January 6, 2006

Budget Reconciliation Package Contains Medicaid and Medicare Provisions Affecting Drug and Device Manufacturers

Arnold & Porter Advisory

On December 21, 2005 the Senate passed a budget reconciliation bill by 51–50, with Vice President Cheney casting the tie-breaking vote. The Senate approved the bill after failing to waive the rules regarding extraneous matters in reconciliation bills ("Byrd Rule"). Sen. Conrad (D-ND) raised points of orders against three provisions in the House-passed conference report, effectively killing the conference report. (One provision limited providers’ liability if they denied non-emergency care to Medicaid beneficiaries who could not make copayments; the other two were described as technical provisions concerning Medicare-related reports.) The Senate then passed a substitute amendment that deleted the offending provisions and made at least one additional change, described below in this advisory. The House is expected to take up the measure shortly after returning from recess January 31st. Once enacted, the bill will be called the Deficit Reduction Act of 2005.

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