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August 7, 2019

The latest developments and trends in federal affairs impacting allied health education.

Congress departs Washington with budget agreement in hand, but many other issues left unfinished.

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BUDGET AND APPROPRIATIONS

Two year budget agreement enacted - what’s next?

On Friday, President Trump signed a budget agreement for FY 20 and FY 21, providing top line spending levels for defense and domestic programs and a two year extension of the debt limit. This funding bill passed on a bipartisan basis in the House and Senate and contains a 4.5% overall increase in FY 20 for domestic programs above current FY 19 funding levels and that total increases in FY 21 to 4.9% over FY 19 levels.

The enactment of this agreement through FY 21 also means the end of the Budget Control Act of 2011, which will expire in 2021 and was a deficit reduction effort designed to prevent Congress from breaking pre-negotiated “budget caps” for each fiscal year by the threat of automatic across the board cuts. Overall discretionary spending was reduced from 8.7% of GDP in FY 2011 to a projected 6.2% in FY 21, even though these budget caps were set aside by Congress in eight out of the ten years of the Budget Control Act.

FY 20 Appropriations process moves into high gear

The next step of the budget process is the development of annual spending bills by the Appropriations Committee. The Senate just left for a five week recess, but Appropriations Committee Chair Richard Shelby (R-AL) is moving forward to prepare his FY 20 appropriations bills. To date, none of the Senate Appropriations bills have been crafted, as the Senate leadership sought passage of the FY 20 budget agreement before moving forward.

Shelby is now jumpstarting this process by providing each of his subcommittees with their own funding allocations, allowing the subcommittee chairs to craft their bills over the recess. He intends to begin committee approval or “mark ups” of his appropriations bills when Congress returns to Washington the second week of September.

ASAHP met with key Hill players in this process today and we were told to expect the Labor-HHS-Education (Labor-HHS) bill to be marked up the week of September 9th when Members return to Washington, but with significantly less overall funding than passed in the House earlier this summer. The Labor-HHS bill will be combined with the Defense bill in full Committee to help ensure its swift passage. The strategy of pairing the Defense and Labor-HHS bills was successful last year and Shelby hopes it will again bear fruit this year to move the Labor-HHS bill to enactment.

However, the real challenge is there are just thirteen work days between the return of Congress in September and the end of the Fiscal Year on September 30th and Hill insiders expect that a Continuing Resolution will be utilized to keep the government running into December.

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Different spending levels in the House and Senate will make conference a challenge

Unlike the Senate, the House approved ten of its twelve appropriations bills before the end of June. They did so by creating (i.e. “deeming”) their own top line funding level in the absence of a budget agreement --- but the newly passed budget agreement does not reflect the House deemed levels. Instead, it provides $15 billion less overall funding for domestic programs and $5 billion more for defense.

As a result, we are told to expect the Senate Labor-HHS bill to have significantly less overall funding than the unprecedented $11.7 billion boost (5.7% increase) in the House Labor-HHS bill.

This marked funding difference between the House and Senate bill sets up a difficult dynamic when the two chambers come together in Conference to negotiate the differences in their bills.

While we will not know the overall funding level in conference for Labor-HHS for a number of weeks, a five percent funding decrease below the House passed levels is quite possible. Such a steep cut reflects not only less funding for domestic programs as part of the budget agreement, but also the absorption of Labor-HHS’ proportionate share of an across the board cut to pay for veterans’ private health care.

If a five percent cut below House passed levels becomes a reality, it will mean that House and Senate negotiators in the Labor-HHS conference will only have roughly $3 billion more to work with than in FY 19 (1.6%), which does not provide appropriators much flexibility to either provide programmatic increases in FY 20, or fund new initiatives, for other than their highest priorities. Increases contained in the House bill for education and workforce programming could be highly vulnerable in these negotiations.

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No more policy riders

One other component of the budget agreement will have a significant impact over the next two years – the exclusion of “policy riders”, provisions in appropriations bills which provide specific directives that prevent federal agencies from engaging in certain activities. Historically, policy riders have been utilized by Congress to reign in the Administration’s regulatory or administrative matters that Congress finds to be objectionable. For FY 20 and FY 21, policy riders will only be included in appropriations bill if there is an agreement by Congress and the Administration, which defeats the purpose of such riders by requiring the Administration’s assent.

As a result, the Administration will have unfettered ability to engage in funding, regulatory, or administrative activities, so long as they are within the bounds of the laws under which they operate – without the input of a co-equal branch of government, the Congress.

This significant power shift to the Executive Branch will allow the Administration to accelerate its implementation of a variety of rulemaking in higher education which is expected to be introduced in the next few months including:

  • Non-degree credentialing with Title IV financial aid funds;

  • Elimination of the credit hour;

  • Accelerating the use of competency based education; and

  • Expansion of protections for religious schools.

It will also reduce the ability for Congress to prevent the further implementation of rules already proposed on other contentious issues such as:

  • Title IX campus sexual assault;

  • Easing federal requirements on accreditation;

  • Gainful Employment; and

  • State Authorization (though this proposed rule keeps the S.A.R.A. process intact, which ASAHP supports).

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HIGHER EDUCATION ACT REAUTHORIZATION

HEA reforms stalls in the Senate

The importance of the Department of Education’s higher ed rulemaking is magnified by HEA reauthorization efforts stalling in the Senate according to key Hill sources.

While Senate HELP Committee Chair Lamar Alexander (R-TN) and Ranking Member Patty Murray (D-WA) have been working throughout the year to find a bipartisan HEA bill, differences in issues, regarding Title IV student financial aid and how to properly review Title IX sexual harassment cases on campus, have been difficult to bridge to date.

On the House side, Education and Labor Committee Chair Bobby Scott (D-VA) told ASAHP that he is drafting his own HEA reauthorization bill and hopes to have a draft composed sometime in September (or early October). This will be a Democratic bill and provide a more holistic approach to student assistance and likely include many of the priorities in the HEA bill he authored last Congress, the Aim Higher Act.  

However, if Chairman Scott’s bill only reflects House Democrats priorities for HEA reauthorization, it will be a message bill, rather than one that can pass in both the House and Senate.

The deadlock in HEA reauthorization means that the Department of Education’s rulemaking in this arena will be kept in place for the next two years, without influence from Congress, in the absence of a new HEA statute.

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Bipartisan ISA bill introduced in the Senate

Separate from this HEA discussion has been the introduction of a bipartisan bill to further test the Income Sharing Agreements (ISA), which have been utilized at Purdue University and allow students with contracts to have their tuition paid by nongovernmental entities in exchange for a portion of a student’s income for a period of years, with consumer protections safeguards included for participating students.

Senators Todd Young (R-IN), Mark Warner (D-VA), Marco Rubio (R-FL), and Chris Coons (D-DE) are the sponsors of this bill, which is designed to help reduce the federal student loan burden, particularly for students who are not eligible for Title IV student financial aid.

While this bill is not expected to be enacted in the near term, it is another example of alternative financing mechanisms being discussed in Congress to reduce student debt.

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House Energy and Commerce Committee passes Title VII reauthorization

Before departing for recess in the House, the Energy and Commerce Committee approved 25 bills, including the EMPOWER Act, which would reauthorize Title VII health workforce programming. The bill includes a provision providing $5 million annually to support diversity efforts in physical therapy, occupational therapy, and speech language pathology. ASAHP worked with both the Committee and the professional associations supporting this effort and provided the Committee with a formal letter of support for this bill. No companion measure has been introduced in the Senate.

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ASAHP Supports POST GRAD Act

ASAHP, along with seventeen national postsecondary health workforce organizations, signed a letter of support for H.R. 3418, the Protecting Our Students by Terminating Graduate Rates that Add to Debt Act. The bill’s sponsor is Ways and Means Committee Member Judy Chu (D-CA) and would reinstate graduate and professional student eligibility for Federal Direct Subsidized Loans, a cohort eliminated in the Budget Control Act, ensuring students would no longer accrue interest on federal loans while completing their education.

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ASAHP Endorses Pathways to Health Careers Act

In June, House Democrats introduced HR 3398 the “Pathways to Health Careers Act” – its reauthorization of the Health Profession Opportunity Grant (HPOG) program, for which the authorization is set to expire on September 30.

This bill provides $1.7 billion in mandatory funding over four years, a five-fold expansion over current funding levels and greatly expands opportunities for individuals to develop the education and skills required to enter a host of allied health professions and nursing, particularly for low income individuals.

ASAHP has worked closely with House Ways and Means Committee staff in support this legislation, which will likely be marked up in the House Ways and Means Committee when Members return to Washington next month.  

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