President Biden's FY 2022 Budget and Revenue Proposals
June 2021
President Biden's FY 2022 Budget and Revenue Proposals

By: Julius W. Hobson, Jr.

On May 28, President Biden released his FY 2022 budget and revenue proposals.

Health Care Budget Proposals

  • Health Care spending would increase 23%
  • Health & Human Services: $133.7 billion [+$25.1 billion/+23.1%]
  • NIH: $52.0 billion [+$9 billion]
    • Establish Advanced Research Projects Agency for Health (ARPA-H) to continue support for research that enhances health: $6.5 billion; ARPA-H is intended to “drive transformational health research innovation and speed medical breakthroughs by tackling ambitious challenges requiring large-scale, sustained, and cross-sector coordination”
    • National Institute of Diabetes and Digestive and Kidney Diseases: $2,219 billion [+$8.7 billion]
  • Centers for Disease Control & Prevention: $8.7 billion [+$1.6 billion]
  • National Health Service Corps: $185 million [+$65 million]
  • Doubles funding for the Community Mental Health Services Block Grant
  • Promotes health equity by addressing racial disparities
  • Addresses public health epidemic of gun violence
  • Expand access to Family Planning Healthcare Services: $340 million [+$340 million/+18.7%]
  • Rural health care access and expands the pipeline of rural healthcare providers
  • Expand educational programs for nursing, allied health and skilled health care workers
  • Investments in maternal health

The President’s FY 2022 budget proposal does not directly address certain health-care policies:

  • Lower drug costs by letting Medicare negotiate prices
  • Create a public health care option
  • Lower the Medicare eligibility age to 60
  • Close the Medicaid “coverage gap” in states that didn’t expand the program

Meanwhile, some U.S. House of Representatives progressive Democrats are drafting their own public health care option. The chances of such legislation appear slim as not all House Democrats support the concept. With just 219 Democrats, the loss of just a handful makes any proposal unlikely to succeed. The Democrat won the June 1 special election in New Mexico for the First Congressional District, which will take the House Democratic membership to 220 before the end of the month. Finally, the House will begin work on the 11 appropriations bills when it returns from the current recess on June 14.

Revenue Proposals

  • $3.6 trillion increased revenue over 10 years
  • Raise the Corporate Income Tax Rate from 21% to 28%
    • The President has signaled his willingness to drop this proposal in return for a 15% minimum tax on corporations
  • Extend expanded ACA premiums tax credits in the American Rescue Plan
  • Increase the Top Marginal Income Tax Rate for High Earners from 37% to 39.6% for taxable income over $509,300 for married individuals filing a joint return, $452,700 for unmarried individuals, $481,000 for head of household filers, and $254,650 for married individuals filing a separate return
  • Extend Child Tax Credit increases in the American Rescue Plan through 2025 and make the Child Tax Credit permanently fully refundable
  • Permanently increase tax credits to support families with child care needs
  • Make the Earned Income Tax Credit expansion for childless workers permanent
  • Give IRS authority to regulate paid tax preparers
  • Revitalize enforcement to make the wealthy pay what they owe
  • End capital income tax breaks and other loopholes for the very top earners

The president’s proposal to increase the top corporate rate to 28% appears doomed. Senator Joe Manchin [D-WV] has expressed his opposition and instead supports a 25% top rate. Negotiations between the President and Senate Republicans on the infrastructure package could result in an altered revenue package.