March 28, 2011—Congress has returned to work after a weeklong recess with the clock winding down on its latest stop-gap spending bill to keep federal agencies open.
The current continuing resolution expires on April 8. If the Democratic-led Senate and the Republican-led House cannot come to an agreement the government will be forced to close, including the Office of Pharmacy Affairs (OPA), the agency that oversees the 340B program.
OPA staff and management would be without a paycheck until the government reopens. It is unclear is whether furloughed OPA employees would receive back pay as they did during the last government shutdowns in late 1995 and early 1996.
Democratic and Republican leaders had declared that this would be the last temporary funding measure for fiscal 2011. But there have been no breakthroughs in negotiations with the White House on a long-term budget for the rest of the year.
Both sides say they want to avoid a government closure. But House conservatives are sticking to demands for about $60 billion in spending cuts and a prohibition on funding for health care reform’s implementation. Senate Democrats have rejected cuts of that magnitude and a ban on health reform-implementation funds.
Efforts to cut a long-term deal on fiscal 2011 spending could be complicated by the fact that the government will soon reach its statutory debt limit. Extension of the limit is considered must-pass legislation and some Republicans have said they will demand even deeper spending cuts as a condition for voting for the extension.
With its workload growing due to 340B’s expansion and its funding still up in the air, OPA has drastically curtailed its technical assistance to 340B stakeholders. It has also refrained from filling four open positions on its 19-member staff.
Meanwhile, the House Appropriations Subcommittee on Labor, Health and Human Services, Education and Related Agencies has held its first hearing on President Obama’s fiscal 2012 funding request for the Department of Health and Human Services. The President has proposed a new 0.1 percent user fee on all 340B purchases to raise $5 million for OPA’s operations. The White House is also seeking a $5.2 million appropriation for the office, which would lift its funding to $10.2 million.
Congressional Republicans are expected to issue their own spending plan for fiscal 2012 this week. There is some speculation that the plan might include a proposal to transform the federal share of Medicaid entitlement spending into a system of block grants. Several Republican governors called for the change during the National Governors Association meeting in Washington in February. The idea also has long been a favorite of House Budget Committee Chairman Paul Ryan (R-Wisc.).