The Senate next week could consider the “Trade Promotion Authority” bill, which partly would pay for the cost of extending the Trade Adjustment Assistance (TAA) program by imposing additional sequestration cuts on Medicare.

TAA is a program that, among other things, provides tax credits for the purchase of health insurance to people who lose their health coverage as a result of global trade agreements.

The Senate Finance and House Ways and Means committees last week voted to clear the legislation for floor consideration, despite a call from the AHA, the American Medical Association, the American Health Care Association, and the National Association for Home Care & Hospice to drop the Medicare cuts from the measure.

“Our understanding is that the bill would extend the sequester on Medicare for the last six months in 2024 and increase the amount cut by the sequester by $700 million,” the groups wrote in an April 21 letter to House and Senate lawmakers. “Hospitals, physicians, nursing homes and home health and hospice providers have already absorbed hundreds of billions of dollars in cuts to the Medicare program in recent years," they noted.. “Additionally alarming is the use of Medicare cuts to pay for non-Medicare related legislation, a precedent that we believe is unwise.”

The AHA and eight other national hospital organizations also sent a similar letter to members of Congress. The hospital groups said “hospitals are already facing more than $121 billion in cuts imposed since 2010, and are projected to experience this year the lowest Medicare margin – negative 9% – ever recorded.” 

Originally, the automatic 2% annual Medicare reductions imposed by the 201l Budget Control Act were slated to end after fiscal year (FY) 2021. But lawmakers in 2013 agreed to continue the reductions for an additional two years, until FY 2023, and then last year pushed the sequestration into FY 2024 to help pay for other legislation.

The Trade Promotion Authority bill would give the White House “fast track” authority to negotiate a 12-nation Pacific trade accord. The Trans-Pacific Partnership would be the most significant trade deal since the North American Free Trade Agreement of 1993, linking nations representing 40% of the world’s economic output.