Health Law Daily Wrap Up, PROGRAM INTEGRITY—CBO REPORTS: Congressional spending hasn’t exceeded appropriations, no sequestration, (Dec 29, 2015)
A sequestration will not be required in 2016 because enacted legislation for the current fiscal year has not exceeded the discretionary budget authority of Congress, according to the Congressional Budget Office (CBO) Final Sequestration Report for Fiscal Year (FY) 2016. The report sets out the CBO’s estimates of the limits (or caps) on congressional discretionary budget authority for each fiscal year through 2021. The estimate includes appropriations for spending on program integrity initiatives for Medicare, Medicaid, and the Children’s Health Insurance Program (CHIP) (CBO Report, December 28, 2015).
2016 budget. The Bipartisan Budget Act of 2015 (P.L. 114-74) sets the caps on defense and nondefense funding for FY 2016 at $1,066.6 billion. The majority of the spending is devoted to defense, while the cap for nondefense programs—including health care spending—is set at $518.5 billion. An additional $83.1 billion in adjustments have been made due to certain appropriations. Most of the spending increase is related to defense spending, but about $1.5 billion of the added appropriations is directed towards program integrity initiatives for programs including Medicare, Medicaid, and CHIP. According to the CBO’s estimates, although the adjustments bring total spending up to $1.15 trillion, appropriations are equal to the caps for the fiscal year. Therefore, no sequestration will be required. However, if Congress makes additional appropriations before the end of September 2016, without reductions in other spending, the action would result in sequestration.
2017 budget. The report also addresses spending for FY 2017 and beyond. Under the Bipartisan Budget Act, the cap on nondefense program spending for FY 2017 is $519 billion. The report estimates how automatic procedures will impact budgetary caps moving forward through FY 2021. For example, in FY 2021, the CBO estimates that nondefense programs will have a revised cap of $555 billion. The CBO report also contains a caveat that its findings are estimates and that the final determination of a need for sequestration is made by the Administration’s Office of Management and Budget (OMB). When deciding the need for sequestration, the OMB will make and use its own federal spending estimates.
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