Viewed through the lens of the approaching holidays, the spending bill Congress wrapped up last weekend is a mixed bag for the Affordable Care Act and other health programs.

Overall, the big gift is that the major health care cuts House Republicans had proposed earlier in the year were averted. But some programs and ACA initiatives will get Grinch treatment if President Obama signs the omnibus spending bill as expected. And perversely that may leave even less money for next year.

The bill authorizes nearly $1 trillion in spending to keep nine major areas of the federal government in operation through the end of the federal fiscal year which ends September 30, 2012. It was passed by the House Friday and the Senate Saturday, avoiding the gridlock of last year largely because the spending totals were defined by the Budget Control Act of August as part of the deal to raise the amount of money the federal government could borrow. But the details of how $6 billion in cuts would be spread across the nine areas were decided by congressional committees over the last few weeks.

One key Affordable Care Act initiative designed to help hold down growing health costs – the Independent Payment Advisory Board – got gutted. The ACA established the board to recommend cuts in Medicare spending starting in 2013 if needed. But the board, yet to be set up, has been a favorite target of those opposing the ACA, and the new spending bill cuts the board’s funding from $15 million to $5 million. It’s unclear if the board will be able to fulfill its promise of recommending smart savings.

Congress took a more charitable view toward the Prevention and Public Health Fund, including the full $1 billion authorized in the ACA, which will help reduce spending in the long run by preventing illness. Some of the money is being used to backfill programs previously supported with other federal dollars, such as the proven Racial and Ethnic Approaches to Community Health program. Community Transformation Grants are funded at $280 million, up from $145 million in 2011.

The expansion of community health centers to serve millions more people, another provision of the ACA, will continue. The centers got level operating funding, and about a $200 million increase from funding in the ACA. And Children’s Hospitals Graduate Medical Education Program will also be level funded (although the program still requires long-term reauthorization).

Other areas got more coal in their stockings:

  • • The ACA initiative to support development of Consumer Operated and Oriented Plans (CO-Ops) to compete with private insurers will be cut $400 million (following a $2.2 billion cut last year), leaving only $3.4 billion to support start-up.
  • • The Substance Abuse and Mental Health Services Administration will be cut $27 million, although two programs that send money to the states – the Substance Abuse Block Grants and Mental Health Block Grants – will see increases.
  • • The National Health Service Corps, which trains doctors to serve disadvantaged communities, will be cut by $24 million, a substantial chunk of change that is partly offset by funding in the Affordable Care Act.
It isn’t a great year for ribbons and bows.

–– Alice Dembner, Deputy Policy Director