There Is A Season
Mar 22, 2017


The Trump administration released its proposed fiscal year 2018 budget this week. President Trump outlines significant cuts across virtually every major department and agency, with the exception of Defense, Homeland Security and Veterans Affairs. While the White House budget is an opening proposal, it does reflect the administration's list of priority spending and cutting. Congress may consider the President's draft as it constructs the actual federal budget. This week, we turn to several areas of the budget affecting our industry.





In the area of cybersecurity, the President's budget recommends a $61 million investment to help the FBI and the Justice Department combat criminals and terrorists' use of encrypted communication tools. The Department of Homeland Security echoed the President's broad plan to improve government security by holding top government officials accountable for breaches, improving the way federal agencies share cybersecurity services, and rallying support from the private sector to make the federal system safer.



The President called for a 21% decrease in funding to the Department of Labor. Part of the budget actually expands re-employment and eligibility assessments, which the Department characterized as a valuable activity that conserves unemployment insurance and encourages claimants to return to work. But among the major cuts, President Trump's budget calls for the elimination of the $434 million Senior Community Service Employment Program (SCSEP) and various block grants to OSHA for safety training.



In a move that somewhat belies the President's image as a building magnate, the administration's 2018 budget slices the Department of Transportation's budget by 13 percent, or $2.4 billion, which cuts or eliminates several key federal infrastructure programs. During the campaign, and in his first address to Congress, the President vowed to increase spending on roads, utilities and other vital facilities. President Trump's budget director said the White House will uphold its pledge for $1 trillion in new infrastructure spending through an unspecified "infrastructure package" to be released later the year. We'll turn back to the federal budget around the end of April when the Continuing Resolution to fund the government expires.



President Trump's budget made news because it does not include funding for increased marijuana enforcement. In fact, Attorney General Jeff Sessions told reporters this week that Obama-era guidance that paved the way for states to legalize marijuana remains valid. At the federal level we continue to see lawmakers, including a newly created "Cannabis Caucus", pressing forward with Congressional measures to further decriminalize the drug.



In Boston, lawmakers held legislative hearings on a measure to make the drug legal for recreational use. And in San Diego, law enforcement officials announced new initiative to use swabs and portable testing machines to detect the increasing number of California drivers who are on drugs. A study by the state's Office of Traffic Safety found that 38 percent (up 6% over the prior year) of drivers killed in car crashes in California in 2014 tested positive for drugs, legal or illegal.

Making Our Way Around The Country


Supreme Court nominee Gorsuch began his bid for Senate confirmation this week. Judge Gorsuch will face lengthy questioning from 20 Republican and Democrat members of the Senate Judiciary Committee. We're following the marathon examination, in large part to track the make-up of the nation's High Court, but in no small part to see whether the Judiciary staff members order late night robot take-out on Capitol Hill.



The Iowa House of Representatives debated and approved workers' compensation reform, sending amended House File 518 to the state Senate. Two original provisions that would have ended benefits at age 67 and raised the standard for some injuries covered under the workers' compensation program were removed during the House debate. The bill does address an Iowa ruling that allows injured workers receiving workers' comp benefits to also collect unemployment insurance. The bill also requires that intoxicated injured workers must show the injury was not the result of intoxication before claiming benefits.



Claim payment issues involving the cost of air ambulance services continue to make news, particularly in the vast landscape of Big Sky Country. Against the backdrop of Bozeman Yellowstone International Airport, Sen. Jon Tester (D-MT) introduced legislation that "very narrowly" carves air ambulances out of the federal law created for commercial airliners. According to Senator Tester, S. 471 would allow states the right to regulate these air ambulance services. This week, the National Conference of Insurance Legislators (NCOIL) announced the formation of an Air Ambulance Medical Billing Task Force. The task force will meet in person at NCOIL's summer meeting here in Chicago.



The House Insurance and Banking Subcommittee voted to advance its 34-page workers' compensation reform bill. The subcommittee vigorously debated the attorney fees components of the bill, which would allow judges of compensation claims to approve fees up to $250 an hour for workers' attorneys. We're watching this bill and other brewing storms involving attorney fees in the Sunshine State's flood insurance program.



Spring arrived this week, or so they tell us in the Windy City. At The Way, we can usually mark the seasonal turn by the degree to which our purple and green brackets are categorically busted. At least we're not alone this year. So for all but 16 schools and their fans, this week marks the start of spring break season. Need some ideas? We suggest a great National Park road trip or some warm weather spring trainingbaseball. Enjoy the break and travel safely!

About The Way

The Way is Gallagher Bassett's weekly governmental briefing on state and federal affairs that affect our industry. We thank you for starting your Wednesday morning with us. Please be sure to follow #GBTheWay for additional news and updates as we make our way throughout the country on the issues affecting our industry. For more information, please connect with GB on LinkedIn, follow us on Twitter, or contact the authors, Greg McKenna or Cari Miller, directly.


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