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Executive Summary

CATASTROPHIC CARE MODIFICATION LEGISLATIVE VEHICLE is expected to be either budget or debt limit measures, House Budget Committee Chairman Panetta (D-Calif.) told budget conferees Oct. 25. Modification of the Medicare catastrophic care law will be "driven either on [budget reconciliation] or on the [federal] debt limit" extension bills, he said. Panetta added that the provision might be addressed as part of the budget conference so the issues can be resolved as soon as possible. If catastrophic care is discussd during the budget reconciliation conference, the Senate may use the retention of the present catastrophic care law, with its full outpatient drug benefit, as its negotiating position. The House will start the negotiations with the repeal amendment, adopted by that chamber earlier this month. While the Senate passed a modification plan sponsored by Sen. McCain (R-Ariz.) by a 99-0 vote, the proposal was approved as a free-standing measure and not as part of the reconciliation bill ("The Pink Sheet" Oct. 9, p. 13). However, McCain staffers said they expect conferees to advocate the Senate modification plan, and hope that it will be adopted as a middle ground between repeal and current law. Under the McCain bill, coverage is repealed for all drugs except home I.V. and immunosuppressive treatments. Sen. Roth (R-Del.), a catastrophic care repeal proponent, said on the Senate floor Oct. 25 that he is "deeply troubled" by "rumors" that the Senate would go to conference with current law. "This means we may end up with benefits and a package that the Senate already rejected," he said. "Turning around and coming up with such a package through conference deliberations, at the very least, would be a violation of the people's trust." In other budget reconciliation proceedings, conference Chairman Panetta had urged subconferences to resolve differences on deficit reduction measures by Oct. 27, leaving discussions on "extraneous matters" until the following week. If conferees cannot reach agreement on the bill in a timely fashion, the House will agree to eliminate from its legislation provisions that do not directly affect the fiscal year 1990 budget deficit, Panetta said. At the Oct. 25 public session, House and Senate members sparred over what issues should be discussed during the budget reconciliation conference. In general, Senate members are pushing their stripped-down approach while the House continues to be reluctant to forfeit measures passed as part of its budget bill. In addition to the catastrophic care repeal, the House budget bill includes provisions modifying and permanently extending the current research and experimentation tax credits. House Ways and Means Committee Chairman Rostenkowski (D-Ill.) is urging that the Senate not add measures stripped from its reconciliation bill to the legislation raising the federal debt limit, which is scheduled for consideration before the end of October. However, Sen. Durenberger (R-Wis.) is working on an amendment to the federal debt limit that would include most of the provisions stripped from the budget bill. Among the provisions are a permanent extension of the R&E tax credits and an authorization of Medicare reimbursement for erythropoeitin (Amgen's Epogen) administered at home. * Because of Rostenkowski's position on the debt limit bill, chances are remote that Panetta's timetable will be met. Until Congress completes action, Gramm-Rudman across-the-board cuts are in effect. For FDA, that means a reduction of $28.3 mil. in budget authority and $22.6 mil. in outlays for program expenses.

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