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Monday, April 2, 2012

Overview of Health Care Changes in theFY2013 Budget Proposal Offered by House Budget Committee Chairman Ryan

Patricia A. Davis
Specialist in Health Care Financing

Alison Mitchell
Analyst in Health Care Financing

Bernadette Fernandez
Specialist in Health Care Financing

On March 20, 2012, House Budget Committee Chairman Paul Ryan released the Chairman’s mark of the FY2013 House budget resolution together with his report entitled “The Path to Prosperity: A Blueprint for American Renewal,” which outlines his budgetary objectives. On the same day, CBO issued an analysis of the long-term budgetary impact of Chairman Ryan’s budget proposal based on specifications provided by House Budget Committee staff. The House Budget Committee considered and amended the Chairman’s mark on March 21, 2012, and voted to report the budget resolution to the full House. H.Con.Res. 112 was introduced in the House March 23, 2012, and was accompanied by the committee report H.Rept. 112-421. H.Con.Res. 112 was agreed to by the House on March 29, 2012.

A budget resolution provides general budgetary parameters; however, it is not a law. Changes to programs that are assumed or suggested by the budget resolution would still need to be passed by separate legislation. Chairman Ryan’s budget proposal, as outlined in his report and in the CBO analysis, suggests short-term and long-term changes to federal health care programs including Medicare, Medicaid, and the health insurance exchanges established by the Patient Protection and Affordable Care Act as amended (ACA, P.L. 111-148, P.L. 111-152).

Within the 10-year budget window (FY2013-FY2022), the budget proposal assumes that certain ACA provisions would be repealed, including those that expand Medicaid coverage to the nonelderly with incomes up to 133% of the federal poverty level, and those provisions that establish health insurance exchanges. The proposal would also restructure Medicaid from an individual entitlement program to a block grant program. Beyond the 10-year budget window, beginning in 2023, the budget proposal assumes an increase in the age of eligibility for Medicare and the conversion of Medicare to a fixed federal contribution program.

This report summarizes the proposed changes to Medicare, Medicaid, and private health insurance as described in H.Con.Res. 112, the accompanying committee report, Chairman Ryan’s “Path to Prosperity” report, and the CBO analysis. Additionally, it briefly examines the potential impact of the proposed changes on health care spending and coverage.

Date of Report: March
29, 2012
Number of Pages:
Order Number: R424
Price: $29.95

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