Washington Update

President Obama Releases His Fiscal Year 2014 Budget

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On April 10, 2013, President Barack Obama released his budget plan for the Fiscal Year (FY) 2014, which begins October, 1, 2013. The Administration’s budget request is legally due on Capitol Hill the first Monday in February, which would have been February 4, 2013. However, the budget was released two months later because of the continuous battle over the terms of a deal needed to avert a combination of tax increases and across-the-board cuts, or sequester. Overall, the President proposes a $3.77 trillion budget for fiscal year 2014, including proposals to highlight the importance of higher education and health care. ADEA has provided a more detailed summary of the budget at this link.

Specifically, President Obama’s proposal includes $563 billion in additional tax revenue and $78 billion in new cigarette taxes, both over 10 years; and $1.8 billion in spending cuts, also over ten years. Among the many proposals, the President’s recommendations include:

  • National Institutes of Health: The President requests an increase of more than $450 million from last year, to $31.3 billion.
  • National Institute of Dental and Craniofacial Research: The President’s request for the National Institute of Dental and Craniofacial Research (“NIDCR”) for FY 2014 is $411,515,000; it represents an increase of $1.6 million over the FY 2012 level.
  • Department of Health and Human Services: The President’s budget proposal provides $80.1 billion in discretionary funding for the Department of Health and Human Services (“HHS”), $3.9 billion above the 2012 enacted level.
  • Centers for Disease Control and Prevention, Division of Oral Health: The President proposes a small increase ($43,000) in the oral health budget within the Centers for Disease Control and Prevention (CDC). Therefore, under the President’s budget for FY 2014, the Division of Oral Health is proposed to receive $59,921,000.
  • Community Health Centers: The budget requests $3.8 billion for community health centers that will serve 23 million users and allow for 40 new centers.
  • Title VII Programs: The President’s budget requests $32,392,000 for Oral Health Training Programs in FY 2014. This is $527,000 below the FY 2013 amount and the same as was appropriated in FY 2012. The President’s request does not include an amount for funding the new oral health provider demonstration projects that were authorized in the Affordable Care Act.
  • Ryan White Dental Reimbursement Program—Part F: The President’s budget request holds this program to the FY 2012 level at $13,485,000.
  • Federal Student Aid: The President is requesting $71.2 billion in discretionary funding for the U.S. Department of Education, an increase of $3.1 billion or 4.5% over the FY 2013 pre-sequester level. The 2014 request proposes to change the interest rate structure for new student and parent loans to market-based rates that better reflect current economic conditions.
  • Investment in the Science, Technology, Engineering, and Mathematics (STEM) Program: The President proposes a reorganization of STEM, designed to increase the impact of Federal investments in four areas: K-12 instruction, undergraduate education, graduate fellowships, and education activities that typically take place outside the classroom, all with a focus on increasing participation and opportunities for individuals from groups historically underrepresented in these fields.
  • Provider Cuts: Beginning in 2014, the President’s proposal would cut “add-on” payments to teaching hospitals for graduate medical education by 10 percent. In the budget document, the Department of Health and Human Services cites a Medicare Payment Advisory Commission (MedPAC) finding that these additional payments “significantly exceed the actual added patient care costs these hospitals incur.”

There are three budget proposals that are the starting point for discussions: the President’s budget; the House of Representatives’ budget, “The Path to Prosperity” introduced by Rep. Paul Ryan (R-WI); and the Senate’s budget, "Foundation for Growth, Restoring the Promise of American Opportunity” introduced by Sen. Patty Murray (D-WA). It should be noted that the President’s budget will not pass Congress; nevertheless, the document delineates the Administration’s priorities. In essence, the document could become the floor for negotiations for FY 2014 appropriations.

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