A massive bipartisan bill is getting pushback from House conservatives and influential right-wing groups who are livid over nearly $10 billion in new spending on medical research.
Several Republicans are upset the 21st Century Cures Act, which hastens development of new drugs and devices, avoids spending caps. The bill gives $8.75 billion to the National Institutes of Health over five years and $550 million to the Food and Drug Administration over the same period.
“The funding stream is a problem,” said Rep. David Brat, R-Va., during a hearing of the House Rules Committee on Wednesday. Brat offered an amendment to the bill that would change the funding from mandatory to discretionary.
The committee approved the amendment and it will now be considered by the House along with the full bill.
The Budget Control Act set up certain discretionary spending caps for each federal agency. Congress could boost spending for those agencies as long as it stayed inside the cap. But the House Energy and Commerce Committee largely avoided the spending caps by making the funding mandatory. That is what lawmakers have a problem with.
“What drives the debt is mandatory spending,” said Rep. Tom Cole, R-Okla., during the hearing.
Cole was also worried about what happens when the extra funding for the agencies runs out after five years. He gave an example of five years of extra funding for community health centers in Obamacare, but the funding was reauthorized after it lapsed.
Rep. Diana Degette, D-Colo., one of the leaders of the bill, shot back that “if in five years [we] want to not reauthorize it then we won’t.”
“I don’t believe we will stop doing this in five years,” Cole responded.
“I know what a $2 billion hole looks like in a $30 billion agency focused on important stuff,” he said, referring to NIH’s total budget.
Over time, the bill would generate billions in Medicaid savings from certain offsets, said Rep. Fred Upton, R-Mich., chairman of the House Energy and Commerce Committee and a major advocate of the bill.
The Congressional Budget Office has noted that several of the bill’s entitlement reforms to Medicare would reduce the deficit by more than $500 million in the first decade and an additional $7 billion in the second decade.
One of the reforms includes limiting Medicare reimbursement rates for medical equipment and prosthetics to ensure the agency doesn’t overpay for products.
The funding for NIH has decreased from the bill that was voted unanimously out of committee in May. The committee originally proposed giving $10 billion over five years.
It also would change the method for paying for Medicare Part B drugs by setting the payment to a drug’s average sale price plus 6 percent. That would ensure that the program doesn’t overpay for prescription drugs, as manufacturer sticker prices sometimes are well above the average price.
But those reforms have done little to silence two conservative groups pushing for lawmakers to vote against the bill.
“It blows through sequestration caps in spirit, if not by the letter of the law, with new mandatory spending,” Doug Sachtleben, spokesman for Club for Growth, told the Washington Examiner Wednesday.
The right-leaning think tank was also concerned about using sales of crude oil from the Strategic Petroleum Reserve to fund part of the bill. Sachtleben called the plan a “new low for budgetary gamesmanship.”
The bill would sell off nearly 8 million barrels of oil in the reserve of nearly 700 million barrels.
Not to be outdone, Heritage Action also called on lawmakers to vote against it, citing concerns about mandatory spending and how it would be paid for.
“It is impossible to ignore woefully insufficient offsets that are meant to mask the very real and immediate spending increases,” according to the group, the political advocacy arm of the right-leaning think tank Heritage Foundation.
The House Energy and Commerce Committee hit back hard at Heritage’s criticism.
The group takes a “surprisingly short-sighted view of our plan to achieve meaningful reform in a fiscally responsible way,” said committee spokeswoman Noelle Clemente.
She added that conservative voices played a large part in the development of the bill.
