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Summary:
Each year, the President is required to submit a comprehensive federal budget proposal to Congress no later than the first Monday in February. Once it is submitted, the Congressional Budget Office (CBO) analyzes the proposal using its own economic assumptions and estimation techniques. Then, the House and Senate Budget Committees each develop a budget resolution after reviewing the President's budget, the views of other committees, and information from CBO. Differences between the houses are supposed to be resolved by April 15, but this deadline is rarely met. Although it is not binding, the resolution provides a framework for subsequent legislative action on the budget. The President's FY2008 budget contains a number of proposals that would affect Medicaid and the State Children's Health Insurance Program (SCHIP). Some are program expansions, and others are designed to reduce federal spending. While certain proposals would require legislative action, others would be implemented administratively (e.g., via regulatory changes, issuance of program guidance, or other possible methods). The President's budget also contains a number of proposals that would affect health insurance. On May 17, the House and Senate adopted a conference agreement on the budget resolution (H.Rept. 110-153 accompanying S.Con.Res. 21). The FY2008 budget resolution provides a reserve fund of up to $50 billion for SCHIP legislation that is deficit-neutral in the Senate and deficit/surplus-neutral in the House, a variety of other deficit-neutral reserve funds, up to $383 million for health care fraud and abuse control, and two "sense of the Congress" provisions regarding health care cost growth and affordable health coverage. To date, a number of Medicaid and SCHIP issues have seen legislative action in the 110th Congress. A war supplemental appropriations bill enacted on May 25 (H.R. 2206, P.L. 110-28), contains SCHIP funding, delays implementation of certain Medicaid administrative proposals, requires the use of tamper-resistant pads for Medicaid prescriptions, and provides a Medicaid Pharmacy Plus waiver extension. Legislation was also enacted to temporarily extend Medicaid transitional medical assistance through September 30, 2007 (S. 1701, P.L. 110-48). On the issue of SCHIP reauthorization, numerous bills have been introduced. The Children's Health Insurance Program (CHIP) Reauthorization Act of 2007 was passed by the Senate as an amendment to H.R. 976 on August 2. The Children's Health and Medicare Protection (CHAMP) Act of 2007 was passed by the House on August 1. A conference to resolve differences between the bills is expected after the August recess. This report will be updated as the FY2008 budget process unfolds.
