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AIDS Action Weekly Update

June 13, 1997

Welcome to AIDS Action Council's Weekly Washington Update, an on-line newsletter for Handsnet subscribers that reviews what is happening in Washington on AIDS policy issues each week. If you have any comments or questions, please feel free to contact us at the e-mail address listed below.

FASA Threatened

The Federal Acquisition Streamlining Act (FASA), a program by which state AIDS Drug Assistance Programs (ADAPs), public hospitals, and state and local health departments, can purchase computers, office equipment, and other items, as well as pharmaceuticals such as the expensive state-of-the-art HIV/AIDS treatments at up to a 40 percent discount is threatened by a coalition funded by the pharmaceutical industry and small businesses. FASA has yet to be implemented and it is expected that there will be an aggressive push by opponents to repeal this critical piece of legislation. AIDS Action and the National Association of Public Hospitals & Health Systems, are working together to ensure that states have access to this purchasing program which will alleviate some of the pressure on already overburdened state ADAPs that are having difficulty providing drugs to those who need them. Initially, FASA was to be implemented in August 1997 but an agreement included in the supplemental disaster relief bill recently passed by Congress established a moratorium on the implementation of FASA through December 1997.

Reconciliation Process In Full Swing

The budget process has kicked into high gear with markups of portions of the two budget-balancing reconciliation bills that are currently making their way through Congress. Eight Senate and House Committees are under deadline to recommend changes in spending and tax laws in the next two weeks. These changes will form two "reconciliation" bills implementing the agreement between Congress and the President to balance the budget over the next five years. Republican leaders say they want the House and Senate to pass their first versions of both reconciliation bills by the end of this month in order for the President to sign them next month. The first reconciliation bill proposes to cut $137.2 billion in gross deficit over the next five years. The second bill would cut taxes by $85 billion over the next five years.

Medicaid And Medicare Mark-ups

The House Ways and Means Committee approved legislation to cut Medicare federal spending by $115 billion over the next five years by a vote of 36-3. Medical Savings Accounts (MSAs) and a cap of $250,000 for non-economic damages for medical malpractice were approved as an attempt to reduce Medicare expenditures.

AIDS Action is concerned that these provisions would negatively affect healthcare quality and access. MSAs would have devastating affects on the solvency and quality of the Medicare program, and the risk pool in the Medicare market. Limitations on medical malpractice compensatory damages would prevent injured health care consumers from seeking and obtaining damages; negatively affecting health care quality. Democrats proposed amendments to soften the impact of cuts in Medicare by increasing payments for hospitals that care for large numbers of low-income people, but were ultimately unsuccessful.

The House Commerce Committee was given the task to trim $15.3 billion from Medicaid, mostly through reduced federal payments to providers, primarily through reductions in disproportionate share hospital (DSH) payments. There are a number of provisions in the mark up that are of concern to AIDS advocates.

The Committee repealed the 1915(b) waiver, which will allow states to shift anyone into mandatory Medicaid managed care without federal oversight and with minimum quality standards. Attempts to protect hospitals serving large numbers of uninsured persons and Medicaid-eligible adults and children from the brunt of these cuts were not successful. Cost-based reimbursement will be eliminated for federally qualified health centers, with payments steadily decreasing until 2002 when payments could be reduced by up to 40 percent. Lastly, Medicaid managed care programs will be able to charge copayments similar to what is now allowed in fee-for-service. While these copayments may be minimal for each service, they quickly add up for people with HIV who require multiple doctor visits and medications; ultimately creating barriers to health care.

Welfare Mark-up

The Ways and Means Committee marked up welfare provisions this week. The Committee increased welfare spending by $9.4 billion. Republicans broke with the budget agreement's provision to restore Supplemental Security Income (SSI) eligibility to legal immigrants on SSI and those who might become SSI-eligible in the future, if they were legally in the country as of August 22, 1996. The Committee only restored SSI eligibility for those individuals already receiving SSI as of August 22, 1996. The Committee did adopt an amendment restoring SSI eligibility to senior citizens receiving these benefits as of August 22, 1996.

There was no provision for legal immigrants who are senior citizens in the budget agreement.

FDA Reform

The Senate Labor and Human Resources Committee, chaired by Senator Jeffords (R-VT) has postponed mark-up of S. 830, the Food and Drug Administration Modernization and Accountability Act of 1997, rescheduling it for next Wednesday, June 18th. The "reform" bill contains provisions that patient groups believe endanger the public's health and safety and that that threaten to derail the reauthorization of the Prescription Drug User Fee Act (PDUFA), a program that helps speed the drug approval process by requiring manufacturers to help underwrite the costs of federal safety and efficacy reviews. The Patient's Coalition, a group of patients and advocates, is particularly concerned with provisions that lower the effectiveness standards for new drugs, allow for fewer studies to prove medicines are safe and effective, allow approvals for new drug indications based solely on anecdotal evidence, and allow marketing approval of new drugs based on surrogate markers without any enforceable mechanism to confirm the clinical benefit of drugs through additional clinical studies.

There has also been a push to include provisions that would protect patients and consumers. The Patients' Coalition has proposed providing the FDA with the authority to require confirmatory clinical efficacy studies following any expedited or "accelerated" approval of new drugs for serious and life-threatening diseases. The FDA would be allowed to impose civil money penalties for failure to perform post-approval research. The FDA reform bill currently includes a much supported expansion of the HIV/AIDS clinical trial information program (1-800-TRIALS A) to all serious and life-threatening diseases as a way of improving patient access to information about experimental therapies.

For more information, contact:
Sara Collins
AIDS Action Council
1875 Connecticut Avenue NW #700
Washington DC 20009
202-986-1300, extension 3053
202-986-1345 (fax)
202-332-9614 (tty)

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This article was provided by AIDS Action Council. It is a part of the publication AIDS Action Weekly Update.