Legislation & Politics

Week Ending April 11, 2008

Congress – The Week of April 7, 2008


House subcommittee adopts bill to block Bush regulatory cuts to Medicaid. Speaker Pelosi derails Colombia Free Trade Agreement. Senate approves housing foreclosure bill.

House Subcommittee Adopts Bill to Block Bush Regulatory Cuts to Medicaid

The Health Subcommittee of the House Energy and Commerce Committee adopted legislation (H.R. 5613), supported by AFSCME, which would establish a moratorium until April 2009 on seven Medicaid regulations recently issued by the Centers for Medicare and Medicaid Services (CMS). The bill had bipartisan support and would stop implementation of CMS regulations intended to cut Medicaid and shift costs onto states already in fiscal crisis. The regulations blocked would cut funds to states by limiting federal and state Medicaid payments to public hospitals, limiting payments for targeted case management, prohibiting federal reimbursement for the costs of transporting Medicaid-eligible children to school and administering Medicaid services at schools, limiting payment for certain rehabilitative services, eliminating all federal Medicaid reimbursement to teaching hospitals for medical student education, reducing reimbursement for outpatient hospital services, and limiting state options for funding Medicaid. The bill is expected to be considered by the full committee next week. AFSCME has been lobbying for passage of H.R. 5613 and for fiscal relief for states in budgetary crisis. 

Senate Panel Examines White House Efforts to Reduce Coverage Under the State Children's Health Insurance Program (SCHIP)

The Senate Finance Committee held a hearing this week to examine an August 2007 directive issued by the Administration that imposes new and insurmountable hurdles for states that have expanded or want to expand health coverage to children in lower-income families. Twenty-three states now provide, or were planning to provide, coverage to children in families with incomes above 250% of poverty, or about $44,000 annual income for a family of three. While many families in this income level get affordable coverage through their jobs, many are not so lucky. And as the economy worsens, the number of uninsured children will surely grow.

 As a result of the August directive, states that continue to provide coverage above this income level will be forced to do so without any federal financial assistance. In addition to the financial burden this places on the states, the directive will cause tens of thousands of children to lose coverage. Already 26,000 children in three states have lost coverage. Finance Committee member Sen. John D. Rockefeller (D-WV) has introduced legislation (S. 2819) that would prevent the Administration from implementing the new directive. 

Farm Bill Moves - A Little

House and Senate members appointed to a conference committee to resolve differences between the House and Senate farm bill finally met for the first time this week. For months, efforts to work out the overall cost of the bill and a way to pay for proposed increases have been unsuccessful.

This week House conferees made a bipartisan offer to the Senate which included an additional $9 billion for nutrition assistance. The Senate will consider it and likely counter with another proposal by early next week. It is still unclear whether a final agreement can actually be reached. The deadline for the current extension is April 18.

In the meantime, AFSCME has been meeting with representatives from a number of non-profit organizations to attempt to iron out some concerns they have about the impact of the anti-privatization provision in the House bill on the outreach efforts they conduct to help applicants apply for food stamp benefits. 

Unemployment Benefits Legislation Introduced

Responding to the rise in unemployment and the unusually high number of workers unemployed for more than 26 weeks, Rep. Jim McDermott (D-WA), Chairman of the House Income Security and Income Security Subcommittee, and Rep. Phil English (R-PA) introduced legislation this week to provide extended benefits.

The Emergency Extended Unemployment compensation Act (H.R. 5749) would provide all workers exhausting their regular 26 weeks of state benefits an additional 13 weeks of benefits. In addition, workers living in states with unemployment rates of 6% or more would receive an additional 13 weeks for a total of 26 weeks of federal extended benefits.

The subcommittee held a hearing on the legislation this week and plans to report the bill to the full Ways and Means Committee as soon as next week.

Speaker Pelosi Derails the Colombia Free Trade Agreement and Delivers a Devastating Blow to Fast-Track Authority

On April 10th, Speaker Pelosi and House Democrats reasserted Congress' role in trade and adopted H.Res. 1092 by a vote of 224 to 195. The resolution removed the 90 day fast-track requirement for the Colombia Free Trade Agreement (FTA) and sent a clear message to President Bush that Congress cannot be forced to fast-track another flawed trade bill. AFSCME supported the resolution and will continue to oppose the FTA until Colombia has substantially improved workers rights. 

Senate Approves Housing Foreclosure Prevention Bill and House Bill Advances

The Senate voted 84-12 to approve final passage of a controversial housing foreclosure prevention package, which includes a much needed $4 billion for states and localities to redevelop vacant or abandoned properties, gives away $6 billion of unnecessary and wasteful tax breaks to businesses, and omits some important assistance needed by overburdened homeowners at-risk of foreclosure and bankruptcy. Despite pressure from consumers, affordable housing advocates, and vocal dissent by key House and Senate leaders, the Senate voted 58-36 to reject authorizing judges to alter the terms of loans in bankruptcy proceedings. To address America's dependence on foreign energy sources, the Senate also voted 88-8 to approve an amendment to extend for one year expiring tax breaks for renewable energy and energy efficiency, which cost $6 billion. The total cost of the tax breaks is $17 billion.

The House Ways and Means Committee voted 35-5 to approve its own revenue-neutral $11 billion tax package (H.R. 5720) designed to help home buyers and low-income renters. The committee's package will be linked to separate provisions that the House Financial Services Committee is developing, which are expected to be more consumer friendly. The House and Senate packages are expected to be quite different, and President Bush is likely to disagree with key provisions in each package. 

House Ways and Means Committee Approves Plan to Eliminate IRS' Private Collection Agencies

The House Ways and Means Committee voted 23-17, on party lines, to approve a revenue-neutral tax package (H.R. 5719), including a ban on the Internal Revenue Service (IRS) contracting out tax collections to private collection agencies. The measure would terminate the IRS's current outsourced pilot program, which the IRS previously testified is more expensive and less effective than doing the work within the IRS with government employees. Earlier, the committee voted 17-23, also on party lines, to reject a Republican amendment to strike the ban. AFSCME strongly supports this anti-privatization provision as part of a broader position that all inherently governmental functions, such as tax collection, should be performed by government employees. Although controversial, this provision is expected to pass the House.

H.R. 5719 would impose an employment tax for wages paid to workers of foreign subsidiaries of U.S. businesses under U.S. government contract. This harmful practice is repeatedly used by many federal contractors to avoid paying U.S. Social Security and Medicare payroll taxes by setting up their corporate headquarters overseas. 

House Judiciary Committee Hears Testimony Regarding the Re-Opening of the 9-11 Victim's Compensation Fund

The House Judiciary Committee held a hearing "Paying with their Lives: The Status of Compensation for 9/11 Health Effects."  Discussion centered on how the Victim's Compensation Fund (VCF) could be re-opened to fairly compensate disabled victims and their families and why New York City is using the $1 billion "captive insurance fund" to pay attorneys to logjam claims instead of compensating victims. There was unanimity on the committee regarding the need to compensate victims and their families.

The hearing, however, did not sufficiently address the logjam of workers' compensation claims and the failure of workers' compensation to address the enormity of the impact of 9/11. AFSCME has been discussing this key issue with Congress and working hard to move the 9/11 bill to authorize both the re-opening of the VCF and the monitoring and treatment program toward committee action. 

House Committee Approves Fast-Track Legislation to Provide Federal Assistance for Student Loans

The House Education and Labor Committee responded to turmoil in the U.S. credit markets affecting student loans and approved the Ensuring Continued Access to Student Loans Act of 2008 (H.R. 5715) that would provide new protections to ensure that families continue to have access to federal college loans. The bill would reduce borrowers' reliance on costlier private college loans, give parent borrowers more time to begin paying off federal PLUS college loans, help struggling homeowners pay for college, and provide the U.S. Secretary of Education with additional opportunities to assist guaranty agencies and the federal guaranteed loan program. The effective date would be July 1st. The bill is expected to move quickly to help facilitate student loans for the coming academic year.

Sen. Edward Kennedy (D-MA) also introduced student loan legislation last week, the Strengthening Student Aid for All Act (S. 2815), which also strives to reduce students' and families' reliance on high-cost private loans by increasing federal aid and strengthening the student loan program. S. 2815 protects students' eligibility for and access to loans, and provides an alternative capital source for lenders who need it to continue making federal loans at a minimal cost to taxpayers. This bill is expected to move through the Senate soon and will then be conferenced with H.R. 5715. 

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