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Congress Passes Year-End Spending Bill

Six-Month Moratorium Imposed on Medicaid Rehabilitation Rules

December 20, 2007

The House and Senate have given final approval to a $555 billion year-end omnibus spending bill that includes FY 2008 funding for non-defense discretionary spending, including vital mental illness services and research funding.  The measure (HR 2764) cleared the House Wednesday by a vote of 272-142, after passing the Senate 76-17 on December 18 (with the Senate adding in supplemental funding for Iraq demanded by the President).  President Bush has pledged to sign the bill into law.

This ends months of division between the White House and Congress over domestic spending levels.  In the end, congressional leaders abandoned efforts to add $22 billion for domestic priorities, and instead followed the President’s overall spending levels.  In order to stay under the President’s overall ceiling on discretionary spending, many programs and agencies were held at current FY 2007 levels.  In addition, a final 1.747% across the board reduction was added to the spending package.

SCHIP-Medicare-Medicaid Package

In addition to the omnibus FY 2008 spending bill, the House and Senate have also cleared a package of short-term changes to Medicare, Medicaid and the State Children’s Health Insurance Program (SCHIP).  President Bush is expected to sign this bill despite initial objections.  Critical among the short term changes is a 6-month moratorium on proposed rules curbing the ability of states to use the Medicaid Rehabilitation Option to fund important mental illness treatment and supports.  NAMI strongly supports this moratorium.    Details of the SCHIP-Medicare-Medicaid package.

Mental Illness Research and Services Funding

The 1.747% across-the-board reduction in the final omnibus package all but eliminates the $26 million increase that the NIMH was due to receive for FY 2008.  At the Substance Abuse and Mental Health Services Administration (SAMHSA), the across-the-board cut will leave most programs below their FY 2007 level.   Details on mental illness research and services funding. 


The omnibus package includes a $3.7 billion increase in veterans medical care funding that will be released if the President designates these additional funds as emergency spending.  This increase in funding for veterans medical care will NOT be subject to an across-the-board reduction.   Details on veterans funding


The omnibus spending bill includes restoration of the HUD Section 811 program back to $237 million, as well the full $1.586 billion request for the McKinney-Vento Homeless Assistance Act. It also includes $75 million in new funding for rent subsidies under the “VASH” program for homeless veterans living with mental illness and co-occurring substance abuse disorders and $30 million in new funding for rental vouchers for non-elderly people with disabilities.  As with all other federal agencies, all of these programs are subject to the 1.747% across-the-board cut.    Details on housing funding