The Federal Jigsaw Puzzle 


Situation Report | September 27, 2021

Congress returns this week with several must-pass pieces of legislation, including the raising of the debt ceiling and a continuing resolution to keep the federal government running. Democrats are still committed to passing a reconciliation package. However, there are several moving parts that are going to dictate bringing each of these to the floor.

The House has passed a comprehensive piece of legislation that would fund the government through the end of 2021, as well as raise the debt ceiling along party lines. As well, the House has begun work on a reconciliation package of about $3.5 trillion. In the Senate, Republican Leader Mitch McConnell has said that Republicans will not support reconciliation or raising the debt ceiling and would only support a clean continuing resolution to keep the government funded.

The path forward will most likely be to pass a stand-alone continuing resolution that would garner bi-partisan support to fund the government. It would then be incumbent upon Democrats to raise the debt ceiling through reconciliation. The problem is that Democrats are not aligned on how, or if there even should be, a reconciliation package.

Several Democrats in the Senate and the House have made it clear they will not support a $3.5 trillion reconciliation package and again, it is clear that no Republicans will support any kind of reconciliation package, so it is incumbent upon Democrats to agree to garner passage. If there is no agreement on reconciliation, the debt ceiling will then be at issue.

Reconciliation is the only vehicle Democrats have to raise the debt ceiling without Republican support. If Democrats cannot come to an agreement before the deadline to raise the debt ceiling, sometime at the end of October, then there will be a showdown in the Senate to see if Republicans will change their position on debt ceiling, otherwise the United States will default on its debt obligations.

Better Care Better Jobs Act 

While this puzzle is being worked on, the House has included $190 billion towards funding of the Better Care Better Jobs act, most of which would come through an increase in FMAP funding. This amount is based on an overall funding level of $3.5 trillion. Again, it is anticipated that reconciliation will be much smaller in the Senate so it is expected that the funding for Better Care Better Jobs Act will be lower in any Senate version that is passed. We will continue to monitor what funding is included and how it will affect the home care industry.