The 21st Century Cures Act is a transformative approach to health reform that seeks better, faster, safer, and more innovative approaches to treat diseases and medical conditions that currently lack effective therapies. Not only will this bill help save and improve lives, streamline and modernize regulations, and keep good jobs here in the United States, it will also save money by developing cures rather than continuing to shoulder the heavy cost of chronic illness, so much of which is borne by taxpayers.
The legislation takes an innovative approach by establishing a temporary Innovation Fund that is fully offset and retains the critical role of the Appropriations Committee to determine the specific biomedical spending priorities through the regular appropriations process each year of its five-year life. Moreover, while the 21st Century Cures Act includes five years of targeted, offset investments in health research and innovation, the bill also includes permanent entitlement changes that will yield billions in savings within CBO’s scoring window.
These entitlement changes will lead to billions in additional savings in Medicare and Medicaid in the second decade and beyond – real savings that are not quantified by CBO, but will help stabilize and strengthen our long-term fiscal outlook. According to CBO, the bill will reduce the deficit by more than $500 million over the first decade. A conservative estimate calculated by Energy and Commerce staff indicates the permanent entitlement reforms in 21st Century Cures will cut federal spending an additional $7 billion in the second decade.
While the Innovation Fund is technically characterized by CBO as mandatory spending, it’s important to understand the difference between the Innovation Fund and the typical mandatory spending that occurs through many of the nation’s entitlement programs.