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Monthly Legislative Newsletter: September 2023
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Congressional State of Play

The Senate returned from the August recess on September 5, with the House following a week later, concluding the annual summer break for legislators and bringing them back to Washington D.C. to face a busy slate of legislative business – still marred by lingering policy standoffs that have thus far prevented progress on a number of ‘must-pass’ priorities. Apart from the appropriations process that will be discussed below, Congress is running up against a September 30 deadline to reauthorize the Federal Aviation Administration and the Farm Bill, both of which were subject to drawn-out policy disagreements and delays imposed by the debt ceiling crisis that allowed the schedules for either reauthorization to drift off schedule over the course of the Summer. While the extended delays have led to increasingly likely rumors of short-term extensions for these authorizing bills, it remains to be seen if there is viable support across Congress for such an extension as these priorities get dragged into debates over broader government fiscal responsibility and policy. Though on an extended timeline that gives lawmakers until the end of the calendar year to reach a consensus, Congress will also need to pass a new version of the National Defense Authorization Act (NDAA) – though that process has also been tainted by similar policy fights over spending, climate, and social issues that have stalled progress on other major priorities.

In the Senate, Majority Leader Chuck Schumer (D-NY) is working hard to craft the narrative of the fall session, sending a letter to his colleagues ahead of their return to Washington to detail his priorities for the Senate before the end of the calendar year. Apart from Schumer’s goal of averting a government shutdown and passing the reauthorizations of key government programs, his letter indicates the Senate will be focusing on judicial nominees, artificial intelligence regulation, lowering the cost of prescription drugs, safeguarding cannabis banking, children’s online privacy, rail safety, and essential supplementary funding for Ukraine and natural disaster responses. What remains unclear is exactly how Leader Schumer intends to accomplish this vast array of policy priorities given the deeply entrenched policy divides that have thus far prevented progress on even historically bipartisan issues.

On the House side, Speaker Kevin McCarthy (R-CA) has avoided laying out any expansive policy goals for the fall legislative session in contrast to his Senate counterpart. Rather, Speaker McCarthy appears to be taking a much narrower focus, hoping to resolve the appropriations process and pending reauthorizations in the short work period before they are set to expire. Both priorities have kept the Speaker in a difficult bind for much of summer, torn between maintaining the support of the hardline fiscal conservatives of the House Freedom Caucus and more moderate members of his party, including Senate Republicans. At stake for McCarthy in this growing inter-party squabble is the fate of his Speakership, and more broadly the fate of funding for the federal government and authorizations for an array of government agencies if he is unable to find compromise between the diametrically opposed sides – a seemingly impossible position.

Appropriations Update:

In line with the strategy outlined in Schumer’s letter to his colleagues, the Senate is hoping to ‘move first’ on appropriations and gain leverage in their spending standoff with House Republicans. Leaders of the Senate Appropriations Committee, Chair Patty Murray (D-WA) and Ranking Member Susan Collins (R-ME), are planning floor action for next week on a ‘minibus’ or a small package of some of the Senate’s least controversial spending measures. Included in this first package being prepared for a floor vote are the funding bills for Agriculture-FDA, Military Construction – Veterans’ Affairs, and Transportation – Housing & Urban Development. After passing this package there is still an opportunity that we could see the Majority Leader elect to move the other spending bills individually, as has been requested by many Republicans. Doing so would mark the first time in years that the Senate has opted to pass its appropriations bills as standalone measures, providing greater opportunity for debate on individual provisions – as well as disagreement.

Issue Overview: IRA Medicare Drug Price Negotiations and Related Provisions

On Tuesday, August 29th the Biden administration announced the first 10 drugs that will be subject to price negotiations between Medicare and pharmaceutical companies. The historic move is the result of a key provision aimed at driving down the cost of important medications that was included in the Inflation Reduction Act (IRA) that was passed a year ago this August. A longtime priority of Democratic lawmakers, the IRA requires the Centers for Medicare and Medicaid (CMS) to designate 10 Medicare Part D eligible drugs for negotiations. While the administration’s announcement kicks off the process, drug companies have until October 1st to decide whether to engage with CMS, risking a significant excise tax or an exit from CMS coverage entirely if they fail to do so.