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House Passes Stopgap Funding Fix, Averting Government Shutdown

No government shutdown tomorrow. Check back again in December.
Reuters
By Yuval Rosenberg and Michael Rainey
Friday, September 30, 2022

Good Friday evening! Congress avoided a government shutdown, kicking the can on long-term federal funding until December. And Hurricane Ian made landfall again Friday, this time in South Carolina as a Category 1 storm. The remnants of the hurricane are now a “post-tropical cyclone.” President Joe Biden said Friday that we’re just beginning to see the scale of destruction the storm left in Florida, where the death toll is reported to be at least 42.

Here’s what’s happening.

House Passes Stopgap Funding Bill, Averting Shutdown

Just hours before a midnight deadline, the House on Friday passed a short-term bill that will keep government agencies funded until December 16. President Joe Biden is expected to sign the bill into law later in the day.

The vote was 230-201, largely along party lines. All but 10 House Republicans opposed the bill, and they complained that it does nothing to address inflation, energy costs and security at the southern border. Many also wanted to extend the funding into January so that the new Congress, which they expect to include a Republican-controlled House, could put its stamp on the final 2023 fiscal spending package.

Some Democrats also complained that the bill fell short, with more than $20 billion in funding for treatments and vaccines for Covid-19 and monkeypox dropped from the package due to Republican opposition. But most lawmakers were eager to avoid a shutdown — and to head out of Washington so they could focus on the midterms back home.

“Despite these shortcomings, the investments included in this bill are urgent and necessary to avoid disruptions to vital federal agencies, to help communities get back on their feet, to ensure we have the time needed to negotiate a final funding agreement that meets the needs of hard-working people,” House Appropriations Chair Rosa DeLauro (D-CT) said on the House floor.

While holding government funding at current levels, the legislative package includes more than $12 billion in additional military and economic aid for Ukraine. It also provides $4.5 billion for disaster relief and $1 billion to help low-income households pay their heating bills this winter. A user fee that helps fund the Food and Drug Administration was also reauthorized for five years, averting potential layoffs at the agency.

An old and familiar habit: Congress has now failed to pass a budget on time for 26 years in a row. It’s also the fifth year in a row that both houses of Congress have been unable to pass even one of the 12 annual funding bills before the beginning of the new fiscal year, which starts on October 1. And the last-minute rush to avoid a shutdown is nothing new either, with Congress waiting until the last week to pass a short-term funding bill in eight out of the last 10 years.

“Passing a budget to fund the government is the most fundamental part of governing, and our leaders are failing—it’s as though the budget committees don’t even exist,” Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said in a statement.

Majority Leader Steny Hoyer (D-MD) addressed the issue Friday. “The good news is that the House and Senate have now sent President Biden a continuing resolution to keep the government open,” he said in a statement. “The bad news is that we needed a continuing resolution because the Congress did not complete its work on full-year appropriations. … we can and must do better.”

What comes next: Ideally, lawmakers will use the next 11 weeks to reach an agreement on 2023 spending levels, enabling them to pass a full-year budget in December. But with all attention turning to the midterms in November, there’s good reason to suspect that Congress may not have enough time to finish its work by the December deadline. Lawmakers will likely have to address other issues that crop up, such as additional disaster funding, and all negotiations over spending will no doubt be colored by the outcome of the midterm vote.

Asked whether he expects Congress to have a spending package ready to go by December, Sen. Mike Braun (R-IN), who sits on the Appropriations Committee, told The Hill: “If the past is any indication of what’s going to happen in the future, we’d be lucky for that to happen.”

Quote of the Day

“Biden likes to say, ‘Build back better.’ Well, that’s what Florida wants to do.”

Haley Barbour, a Republican who was governor of Mississippi from 2004 to 2012, in a New York Times article looking at the disaster response by Florida Gov. Ron DeSantis. DeSantis, also a Republican, has asked for federal relief funding in the wake of Hurricane Ian but opposed aid to victims of Hurricane Sandy when he was a congressman.

“The tonal whiplash for Mr. DeSantis reflects a different job and a different moment — a Tea Party-era House Republican now steering a perennially storm-battered state dependent once more on federal assistance to rebuild,” writes the Times’s Matt Flegenheimer.

New ALS Drug Will Cost $158,000 a Year

The Food and Drug Administration on Thursday approved a new medication for Amyotrophic Lateral Sclerosis (A.L.S), the debilitating and deadly neurological disorder also known as Lou Gehrig’s Disease. On Friday, the drug’s manufacturer, Amylyx Pharmaceuticals, announced the list price of the drug will be $158,000.

That list price, Pam Belluck of The New York Times notes, is far higher than the annual price of $9,100 to $30,700 recommended by the Institute for Clinical and Economic Review, a nonprofit that evaluates the value of drugs.

“Amylyx officials predicted that most patients would pay little or nothing for the treatment because the company expects insurers, both private and public, to cover it. Amylyx plans to provide it free to uninsured patients experiencing financial hardship,” Belluck reports.

She adds that the new drug, to be marketed under the name Relyvrio, was approved by the FDA “even though the agency’s analysis concluded there was not yet sufficient evidence that the medication could help patients live longer or slow the rate at which they lose functions like muscle control, speaking or breathing without assistance.”

The agency said the approval was merited even without additional evidence of the drug’s effectiveness because the medication is considered safe and “given the serious and life-threatening nature of A.L.S. and the substantial unmet need, this level of uncertainty is acceptable in this instance.”

Amylyx says that there are about 29,000 people living with A.L.S. in the United States and at least 200,000 people with the disease worldwide.

On a related note, the Office of Inspector General at the Department of Health and Human Services said this week that the F.D.A.’s accelerated approval process for drugs raised some concerns.

In a study of the agency’s accelerated approvals, the HHS watchdog found that 34% have at least one confirmatory trial past its planned completion date and four of the 278 drugs granted accelerated approval are five years or more past their original completion dates.

“The accelerated approval pathway holds promise for patients who face serious illnesses where adequate treatments are lacking,” the watchdog report said. “However, for a variety of reasons, sponsors do not always complete trials promptly. This can result in drugs staying on the market-and being administered to patients-for years without the predicted clinical benefit being verified. And insurers-including Medicare and Medicaid-paying billions for treatments that are not verified to have clinical benefit.”

The Office of Inspector General estimated that Medicare and Medicaid spent more than $18 billion from 2018 to 2021 on drugs that had been granted accelerated approval but still had incomplete confirmatory trials past their original completion dates.

Read more about the F.D.A approval process at Kaiser Health News.

Fed’s Favored Inflation Measure Still Running Hot

The Federal Reserve’s preferred measure of inflation recorded a larger-than-expected increase in August.

The personal consumption expenditures (PCE) price index rose by 0.3% compared to the month before, the Bureau of Economic Analysis announced Friday. Relative to 12 months ago, the index is up 6.2% — above expectations and much higher than the 2% target defined by the Fed.

Core PCE, which ignores volatile food and fuel components, was up 0.6% on a monthly basis and up 4.9% on an annual basis. Both numbers show an acceleration in the rate relative to July.

“The Fed will likely press forward with a stiff sequence of rate hikes given unacceptably high inflation readings, even if it means hiking into a slowing economy,” economists Andrew Husby and Eliza Winger told Bloomberg. “The revised real spending trajectory raises downside risks for 3Q GDP growth.”


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