The battle over the fiscal year 2010 federal budget began Wednesday, and both the House and Senate budget committees expect the long process will include healthcare as one of the focal points.
President Barack Obama delivered his initial budget draft to Congress in February, with a more expanded version due in April. His objectives include increasing efficiency and lowering healthcare costs, along with advancing education and energy – all of which he hopes to accomplish while lowering the federal deficit.
Those in favor of the budget say money must be spent up front to reap savings later. Those against argue that the deficit is already too great and cannot sustain any more undue burdens.
Senate Budget Committee Chairman Kent Conrad (D-N.D.) launched the debate Wednesday with the delivery of his version of the budget, called the Chairman's Mark.
"This budget really needs to be viewed in the context of the very difficult situation that we have inherited," Conrad said. "This administration and this Congress have been handed significant complications. It did take 224 years and 42 presidents to rack up $1 trillion of foreign-held debt, U.S. foreign-held debt. President Bush more than tripled that amount during his time in office."
Conrad called healthcare the 800-pound gorilla and said soaring health costs threaten American families, businesses and the fiscal structure of the country. "Total public and private healthcare spending is projected to rise to 37 percent of GDP by 2050 if we stay on the current trend line, and clearly we cannot," he said.
Conrad said the benefits of spending on healthcare would not show up for six years. He also defended the president's reserve fund to address Medicare physician payments.
Referring to temporary stop-gap funding for physician payments over the past few years, Conrad said Congress is already paying for a "doc fix." He argued it should be permanently resolved according to the president's plan. Without Congressional intervention, doctors would face a 21 percent pay cut next year.
A March 20 report by the Congressional Budget Office predicted the president's budget would produce $9.3 trillion worth of debt from 2010 to 2019.
Sen.Judd Gregg (R-N.H.) ranking member of the Senate Budget Committee, said the Democrats' plan would unfairly saddle America's children with massive debt, and that the president's plan will increase taxes and expand government. He also expressed concern that Democrats would try to stifle Republicans' chances for a fair debate.
"The use of reconciliation, which we know will be coming at us from the House through the conference process, is utterly inappropriate and does serious harm to the Senate process of open debate. To circumvent that process on such a significant policy reform does a terrible disservice to the American people," Gregg said.
House Budget Committee Chairman John Spratt (D-S.C.) defended the president's longterm budget plans. "Since we revisit the budget every year, we can continually take steps to correct its course," he said. "For our part, I tell you we have our eye on the second five years, and as we approach 2015 and 2016, we will be making corrections to see that the deficit stays on a downward trajectory. But those corrections can be made better when our economy has emerged from recession."
His counterpart, Ranking Member Paul Ryan (R-Wisc.) pleaded with the more conservative Blue Dog Democrats to help Republicans "stop the fiscal train wreck."
"We are not the kind of a nation that is going to be defeated by outside forces. But we are the kind of a nation that if we don't watch it we could defeat ourselves from within. That is exactly is what this budget proposes to do in my opinion," he said.
"We know both parties don't corner the market on virtue on fiscal conservatism. Yes, Republicans clearly made mistakes in that area. Let's accept that, and let's not make them worse. Let's not compound these problems – let's fix them," he added.
The president's budget calls for nearly $77 billion for the Department of Health and Human Services and includes funding to correct the Medicare physician payment structure, advance health IT and expand research of care comparative effectiveness. Congressional appropriations committees will be hammering out the fine details of the fiscal year 2010 budget, with a target date of Oct. 1.