House Speaker Mike Johnson recently introduced a crucial spending bill late Tuesday, aimed at preventing a potential government shutdown if it receives approval from both the House and Senate before funding resolutions expire this Saturday. This legislative effort, often referred to as a continuing resolution, has garnered bipartisan support and seeks to address pressing fiscal obligations for the government.
The spending plan will extend government funding until March 14, indicating another impending financial confrontation coinciding with the early days of the Trump administration. As Republicans are set to dominate both the Senate and the House starting in January, it’s important to note that they will be navigating through a slim majority in both chambers, adding complexity to the negotiations.
A significant aspect of this deal includes nearly $100 billion allocated for disaster relief. This substantial allocation aims to deliver almost $10 billion to support banking relief efforts for farmers in rural areas, as well as extending the farm bill for an additional year. Additionally, the legislation focuses on ensuring access to telehealth for more seniors while reforming the operations of pharmacy benefit managers (PBMs).
The spending bill comprehensively addresses a variety of fiscal needs. For instance, it incorporates close to $100 billion dedicated to assisting Americans recovering from various natural disasters that struck during 2023 and anticipated challenges in 2024. This aligns with President Biden’s request for similar funding, ensuring a coordinated federal response to disaster relief.
Among the notable allocations, approximately $29 billion is earmarked to replenish the Federal Emergency Management Agency’s (FEMA) Disaster Relief Fund, a financial reserve that has been strained following major hurricanes that impacted the Southeast earlier this year. This past October saw FEMA swiftly expend $9 billion of an earlier $20 billion grant from Congress in response to Hurricanes Helene and Milton. Indeed, federal data illustrates that catastrophic disasters are escalating in frequency, making this funding even more critical.
Furthermore, this spending package encompasses $2.2 billion for the Small Business Administration’s disaster loan program and $21 billion for disaster relief tailored specifically for farmers. Additionally, assistance for repairing water systems affected by disasters is also covered, tallying up to $3.5 billion, while the Department of Housing and Urban Development is designated $12 billion for disaster relief, alongside $8 billion for federal highway and road repairs.
One of the contentious points of negotiation involved the $10 billion in economic assistance allocated for farmers, essential for those grappling with declining commodity prices and rising supply costs. The bill also proposes a one-year extension of the farm bill, which governs a variety of agricultural and nutrition support programs. Typically, this legislation is renewed every five years, and with the last passage in 2018, the extension ensures continuity until September 2025.
In an important advance, the bill introduces several reforms targeting pharmacy benefit managers—key intermediaries between drug manufacturers and insurers. For two years, these reforms had been debated, and now, the legislation mandates that PBMs disclose more details about the rebates they negotiate and receive. Additionally, it will change how they are compensated, moving away from drug pricing linked compensation models to flat fees.
The funding package also requires the pharmaceutical sector to transparently pass along all rebates to healthcare plan sponsors, which encompasses insurers and employers. Additionally, “spread pricing” practices, where PBMs retain part of the payments meant for pharmacies, will be virtually eliminated, especially impacting Medicaid programs.
Industry advocates of PBMs argue that this legislative push could compromise their ability to negotiate lower drug prices, potentially leading to increased premiums for senior citizens. Following quite a stir in regulatory arenas, the Federal Trade Commission has charged several major PBMs, such as CVS Health’s Caremark Rx and Cigna’s Express Scripts, for alleged manipulation of insulin pricing.
A further extension in the agreement pertains to telehealth services, with a two-year extension allowing broader access for seniors and individuals with disabilities, a measure initially established during the pandemic. The goal is to facilitate care more conveniently, particularly for seniors who can now consult healthcare providers without traveling to facilities.
As for infrastructure developments, under the new agreement, complete funding for replacing Maryland’s Francis Scott Key Bridge, which tragically collapsed following a cargo ship collision that resulted in the fatality of six workers, is allocated for federal support. Estimates for reconstructing this vital bridge hover between $1.7 billion to $1.9 billion.
Moreover, the spending package paves the way for the Washington Commanders football team to potentially return to the district by increasing local governance over the land surrounding the now-defunct Robert F. Kennedy Stadium. Meanwhile, this package also means that lawmakers could finally receive their first pay increment since 2009, as leaders across party lines have agreed upon a cost-of-living adjustment.
In addition, the legislation touches on health care for Congress members, allowing them to exit Affordable Care Act coverage—an aspect that has stirred frustration among some GOP figures. Ultimately, this funding agreement represents a cumulative effort to bolster fiscal stability in various prioritized sectors while engaging in complex negotiations essential for a harmonized
