House Reconciliation Package
A Bill to Protect Our National Defense by Eliminating Waste in Other Federal Programs

 

1. Food Stamps – Total savings $36.026 billion over ten years.

 Restricting Categorical Eligibility: The Obama administrations has encouraged states to offer food stamp benefits to those that merely receive a TANF-funded brochure or gain access to an 800 number hotline. This has led to people getting food stamp benefits even though they are not eligible for the program. This provision would close that loophole and save $11.7 billion over ten years.

 Eliminating the SNAP “Heat and Eat” Loophole: Under current law anyone who receives LIHEAP funding also qualify for automatic increases in their food stamp benefits. Several states are abusing this loophole by sending $1 LIHEAP checks to individuals so they can qualify for more food stamp benefits. This provision would close that loophole and save $14.3 billion over ten years.

Eliminating the Indexing on SNAP Nutrition Education: Under current law, states have the option of providing nutrition education to food stamp recipients. This is 100% funded by the federal government. Currently the funding for this program is indexed for inflation. This proposal would end the automatic inflation increases and save $546 million over ten years.

Terminating the SNAP increase from the Stimulus: In the President’s stimulus package from 2009 there was an across the board increase to food stamp benefits. This was originally supposed to be terminated in FY 2018. Last Congress, House Democrats twice tried to move up the termination date to October 2013 to pay for a teacher’s union bailout and increasing school meal standards. This proposal would terminate the increase in July 2012 and would save $5.9 billion over ten years.

Eliminating the 50/50 cost share for SNAP Employment and Training Program: According to GAO there are 47 federal employment training programs, which create a lot of overlap. This proposal would eliminate this program thereby decreasing the overlap and saving $3.1 billion over ten years.

Eliminating State Performance Bonuses Under SNAP: States are responsible for administering the food stamp program. Under current law, states can receive a bonus for doing a good job. The federal government should not reward states for doing jobs with additional money. This proposal would eliminate this program and save $480 million over ten years.

2. Obamacare – Total savings $75.372 billion over ten years.

Fully Recapturing Exchange Subsidy Overpayments: In Obamacare there is a provision that deals with the overpayment of exchange subsidies. These subsidies are calculated on old data and are updated as new data on income becomes available. The problem stems from a provision that caps the maximum amount an individual has to pay back to the federal government should there be an
overpayment. This provision would change this to require all overpayments to be paid back to the government. It would save $43.9 billion over ten years.

Eliminating Prevention and Public Health Slush Fund: Obamacare created a slush fund with an advanced appropriation of $16 billion for the first ten years and $2 billion for every year afterwards. These funds can be used by the Secretary basically as she sees fit. Last year Congress passed legislation to completely repeal this fund. This provision would save $11.9 billion over ten years (some of these funds were used to offset doc fix earlier this year).

Repealing Unlimited Obamacare State Exchange Grants: Obamacare provided the Secretary a direct appropriation of “such sums as necessary” for grants to states to facilitate purchase of health plans in the new exchanges. These funds are provided without further congressional action. Last year Congress passed legislation to completely repeal this fund. This is the identical provision and would save $14.5 billion over ten years.

Defunding of the CO-OP Program: Obamacare created the Consumer Operated and Oriented Plan program and appropriated $6 billion for it. This program gives loans to qualified non-profit health insurance plans. The concern is the program has been issuing loans outside the basic criteria for the program including to union entities. OMB estimated 50% of all loans will not be repaid, therefore wasting taxpayer dollars. This provision would rescind all unobligated funds saving $872 million over ten years.

Rebasing the Disproportionate Share Hospital (DSH) Allotments in FY 2022: Obamacare includes annual DSH reductions between FY 2014 and FY 2020 but allows allotments to revert to prior levels post FY 2021. The payroll tax deal passed several months ago included a rebasing for FY2021. This provision would extend this for FY 2022, which was also requested in the President’s budget. This would save $4.2 billion over ten years.

3. Medicaid – Total savings of 18.54 billion

Repealing the Medicaid Maintenance of Effort (MOE) Requirement Imposed on States: Under current law, there is a maintenance of effort requirement that prohibits states from having eligibility standards, methodologies, or procedures under state Medicaid or SCHIP plans that are more restrictive than the ones passed at the time of Obamacare. This prevents states from verifying eligibility, therefore preventing improper payments. This proposal would repeal the MOE requirement and give states more flexibility and save $600 million over ten years.

Repealing the Increased Federal Medicaid Funding Cap and Match Rate for Territories: Obamacare increased federal Medicaid match rates for the territories from 50% to 55% and increased the cap on federal Medicaid spending directed to the territories by $6.3 billion over ten years. This proposal would reverse these two changes in Obamacare and save $6.3 billion over ten years.

Reduce the Medicaid Provider Tax Threshold to 5.5%: Under current law states are able to use revenues from health care provider taxes to help finance the state share of Medicaid expenditures and receive federal matching funds even in instances where the taxes are largely rebated to the health care provider. This tax is currently capped at 6%. This provision would drop it by half a percent. The President’s budget phases it down to 3.5%. This proposal saves $11.24 billion over ten years.

Repeal of Bonus Payments for States for Increasing their Medicaid Enrollment: Under the 2009 SCHIP authorization states could be given bonus payments if they increase their Medicaid enrollment above a defined baseline from the prior year. This encourages states to implement oversimplified eligibility procedures that lead to less restrictive eligibility. CMS noted in FY 2011 Medicaid overpayment due to poor eligibility review led to $15 billion cost to the taxpayer. This proposal would repeal the bonus payments and save $400 million over ten years.

4. Reforming Programs – Total Savings of $161.9 billion over ten years

Preventing Abuse in the Refundable Child Tax Credit: Current law provides for a child tax credit of $1,000 per child ($500 beginning in 2013). This credit is partially refundable, meaning some individuals get a check from the federal government. Due to a loophole in the law this credit is given to those who do not have social security numbers because they are ineligible to work here (illegal aliens). This provision would close this loophole and prevent checks going to illegal aliens working here in the U.S. This would save $7.6 billion over ten years.

Reforming the National Flood Insurance Program: Last year the House passed a five year reauthorization of the flood insurance program. It reformed the system by eliminating unnecessary rate subsidies and phasing in more actuarial sound rates. This proposal is exactly the same as the one passed last year and it would save $4.9 billion over ten years.

Requiring Federal Employees to more Equitably Share in the Cost of their Retirement Benefits: Federal employees receive very generous retirement benefits in comparison to their private sector peers. This proposal would increase employee contributions by 5% of the salary over five years for current federal employees. Members of Congress would pay an additional 8.5% of their salary. This proposal will save $80 billion over ten years.

Reforming the Medical Liability System: Recently the House passed similar legislation as part of the payfor attached to the IPAB repeal. Both Energy and Commerce and Judiciary have reported out language concerning this medical malpractice reform. The E&C language would save $64 billion over ten years.

Eliminating Automatic Funding of the New Bureaucracies: One of the main pieces of the Dodd-Frank Act was the Consumer Financial Protection Bureau (CFPB). By design this bureau does not get its funds from the appropriations process but rather has the authority to draw as much money as
it wants from the Federal Reserve. This gives Congress no tool of accountability for this agency. This proposal would force funding for the CFPB to come through the Congressional appropriations process and save $5.4 billion over ten years.

5. Eliminating or Repealing Programs – Total savings of $41.8

 Protecting Taxpayers by Eliminating the Dodd-Frank Bailout Fund: The Dodd-Frank Act gave the FDIC “Orderly Liquidation Authority,” which gives bureaucrats authority to use taxpayer money to bail out creditors of “too big to fail” institutions. This would pave the way for future bailouts. This proposal eliminates this program and saves $22 billion over ten years.

Terminating Ineffective Housing Bailouts: HAMP is the signature program established by the Obama administration to address the housing foreclosure issue. It was supposed to help four million homeowners but has been marred with trouble from the very beginning and been subject to attack by both the left and the right. Even the New York Times has highlighted how the program has hurt, rather than help, many struggling homeowners. This proposal eliminates this program and would save $2.8 billion over ten years.

Eliminating the Early Retirement Social Security Equivalent Benefit for Federal Employees: Under current law federal employees who voluntarily retire early (before age 62) receive a special benefit on top of their retirement until they reach age 62. Essentially, they are paid more if they retire before reaching Social Security retirement age. This benefit is not available to the private sector. This proposal would eliminate this benefit for new hires. Since the savings will be outside of the ten year budget window this does not have a budgetary savings.

Repealing the Social Services Block Grant: This program originally served as a flexible source of federal funds for states to use on social services. It started as a match program but has morphed into a 100% federally funded program. This program duplicates a lot of work already being done by other programs, has no clear mission, and can be used on anyone regardless of their income level. This proposal eliminates the program and saves $17 billion over ten years.