health, Education, Labor, and Pensions (HELP) Committee Chairman Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA) released a bipartisan compromise ESEA reauthorization bill last Wednesday. The Every Child Achieves Act of 2015 is scheduled for markup on Tuesday. The Committee leaders have touted the smaller federal role and increased flexibility for states and districts provided in the bill. For example, the bill maintains the current annual testing requirement – a necessary provision for most Democrats – but would allow states to determine the weight of such tests in accountability systems, while also providing flexibility for states to pilot innovative assessment systems. Additionally, the legislation would allow states to design their accountability systems but requires them to meet certain federal parameters such as test scores, graduation rates, measures of postsecondary education or workforce readiness, and English proficiency for English learners. Such systems also must include all students and subgroups of students, disaggregate student achievement data, and establish challenging academic standards for all students. The federal government, however, is prohibited from developing or approving such standards.

The Every Child Achieves Act of 2015 does not include many controversial issues that have played out in the ESEA debate, such as portability of Title I funds and the lack of a dedicated high-quality early learning program. However, debate on those issues and a healthy amendments process are expected during both committee and floor consideration of the bill.

Thus far, much of the stakeholder feedback has been positive about the bipartisan deal. Teachers’ unions, for example, are happy to see the elimination of high-stakes testing, and disabilities groups have praised the one-percent rule to help ensure more students with learning disabilities are participating in the general state assessments. The Obama Administration has even applauded the bipartisan nature of the bill, though Secretary of Education Arne Duncan continues to express doubts about whether the compromise measure will survive the reauthorization process, particularly in the House where efforts have stalled and key components are far apart from the Senate version. To date, the House has not announced if or when it will continue consideration of the Student Success Act (H.R. 5). Additionally, the bill was not included in House Majority Leader Kevin McCarthy’s (R-CA) memo last week to House members concerning legislation to be considered on the floor in the coming month.

House Committee Circulates Draft FERPA Legislation

Last week, House Education and the Workforce Committee staff began circulating a draft bill that would update the Family Educational Rights and Privacy Act (FERPA) of 1974. This bill would be a complement to the Student Digital Privacy and Parental Rights Act, which Reps. Luke Messer (R-IN) and Jared Polis (D-CO) plan to introduce in the coming weeks despite receiving heavy criticism from parent groups and privacy advocates prior to the Congressional recess. The Committee does not have a defined timeline for introduction of the FERPA legislation but plans to move it separately from the reauthorization of the Elementary and Secondary Education Act (ESEA) and the Higher Education Act (HEA).

The House continues to wait for the leadership to give additional floor time to continue the consideration of the Student Success Act (H.R. 5), which is currently on hold. Meanwhile, House Education and the Workforce Committee Chairman John Kline (R-MN) and his staff continue to re-educate members about the bill’s provisions. They are optimistic that, once scheduled for the floor, H.R. 5 will move forward.

This Week’s Hearings:

  • Tuesday, April 14: The House Appropriations Subcommittee on Labor-HHS-Education will host a hearing to discuss early childhood education programs in the FY 2016 Budget.
  • Tuesday, April 14: The Senate HELP Committee will hold a mark-up to consider the following legislation/nominations: S. ____   Every Child Achieves Act of 2015; S. ____ WIOA Technical Amendments Act; Ericka Miller to be Assistant Secretary for Postsecondary Education, Department of Education; and Michael Yudin to be Assistant Secretary for Special Education and Rehabilitative Services, Department of Education.
  • Thursday, April 16: The Senate Appropriations Subcommittee on Labor-HHS-Education will hold a hearing on the FY 2016 Department of Education budget. The hearing will feature Secretary of Education Arne Duncan.

Executive Branch Activity

WIOA Notice of Proposed Rulemaking to be Released on Thursday

On Thursday, April 16, the Departments of Labor and Education will release a joint Notice of Proposed Rulemaking (NPRM) related to implementation of the Workforce Innovation and Opportunity Act (WIOA). The proposed rule will introduce new regulatory proposals and key questions for stakeholders to consider. Additionally, separate rulemakings will be published to implement specific requirements of the Act that fall under each Department’s purview. Individuals or organizations that wish to comment on the proposed rules will have until June 15, 2015 (60 days) to do so. The pre-released NPRMs relevant to institutions of higher education include the following:

  • The Unified and combined state plans, performance accountability, and the one-stop system is the joint NPRM between the Department of Labor (DOL) and the Department of Education (ED). This NPRM seeks to propose regulations to lay the foundation, coordination, and collaboration processes for implementing the vision and goals of WIOA. More specifically, the proposed regulations (1) focus on procedural requirements on how to submit a State Plan to the DOL; (2) offers guidance for the interpretative rules; and (3) outlines the information to be collected and the process by which the Departments intend to collect the data.
  • The Title II Adult Education and Family Literacy Activities (AEFLA) NPRM from the Department of Education proposes updates to regulations that establish procedures for determining the suitability of tests used for measuring State performance on accountability measures under AEFLA as well as removes specific provisions in the Vocational and Adult Education code of federal regulations that are no longer applicable to the Federal adult education programs. Furthermore, the proposed rule offers an opportunity for stakeholders to comment on the newly proposed processes and requirements for States to award grants or contracts to local providers as well as the suggested definitions of what constitutes an adult education and literacy activity or program.
  • The Miscellaneous program changes NPRM from the Department of Education proposes to amend several regulations governing a number of programs administered by the Rehabilitation Services Administration (RSA) to implement changes to the Rehabilitation Act of 1973, which governs services provided to individuals with disabilities. Additionally, the NPRM proposes to implement changes to the Rehabilitation Act of 1973 previously proposed by the Workforce Investment Act (WIA) that had not been implemented to otherwise update, clarify and improve the RSA’s current regulations.
  • The State Vocation Rehabilitation Services program, state-supported Employment Service programs, and limitations on the use of subminimum wage NPRM from the Department of Education proposes to amend the regulations governing the State Vocational Rehabilitation Services program and the State Supported Employment Services program. In addition, the NPRM proposes to issue new regulations regarding limitations on the use of subminimum wages that were added by WIOA.

Over the past week, both departments have announced several workforce-related grant opportunities, including YouthBuild, Health Profession Opportunity Grants, and round five of the Workforce Data Quality Initiative grants, which reflect changes required by WIOA. We expect additional opportunities to roll out this spring as part of the Administration’s implementation process.

EPA Enters Next Phase on WOTUS; House to Review US Pledge to UN on Climate Change and U.S. Offshore Energy Plan; Senate To Review Land and Water Conservation Fund

Posted in Environment and Natural Resources

Regulatory Activity

Waters of the U.S. (WOTUS)

Following the regulatory process, on Friday, April 3, the Environmental Protection Agency (EPA) sent its proposed rule concerning the “Definition of the Waters of the U.S” to the Office of Management and Budget (OMB) for interagency review.  At that time, EPA also released a statement about the proposed rule.  Of interest to cities and counties, in its statement, EPA noted that for municipal separate storm sewer systems, the agency does not intend to change how those waters are treated and “has considered ways to address this concern.”  EPA also noted that in response to municipal comments that it will “continue to encourage the use of creative solutions like green infrastructure and low-impact development.”  EPA’s statement did not address how it would define terms such as “ditches, “other waters,” “significant nexus” and “tributaries,” only that it is still working to clarify those definitions.  There has been no information provided as to how long OMB is expected to take to conduct its assessment, however, EPA has reiterated that it is still committed to a release date for its final rule for “spring 2015.”

Clean Power Plan Update

EPA plans to propose its federal plan for meeting Clean Power Plan goals for public review and comment by “Summer 2015.”At that time EPA is also expected to release the final rules for its “Clean Power Plan for Existing Power Plants in States, Indian Country and U.S. Territories” and its “Carbon Pollution Standards for New, Modified and Reconstructed Power Plants.”  EPA has targeted for “Summer 2016” to issue provide due date for states to submit compliance plans to the agency – the agency has stated that these can be “complete plans or initial plans with requests for 1- or 2-year extensions.”  At that time, EPA will provide a finalized federal plan for meeting Clean Power Plan goals for areas that do not submit plans.”  The anticipated beginning of the compliance period is “Summer 2020.”

Wind

On Wednesday, April 15, the Department of Energy will host a webninar addressing issues with sitting windmills and radar. Click here to register.

Legislative Activity

UN Climate Change

On Monday, April 15, the House Science, Space and Technology Committee will hold a hearing on President Obama’s pledge to the UN on climate change. Jake Schmidt, Director of the International Program of the Natural Resources Defense Council, will testify.

Land and Water Conservation Fund

On Wednesday, April 22 the Senate Energy and Natural Resources Committee will hold a hearing on the reauthorization of the Land and Water Conservation Fund (LWCF). The LWCF is used to make federal land acquisitions in order to protect public lands to provide for outdoor recreational opportunities.

Use of Natural Resources

It will be an active week for the House Natural Resources Committee. On Monday, April 13, the Subcommittee on Water, Power, and Oceans will hold an oversight hearing titled, “Federal Water Grabs.” On Wednesday, April 15, the Subcommittee on Federal Lands plans to hold an oversight hearing on federal land acquisition. Also on the same day, the Subcommittee on Energy and Mineral Resources will hold a hearing  to examine the Administration’s Offshore Energy Plan.

Power Plants

On Tuesday, April 14, the House Energy and Commerce Committee, Subcommittee on Energy and Power will hold a hearing to examine EPA’s Proposed 111(d) Rule for Existing Power Plants, and the proposed “Ratepayer Protection Act.” Janet McCabe, EPA’s Acting Assistant Administrator Office of Air and Radiation, will testify.

Toxic Substances

On Wednesday, April 15, the House Energy and Commerce Committee, Subcommittee on Environment and the Economy will hold a hearing to examine the TSCA Modernization Act of 2015.

Senate Banking Committee Markup Not Yet Scheduled; House to Vote on Multiple Financial Services Bills

Posted in Financial Services

Legislative Activity

Senate Banking Committee Markup Not Yet Scheduled

This week, the Senate Banking Committee was expected to hold a markup regarding proposals to provide regulatory relief to small banks. However, the markup has not yet been scheduled, as Senate Banking Committee Chairman Richard Shelby (R-AL) has not agreed to limit the upcoming markup to bills aimed at providing regulatory relief for community and regional banks – despite concerns expressed by some Democrats about considering legislation that would amend or repeal portions of the Dodd-Frank Wall Street Reform and Consumer Protection Act. As we have previously highlighted, achieving regulatory relief for community and regional banks will not necessarily be an easy task.

House to Vote on Multiple Financial Services Bills

As lawmakers return to Washington, the House is slated to vote on several bills “focused on stemming the growing avalanche of Washington red tape and regulatory overreach that harms consumers and taxpayers, reduces their choices and makes it harder for them to achieve financial independence.”  The bills, which House Majority Leader Kevin McCarthy (R-CA) says will “promote a healthier economy, preserve consumer choice, and help our fellow Americans achieve the dream of financial independence,” include:

  • H.R. 299, Capital Access for Small Community Financial Institutions Act of 2015;
  • H.R. 601, Eliminate Privacy Notice Confusion Act;
  • H.R. 1195, Bureau of Consumer Financial Protection Advisory Boards Act;
  • H.R. 1259, Helping Expand Lending Practices in Rural Communities Act;
  • H.R. 1265, Bureau Advisory Commission Transparency Act;
  • H.R. 1367, Applying the Expedited Funds Availability Act to American Samoa and the Northern Mariana Islands;
  • H.R. 1480, SAFE Act Confidentiality and Privilege Enhancement Act;
  • H.R. 650, Preserving Access to Manufactured Housing Act of 2015; and
  • H.R. 685, Mortgage Choice Act of 2015

This Week’s Hearings:

  • Tuesday, April 14: The House Agriculture Subcommittee on Commodity Exchanges, Energy, and Credit will hold a hearing titled “Reauthorizing the CFTC Commissioners’ Perspectives.”
  • Wednesday, April 15: The House Financial Services Subcommittee on Monetary Policy and Trade, together with the House Oversight and Government Reform Subcommittee on Health Care, Benefits, and Administration, will hold a hearing titled “Oversight of Efforts to Reform the Export-Import Bank of the United States.”
  • Wednesday, April 15: The House Financial Services Committee on Financial Institutions and Consumer Credit will hold a hearing titled “Examining Regulatory Burdens on Non-Depository Institutions.”
  • Thursday, April 16: The House Financial Services Subcommittee on Housing and Insurance will hold a hearing titled “The Future of Housing in America: Increasing Private Sector Participation in Affordable Housing.”
  • Thursday, April 16: The Senate Banking Committee will hold a hearing titled “Regulatory Burdens to Obtaining Mortgage Credit.”

CMS Proposes Extending Mental Health Parity to Medicaid and CHIP; Medicare Advantage Rates Bumped Up

Posted in Health Care

Legislative Activity

With both chambers returning from recess this week, attention is focused on Senate consideration of the House-passed bill to permanently repeal Medicare’s physician payment system. While the last “doc fix” expired March 31, the Centers for Medicare and Medicaid Services (CMS) indicated it would hold claims for two weeks to allow Congress to return from the district work period and resume consideration of the legislation. The Senate has until Wednesday to take action on the bill to avoid steep cuts to physicians’ reimbursement rates, though an additional short-term patch may be utilized in order to consider Senate amendments to the House-passed legislative package.

While there is concern that changing any of the House language could slow down and undermine the viability of the legislation, there are key modifications that would bolster support in the Senate. Some Democrats are advocating for a four-year funding extension for the Children’s Health Insurance Program (CHIP), as opposed to the two-year extension included in the House-passed bill, and some Republicans are seeking out ways to fully offset the entire cost of the legislation.

This Week’s Hearings:

  • Tuesday, April 14: The House Committee on Education and the Workforce Subcommittee on Health, Employment, Labor, and Pensions will hold a hearing titled “Five Years of Broken Promises: How the President’s Health Care Law is Affecting America’s Workplaces.”
  • Tuesday, April 14: The House Committee on Appropriations Subcommittee on Defense will hold a hearing titled “Defense Health Program Budget.”
  • Tuesday, April 14: The House Committee on Ways and Means Subcommittee on Health will hold a hearing on the individual and employer mandates in the President’s health care law.
  • Tuesday, April 14: The Senate Committee on Finance will hold a hearing titled “Creating a More Efficient and Level Playing Field: Audit and Appeals Issues in Medicare.”
  • Wednesday, April 15: The House Committee on Appropriations Subcommittee on Labor, Health and Human Services, Education, and Related Agencies will hold a budget hearing on Ebola.
  • Wednesday, April 15: The House Committee on Veterans’ Affairs will hold a hearing titled “Denver VA Medical Center: Constructing a Way Forward.”
  • Wednesday, April 15: The House Committee on Foreign Affairs Subcommittee on Africa, Global Health, Global Human Rights, and International Organizations will hold a hearing titled “The Continuing Threat of Neglected Tropical Diseases.”
  • Thursday, April 16: The House Committee on Energy and Commerce Subcommittee on Health will hold a hearing titled “Medicare Post Acute Care Delivery and Options to Improve It.”

Regulatory Activity

CMS Proposes Extending Mental Health Parity to Medicaid and CHIP

On Monday, April 6, CMS released a proposed rule titled “Medicaid and Children’s Health Insurance Programs; Mental Health Parity and Equity Act of 2008; the Application of Mental Health Parity Requirements to Coverage Offered by Medicaid Managed Care Organizations, the Children’s Health Insurance Program (CHIP), and Alternative Benefit Plans.”

The Mental Health Parity and Addiction Equity Act of 2008 (MHPAEA) is a federal law that prohibits health insurance providers from imposing more restrictions on mental health and substance use disorder benefits as compared to medical and surgical benefits in the same classification of services (e.g., inpatient, emergency care). In 2013, the Departments of Health and Human Services (HHS), Labor, and Treasury issued final regulations which implemented the MHPAEA to health insurance and group health plans. The proposed rule would extend mental health parity to coverage offered by Medicaid Managed Care Organizations (MCOs), Medicaid Alternative Benefit Plans (ABPs) and CHIP. The mental health parity requirements would not apply, however, to Medicaid beneficiaries who are provided services on a fee for service (FFS) basis.

Comments on the proposed rule should be submitted on or before June 9, 2015.

Medicare Advantage Rates Bumped Up

On Monday, April 6, CMS announced that in 2016 it will increase Medicare Advantage (MA) payments by 1.25 percent, reversing a 0.9 percent decline proposed by the agency in February. During the past two years, CMS has similarly proposed a MA payment cut and ended up increasing the rate. Each year, the insurance industry has pushed back on the proposed decline, asserting that payment reductions would block access to care for seniors and other Medicare beneficiaries. CMS stated that 2016 MA payment rate increase is based on updated actuarial estimates, which stem from higher than expected spending on inpatient hospitalization and intermediary services, including therapy, rural health clinics, and federally qualified health centers.

CMS Actuary Forecasts Obstacles with SGR Repeal Bill

On Thursday, April 9, the CMS Office of the Actuary released a report on the “Estimated Financial Effects of the Medicare Access and CHIP Reauthorization Act of 2015 (H.R. 2).” In addition to reauthorizing CHIP and other Medicare reforms, H.R. 2 would replace the Sustainable Growth Rate (SGR) with a new value-based payment system.

The report cautions that although the new payment system would avoid the significant short-term problems raised by SGR, there would be “important long-range concerns that almost certainly need to be addressed by future legislation.” Specifically, the report states that physicians would experience a significant payment reduction in 2025 when the proposed additional updates and a 5 percent annual bonus would be scheduled to expire. Additionally, the report calls out H.R. 2 for failing to consider underlying economic conditions, which would make physician payments inadequate during years with higher inflation. The report predicts that under the new payment system, the rates would be lower than scheduled under the current SGR formula by 2048, and “would continue to worsen thereafter.” If these concerns are not addressed by future legislation, the report predicts that “access to, and quality of, physicians’ services would deteriorate over time.”

Robert Wah, President of the American Medical Association, spoke out against the report, calling its argument “illogical, flawed, and dangerous for patient access to high quality health care.” Specifically, he challenged the report’s assumption that payment rates would rise in the future under SGR.

CMS Shortens Meaningful Use Reporting Period

On Friday, April 10, CMS released a proposed rule titled “Medicare and Medicaid Programs; Electronic Health Record Incentive Program – Modifications to Meaningful Use in 2015 through 2017,” which would modify the Medicare and Medicaid Electronic Health Record (EHR) Incentive Program. The rule proposes streamlining the Meaningful Use (MU) reporting requirements, and aligning the requirements for Stages 1 and 2 with the approach for Stage 3 that CMS released last month.

Starting in 2015, the rule proposes moving both physicians and hospitals to an EHR reporting period based on the calendar year with a continuous 90-day reporting period, rather than in set quarters. Additionally, the rule proposes modifying the Stage 2 patient engagement objective by reducing the number of patients who must access their records electronically from five percent to one person. This would demonstrate that the system is “fully enabled” without penalizing providers for external factors which are beyond their control.

Comments on the proposed rule should be received by 60 days after the date of publication in the Federal Register.

Appropriations Season About to Begin; Federal Appeals Court Considers Appeals to Immigration Policies

Posted in Homeland Security

Legislative Activity

Appropriations Season About to Begin

Congress returns from a two-week recess this week, with work on twelve appropriations bills set to begin very soon. Last week, House Appropriations Chairman Harold Rogers (R-KY) announced vice chairmen for each of the panel’s subcommittees. Rep. Rodney Frelinghuysen (R-NJ), chair of the Defense Subcommittee, will also serve as vice chair of the Homeland Security Subcommittee.

This Week’s Hearings:

  • Tuesday, April 14: The Senate Homeland Security and Governmental Affairs Committee will hold a hearing titled “Reducing Unnecessary Duplication in Federal Programs: Billions More Could Be Saved.”
  • Tuesday, April 14: The House Judiciary Committee will hold an oversight hearing with Sarah R. Saldaña, Director of U.S. Immigration and Customs Enforcement.
  • Wednesday, April 15: The House Judiciary Subcommittee on Crime, Terrorism, Homeland Security and Investigations will hold a hearing titled “Analyzing Misconduct in Federal Law Enforcement.”
  • Wednesday, April 15: The House Appropriations Subcommittee on Homeland Security will hold a hearing on FY 2016 appropriations with Sarah R. Saldaña, Director of U.S. Immigration and Customs Enforcement.
  • Wednesday, April 22: The House Homeland Security Subcommittee on Oversight and Management Efficiency will hold a hearing titled “Acquisition Oversight: How Effectively Is DHS [Department of Homeland Security] Safeguarding Taxpayer Dollars?”
  • Wednesday, April 22: The House Homeland Security Subcommittee on Emergency Preparedness, Response and Communications will hold a hearing titled “Strategic Perspectives on the Bioterrorism Threat.”

Executive Branch Activity

Federal Appeals Court Considers Appeals to Immigration Policies

This week, the United States Court of Appeals for the Fifth Circuit scheduled two hours of oral arguments to consider a lower court’s injunction blocking implementation of the President’s recently proposed actions on immigration. U.S. District Judge Andrew Hanen originally issued the injunction in February in a case brought by 26 states against the President’s proposal. The oral arguments, which will take place later this week on April 17, will focus on the merits of Judge Hanen’s original injunction staying implementation of the President’s November 2014 announcement while appeal of the decision works its way through the courts. Experts note that holding a public session in consideration of a stay is extremely rare.

The Fifth Circuit also granted the federal government’s motion for expedited appeal; the briefing schedule in that case is set to run through mid-May, with oral arguments possible in late May or in June.

Last week, a panel of Fifth Circuit Court judges sided with the federal government in a case brought by Immigration and Customs Enforcement agents and the State of Mississippi against the President’s 2012 Deferred Action for Childhood Arrivals (DACA) program. The panel ruled that the parties did not have legal standing to challenge the policy because the evidence of harm they provided was too speculative. While the decision is technically binding on the case brought by 26 states, that panel could decide that the facts in the latter case can be distinguished and choose not to follow the precedent set by the earlier case.

Congress Returns to Washington, Focuses on Iran, Russia, Yemen and Possibly TPA; President Obama to Host Iraqi and Italian Prime Ministers This Week in Washington

Posted in International

Iran

With the Obama Administration facing months of international negotiations with Tehran for a comprehensive deal on Iran’s nuclear program, it also worked this week to ensure congressional actions do not compromise the diplomatic effort. Bipartisan lawmakers still believe Congress should have an up-or-down vote on any final accord reached with Iran. The Senate Foreign Relations Committee is scheduled to hold a business meeting to discuss S. 615, The Iran Nuclear Agreement Review Act of 2015, on 14 April.

Russia/Ukraine Crisis

On 14 April, the House Foreign Affairs Committee (HFAC) is scheduled to hold a hearing to examine Russia’s propaganda machine. The next day, the Committee’s Subcommittee on Global Human Rights will hold a markup of H. Res. 50, which calls for Russia to release Ukrainian fighter pilot Nadiya Savchenko.

In Kyiv last week, Senator Rob Portman (R-Ohio) met with Ukraine President Petro Poroshenko and Prime Minister Yatsenyuk. At a Thursday press briefing, the Senator said that he would personally fight to secure military assistance for Ukraine. The Senator added:

“economic sanctions will stay unless Russia pulls back and respects the sovereign borders of Ukraine. Anything short of that will not be tolerated. We have to remember that sanctions have been imposed not only in response to the Russian aggression in eastern Ukraine, but after the annexation of Crimea.”

Yemen

On 14 April, the HFAC Subcommittee on the Middle East is scheduled to hold a hearing on the crisis in Yemen and the Iranian-backed Houthis.

Trade Updates

Secretary of Commerce Penny Pritzker said last Thursday the Administration is anxiously waiting to examine the proposed bill to renew Trade Promotion Authority (TPA) upon its expected release this week. Later in the day, aides to both Senate Finance Committee Chairman Orrin Hatch (R-Utah) and Ranking Member Ron Wyden (D-Oregon) emphasized that negotiations were ongoing and a deal had not yet been reached. While many speculated the bill would be introduced on Monday, sources are now indicating the bill may be released “later” this week. A Committee markup is tentatively slated for 21 April. Meanwhile, sources are reporting the House will not introduce a TPA bill until after the Senate markup to reflect any changes to the introduced Senate bill and to streamline consideration of the measure in the House. Sources also report the Senate TPA bill may include Generalized System of Preferences (GSP) renewal, the African Growth and Opportunity Act (AGOA) renewal, and customs reauthorization.

The rule of origin for autos is emerging as a challenge for concluding negotiations in the parallel U.S.-Japan talks; and for the ongoing Trans-Pacific Partnership (TPP) negotiations. A U.S. trade official reportedly said intellectual property (IP) rules and outstanding issues with Canada and Malaysia remain challenges for concluding the TPP deal. The State-Owned Enterprises (SOE) chapter is reportedly largely complete, with parties still negotiating the annex that will include specific SOEs that will be exempted from the general disciplines. TPP negotiators are slated to meet 23-26 April in a location yet to be determined in the United States.

Last week, the Office of the U.S. Trade Representative announced the ninth round of the Transatlantic Trade and Investment Partnership (TTIP) will take place in New York City on 20-24 April.

Ex-Im Bank

On 15 April, the House Financial Services Monetary Policy and Trade Subcommittee and the House Oversight & Government Reform Committee will hold a joint hearing on the U.S. Export-Import (Ex-Im) Bank.  The Ex-Im Bank’s charter is up for renewal and expires on 30 June.

Oil Exports

On 14 April, the House Foreign Affairs Subcommittee on Trade will hold a hearing to examine whether the U.S. ban on exporting oil is helpful or harmful.

U.S.-CARICOM Summit

Last Thursday in Jamaica, President Barack Obama met with Caribbean Community (CARICOM) leaders to reaffirm the U.S. partnership with Caribbean countries to advance economic development, security, and good governance. The White House released a fact sheet on deepening energy cooperation.

Summit of the Americas/Cuba

President Obama attended the biannual Summit of the Americas in Panama last Friday. The Presidents of the United States and Cuba were both be in attendance for the first time and met Saturday on the margins of the Summit. Secretary of State John Kerry and Cuban Foreign Minister Bruno Rodriguez held talks at on Thursday night in Panama. One rapprochement topic of discussion is whether the Obama Administration will remove Cuba from a U.S. list of countries that it says sponsor terrorism.

Syria/Iraq Crises

In advance of Iraqi Prime Minister Haider al-Abadi’s visit to Washington this week, Vice President Joe Biden said last Thursday that ISIL’s advancement in Iraq has been halted. He also said the various political divisions of Iraq unified to combat ISIL.

123 Agreement

Last Friday, President Barack Obama approved the renewal of a so-called 123 agreement with China, which would allow the U.S. to continue to export civilian nuclear equipment and products to that country. Unless Congress offers a joint resolution disapproving the agreement, the decision will go into affect 90 days after it is published in the Federal Register. The existing agreement with China is set to expire on 30 December.

Ebola

Last Wednesday, President Obama met with his international health and national security teams to discuss what more can be done to bring the number of Ebola cases in West Africa to zero. The President’s advisors updated him on the situation in the region and briefed him on measures currently underway to end the epidemic in Sierra Leone and Guinea.

Nominations

Last week, President Obama announced his intention to nominate the following individuals: William Heidt to be U.S. Ambassador to Cambodia; David Robinson to be Assistant Secretary of State for Conflict and Stabilization Operations and Coordinator for Reconstruction and Stabilization; and Gabriel Camarillo to be Assistant Secretary of Defense for the Air Force for Manpower and Reserve Affairs.

Congressional Retirement

Last week, Representative Lois Capps (D-California) announced she will retire when her term ends in 2016. She currently serves on the House Energy & Commerce Committee. Her district remains likely to favor a Democrat again in 2016.

Looking Ahead

Washington will likely focus on the following upcoming matters:

  • 14 April: President Obama to host Iraqi Prime Minister Haider al-Abadi
  • 17 April: President Obama to host Italian Prime Minister Matteo Renzi
  • 17-19 April: 2015 Spring Meetings of the World Bank Group and the IMF in Washington
  • 20-24 April: TTIP negotiations in New York, New York
  • 7-8 June: G-7 Summit in Schloss Elmau, Germany
  • 30 June: U.S. Export-Import Bank charter expires
  • 15 September: 70th Session of the U.N. General Assembly (UNGA) opens in New York City
  • 24 September: Pope Francis to address Congress and meet with President Obama
  • 28 September: General debate of the UNGA begins