Congressional Leaders Name Legislators to Debt Reduction Panel; Decisions Could Impact Medicaid

by Rebecca Farley on August 11, 2011

Democratic and Republican Congressional leaders this week announced their 12 picks for the Joint Select Committee on Deficit Reduction, a panel tasked with finding over $1 trillion in government spending reductions or revenue increases to offset the amount of the new debt ceiling increase enacted this month.

The Joint Select Committee (also known as the “supercommittee”) is to be made up of 6 Democrats and 6 Republicans, evenly split between the House and the Senate. The Democratic members will include Senators Max Baucus (D-MT), John Kerry (D-MA), and Patty Murray (D-WA), along with Representatives James Clyburn, Xavier Becerra, and Chris Van Hollen. The Senate Republicans will include Patrick Toomey (R-PA), Jon Kyl (R-AZ), and Rob Portman (R-OH). On the House side, the Republican appointees will be Representatives Dave Camp, Jeb Hensarling, and Fred Upton (R-MI).

In the wake of the announcements, political analysts could not predict with certainty how the makeup of the panel might influence its ability to reach a compromise. The Joint Select Committee may recommend any type of deficit-reduction measure it chooses, including cuts to Medicaid and other health programs. Some observers have expressed hope that the bipartisan panel can reach a breakthrough compromise on overhauling the tax code and reforming entitlement programs such as Medicaid, Medicare, and Social Security – but it is far from clear whether the group will be able to agree on such sweeping changes.

The Joint Select Committee must have its first meeting by Sept. 16, 2011 and must approve a plan with at least $1.5 trillion in savings by Nov. 23. The plan would then be fast-tracked through Congress with no amendments permitted, with a final vote occurring by Dec. 23. Should Congress or the Committee fail to meet these deadlines or the target spending reductions, automatic spending cuts (also known as “sequestration”) would be triggered, beginning after a period of 12 months, in January 2013. The spending cuts would be spread equally between defense and non-defense programs and must equate to a total of $1.2 trillion, including the amount (if any) of the savings achieved under the Joint Select Committee’s plan.

According to a recent report from the Center on Budget and Policy Priorities, should automatics cuts be triggered, they would result in about a 9 percent annual cut in non-defense programs, along with roughly a 9 percent cut in defense programs. Although Medicaid would be protected from these automatic cuts and Medicare would be subject to a maximum of 2% reductions in provider cuts only, many other health and human services programs could see reductions, including some programs authorized and funded in the Affordable Care Act. For more information on how the Joint Select Committee’s negotiations could affect Medicaid and Medicare, see this FAQ from Kaiser Health News.

The National Council will continue to closely follow the work of the Joint Select Committee as it begins negotiations. Stay tuned to MentalHealthcareReform.org for the most recent news and information.

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