President's 2014 Budget Proposal Released

The Obama Administration's proposed budget for 2014, which contains a mix of programmatic activities for the year as well as legislative priorities, was released on April 10. While many of the items contained in the budget are unlikely to come to fruition due to the divided Congress and president, it does provide a glimpse at administration priorities for next year. ACC Advocacy staff members are currently reviewing the proposal in more detail, but some of the key highlights for cardiology include: 

  • An assumption that Medicare payments to physicians will not be reduced by the mandated Sustainable Growth Rate (SGR) formula. This formula is scheduled to cut payments to physicians by 25 percent in 2014, but previous scheduled cuts have been overridden by short term Congressional action. 
  • A proposal to reduce so-called "indirect" payments for graduate medical education (GME) by 10 percent starting in 2014, at a savings of more than $10 billion over 10 years.
  • Increased funding for audits and investigations, noting a return on investment of these activities of 8 to 1 for taxpayers.
  • A proposal to require prior authorization of advanced imaging (CT, MR, nuclear). Although included in the budget, the implementation is not scored as a savings for Medicare. 
  • A proposal to limit the availability of the in-office ancillary services exception so that advanced imaging services (CT, MR, nuclear) could not be provided if ordered by a physician in that office. However, the budget indicates that the exception could still be available if certain undefined accountability standards are met.
  • A proposal to partially fund the Food and Drug Administration (FDA) by taking advantage of user fee programs authorized last year, previously existing programs for prescription drugs and medical devices, along with the new programs for biosimilars and generic drugs. Also $534 million in user fees aimed at decreasing use of tobacco products.
  • A total of $31 billion – a 1.5 percent increase from 2012 levels – for the National Institutes of Health (NIH).
  • Continued investment in implementation of health information technology and electronic information exchanges as funds from the American Recovery and Reinvestment Act begin to expire.
  • A proposed incentive to discourage the use of low cost-sharing Medigap plans, including a surcharge for participating in those plans. These have been criticized but are very popular among beneficiaries.  
  • A proposal to lower the target growth rate for the Independent Payment Advisory Board so that the board could take binding action even with lower cost growth in health care. Target growth rate would reduce to GDP plus 0.5 percent. The IPAB, a major feature of the ACA, has yet to be formed. 
  • A proposal to extend funding for a consensus-based entity (likely the National Quality Forum (NQF)) to focus on performance measures and quality improvement. Current government funding for NQF expires at the end of 2014.

More details will be included in The ACC Advocate and in the coming weeks and months, including ways to take action.  

Keywords: Cost Sharing, Social Responsibility, Drugs, Generic, Medical Informatics, Budgets, Consensus, Financial Management, Quality Improvement, Education, Medical, Graduate, United States Food and Drug Administration, American Recovery and Reinvestment Act, Prescription Drugs, Investments, National Institutes of Health (U.S.), Medicare

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