Pressure is mounting for Washington to find a way to avoid the automatic spending reductions set to begin March 1, with President聽 Congress to stop the 鈥渕eat-cleaver approach鈥 that he says will undermine U.S. military strength and 鈥渆viscerate job creating investments in education and energy and medical research.鈥
But while both Democrats and Republicans say they don鈥檛 want the billions of dollars in cuts to kick in, there鈥檚 no agreement on how to stop them.
The nation鈥檚 two major health entitlement programs, Medicare and Medicaid, are protected from the bulk of the cuts which will hit a wide swath of federal discretionary spending. Other government programs, including health-related programs, such as medical research, mental health treatment and approvals for new drugs, , according to the Congressional Budget Office.
鈥淭hese cuts are not smart. They are not fair. They will hurt our economy,鈥 Obama said Tuesday, standing before a group of emergency responders gathered at the White House. House Speaker聽 Obama鈥檚 鈥渃ampaign-style event鈥 did little to resolve the dispute. 鈥淭o keep these first responders on the job, what other spending is the president willing to cut?鈥 Boehner asked in a statement.
Democrats are demanding hearings on the impact of the reductions, and representatives of the medical research community, as well as patient advocates and other health experts, say Congress must find a way to stop the automatic spending cuts.
鈥淭hese are programs that are not bloated right now,鈥 said Maura Calsyn, associate director of health policy at the left-leaning Center for American Progress. 鈥淭hey need every last dime to continue their important work in public health and safety. There is a right way and a wrong way to have cost containment, and across-the-board cuts are simply not the right way to do it. It does nothing to address waste or inefficiencies in the system, nor does it reform the system at all.鈥
Obama and Democrats want more revenue as part of any deal to stop the automatic cuts, known as 鈥渟equestration鈥 but Republicans, who accepted tax increases in the Jan. 1 fiscal cliff deal, oppose that. The Senate is expected to vote next week on a $110 billion Democratic plan that includes both new revenues and spending adjustments to postpone the sequester for the rest of the calendar year. Senate Minority Leader Mitch McConnell, R-Ky., said he expects that Republicans will offer their own alternative. The GOP-controlled House of Representatives passed two measures last year that would sidestep the sequester by trimming federal spending in other areas.
The sequester鈥檚 $85.3 billion in cuts for fiscal 2013 are part of a larger package of $1.2 trillion in cuts scheduled to occur over the next decade. The upcoming cuts are split evenly between defense and domestic programs.
While the reductions are scheduled to begin March 1 unless Congress intervenes, their full impact likely won鈥檛 be felt for weeks. Some lawmakers have suggested that instead of worrying about the sequester鈥檚 impact, they should focus on March 27 鈥 when the current law funding much of the federal government鈥檚 operations expires.
Trims In Health Programs
The automatic cuts would not affect Medicaid, the joint federal-state health program for the poor. Medicare spending would be cut by 2 percent through reductions in payments to hospitals, physicians and other care providers.
But several other health care programs would be hit, according to a聽聽of the sequestration鈥檚 effects:
鈥揟he National Institutes of Health would be forced to 鈥渄elay or halt vital scientific projects and make hundreds of fewer research awards,鈥 which means that 鈥渟everal thousand personnel could lose their jobs,鈥 the White House said. Twelve thousand scientists and students would be impacted because the National Science Foundation would offer 1,000 fewer research grants and awards.
鈥揟he Food and Drug Administration would be able to do fewer drug approvals and conduct 2,100 fewer inspections at domestic and foreign facilities that manufacture food products.
鈥揅uts to the Mental Health Block Grant program would mean that 373,000 adults and children would not receive mental health services. 鈥淭his cut would likely lead to increased hospitalizations, involvement in the criminal justice system and homelessness for these individuals,鈥 according to the White House document.
鈥揅uts to the AIDS drug assistance program could result in 7,400 fewer patients having access to HIV medications, and the Centers for Disease Control and Prevention could conduct approximately 424,000 fewer HIV tests.
鈥揟he Indian Health Service and tribal hospitals and clinics would also be hit by sequestration, with 3,000 fewer inpatient admissions and 804,000 fewer outpatient visits, according to the White House analysis.
While there鈥檚 plenty of criticism from all sides of sequestration as a policy, it does focus the country on reducing its debt, said Joseph Antos, a health care expert at the American Enterprise Institute, a conservative think tank. 鈥淲e can鈥檛 continue on without doing something about Medicare spending and federal health spending in general. But as everyone agrees, a sequester is not a policy. It鈥檚 a haircut. And there are a lot smarter ways鈥 to reduce spending, he said.
Intensive Lobbying Campaign
The sequester threat, however, has led to an intensive lobbying campaign by industry and patient advocacy groups. While the cuts to Medicare are limited, hospitals and other medical providers who will be absorbing them argue that the latest reductions are especially difficult because they already sacrificed some of their federal funding in the 2010 health care law.
, the American Hospital Association noted that hospitals have contributed an average of 28,000 new jobs per month in 2012 and that hospitals employ almost 5.5 million people and support an additional 10 million jobs. 鈥淐ongress should not overlook the economic contribution of hospitals as it considers further deficit reduction proposals,鈥 association president and chief executive officer Rich Umbdenstock said in a statement.
More than 270 organizations, including Research!America, the Mayo Clinic and Yale School of Medicine,聽 earlier this month seeking changes. Among their concerns, they warned that sequestration 鈥渨ill negatively impact U.S. competitiveness just as other nations are aggressively boosting their investments in research and development.鈥
In addition, more than 300 Alzheimer鈥檚 researchers said in聽 to the Hill that the cuts would be devastating. 鈥淎 robust commitment to high-impact Alzheimer鈥檚 research is essential if we hope to stop this disease before it destroys the nation鈥檚 health and financial well-being,鈥 they wrote to congressional leaders.
The American Medical Association and other medical organizations are also fighting sequestration,聽 to take a 鈥渕ore targeted, rational approach that allows careful assessment of how to fulfill its long-term commitment to seniors, uniformed service members and their families, and public health and safety priorities.鈥
Even if Congress finds a way to stop the cuts, that鈥檚 no guarantee that Congress won鈥檛 trim agency budgets even more in the yearly appropriations process or as lawmakers seek a larger deal to reduce the deficit.
鈥淭he sequester is a better deal if 鈥 that鈥檚 the only thing that happens,鈥 Antos said. 鈥淚 think a pretty good bet is that we鈥檙e going to get a sequester 鈥 but on top of that we鈥檙e going to see additional cuts in Medicare.鈥 Medicaid, he and other analysts speculate, is likely to remain off the table.