In his first major tests as Senate Finance chairman, Ron Wyden is waging war against the congressional penchant for patches and punting. It's not proving to be an easy fight.
The Oregon Democrat is pushing his colleagues to enact a permanent overhaul of the "sustainable growth rate" formula that requires cuts in doctor pay under Medicare — and on March 31 he plans to unveil a permanent, bipartisan tax extender package, eschewing the yearly fixes that have long been the norm.
"This is the time to do it," Wyden said of putting a permanent end to the annual "doc fix" debate. He cited recent estimates from the Congressional Budget Office that stated replacing the cuts would be relatively inexpensive compared to recent years.
“The reality is no one is going to want to deal with this again in a year. ... We've got this in terms of the price as good as we're going to get,” Wyden said. “It's going to cost more [later], and you're still going to have the same challenges.”
Wyden is also pushing to make permanent a series of about 50 tax breaks that expired at the end of last year, which he hopes will start a tax policy rewrite. While the breaks are technically temporary, they are typically renewed every year.
Wyden said he wants “people [to] see that this is a springboard to broader tax form. This is not just re-upping everything.”
He said he is pleased with discussions so far and said Finance ranking member Orrin G. Hatch, R-Utah, “has been very constructive.”
“We both feel strongly about this being the last extenders,” Wyden said. “I’ve got nine years of sweat equity in tax reform.”
Hatch last week said negotiators were discussing nixing 20 tax cuts, which amounted to about 10 percent of the total cost of the package. But a GOP committee aide subsequently stressed no final decisions had been made.
Wyden may have better luck with the tax extenders package than he has with the doc fix. Leaders in both chambers cut a one-year deal when it was clear Wyden's plan to pay for a permanent fix with war savings many deficit hawks consider to be gimmickry didn't have GOP support.
Senate Majority Leader Harry Reid, D-Nev., worked with Speaker John A. Boehner, R-Ohio, on the one-year “doc fix" that the House passed in by voice vote on Thursday .
If Congress fails to act, doctors would see a 24 percent cut in Medicare reimbursements starting April 1.
Wyden denied Reid's deal undercut his efforts.
“Sen. Reid has consistently said that he wants full repeal and replace, that is his first choice,” Wyden said. “What we are doing is working with him and Republicans to try to set in place what seniors and doctors need, which is [axing] Medicare make-believe. That’s what this is.”
Reid said as much Thursday night on the Senate floor, when he announced plans for the chamber to vote on the temporary patch Monday evening.
“I support repealing the payment system, the SGR, permanently,” Reid said. “I’ve been in favor of that for a long, long time and I appreciate the work done on this the past period of time that Sen. Wyden has been chairman of that committee.”
Reid added that he supports using war savings to pay for the SGR repeal, as Wyden has proposed, but acknowledged that there aren’t enough votes for the proposal.
“I repeat, the work done on it for the year didn’t have a way to pay for it,” Reid said. “[But] I support repealing this system permanently. I believe we should repeal it without pay-fors, or by using reductions in the Overseas Contingency Fund, called OCO.”
Hatch praised Reid for pushing for a temporary patch that gives more time to find a bipartisan offset.
“Ron works very hard, I have a lot of respect for him,” Hatch said, adding, “I think Sen. Reid has done the right thing.”
Wyden “wanted to solve it with OCO funds and to most of us that wasn’t the way to go,” Hatch said. “There aren’t any funds there, that’s the problem, it’s just phony. This gives us some time to work in a bipartisan, bilateral way to come up with the solutions that really are needed to make it permanent.”
Wyden said he plans to keep pushing.
"These are cuts that are not going to be made," Wyden said. "There have been 16 patches in the past. In Washington, D.C., people don’t do much when the emperor goes by with no clothes. SGR is the emperor has no clothes and people look and say 'Hey, nice suit, emperor.' "