2002 National Health Care Legislative Update

At the beginning of the 107th Congress, several health care issues loomed large on the agenda. In the end, however, relatively little was accomplished. Action on health care issues was inhibited by the slow start to the new Administration, the change in Senate control six months after the elections, the September 11,2001, terrorist attacks that overwhelmed the domestic legislative agenda and altered the pre-existing political environment, and sharp partisan disputes. In addition, the re-emergence of significant budget deficits and the installation of an Administration favoring restrained domestic spending and lower taxes has constrained the resources and political support for some health care initiatives. Finally, certain agenda items that were expected to be resolved during a post-election, "lame duck" session fell by the wayside when that session proved unexpectedly short lived.

I. Significant Measures and Actions Adopted

Several health care-related measures did make it into law during the 107th Congress; and the administration took several noteworthy actions. Perhaps the most significant action was a comprehensive re-write of the Frist-Kennedy Act to provide authorization for bioterrorism preparedness and response activities, including preparedness grants to states and hospitals, a variety of education and training activities, and a massive expansion of existing medical stockpile, disaster response, research and vaccination activities. In addition, Congress also enacted legislation to reauthorize the consolidated health centers program for another five years. While a comprehensive re-write of the statute authorizing the Food & Drug Administration was put off, Congress did reauthorize the Prescription Drug User Fee Act (PDUFA), a program providing for drug manufacturers to pay user fees to FDA to support improved review processes. A similar law was enacted for medical device review.

On the health insurance front, legislation providing for parity in the provision of mental health benefits by private health plans was again extended, and the Trade Act of 2002 created a tax-credit subsidy to cover 65% of the health insurance premiums for workers who lose their jobs due to trade policy.

At the administrative level, HHS Secretary Thompson initiated an effort at Medicare administrative reform that included renaming the Health Care Financing Administration (HCFA) as the Centers for Medicare and Medicaid Services (CMS) and accelerating the review of onerous regulations and practices. The Secretary's Advisory Committee on Regulatory Reform (SACRR) recently issued 250 recommended changes. The President also directed the Food & Drug Administration to issue a proposed regulation that would restrict the ability of prescription drug manufacturers...