WASHINGTON – The Senate on Thursday approved the fiscal year 2006 appropriations bill for HHS and the departments of Labor and Education, providing $42.5 million in funding for the Office of the National Coordinator for Health Information Technology and healthcare IT projects, less than the $75 million requested in the White House's budget.

Senators Debbie Stabenow (D-Mich.) and Olympia Snowe (R-Maine) proposed an amendment that would have provided $75 million to match the House version of the spending bill for healthcare IT projects. But the amendment was never brought to a vote. The bill (H.R. 3010) now moves to a conference committee to resolve the House and Senate versions of the bill.

Some healthcare IT advocates plan to lobby lawmakers in the coming weeks to provide the $75 million. The Healthcare Information and Management Systems Society, the eHealth Initiative and IT vendors such as IBM and Intel are among a group that plans to run an ad in Roll Call, a newspaper widely read on Capitol Hill, calling for Congress to fully fund IT projects in this year's budget.

Dave Roberts, director of public policy for the Healthcare Information and Management Systems Society, noted that the $42.5 million is $10 million more than was allocated in 2005. Still, he predicted that full funding could be difficult in a tight fiscal year. If that happens, it could send a negative signal about the importance of healthcare IT, said Scott Wallace, president of the National Alliance for Health Information Technology.

"It's relatively minor amount of money and it's critically needed," Wallace said.

Rep. Johnson introduces HIT legislation

Meanwhile in the House, Rep. Nancy Johnson (R-Conn.) on Thursday introduced a bill with Commerce Health Subcommittee Chair Nathan Deal (R-Ga.) that calls for HHS to recommend a single federal privacy standard, removes barriers to healthcare providers donating technology tools to physicians, codifies ONCHIT to make it a permanent office and provides for the certification of IT tools to meet interoperability standards. In addition, the bill (H.R. 4157) calls for updates to a diagnosis coding system and requires HHS within two years to report to Congress on its progress in implementing a nationwide healthcare IT infrastructure.

Many of the bill's provisions address initiatives already under way within the government. The bill also contains recommendations similar to a report released this week from the Commission for Systemic Interoperability, led by Scott Wallace. Among other things, the 11-member federal advisory body called for a national privacy law and reforms to Stark and Anti-kickback laws that prevent hospitals and others in the healthcare industry from sharing IT tools with doctors.

Dan Rode, vice president of policy and government relations for the American Health Information Management Association, predicted that the bill could have a better chance of passing than other healthcare IT bills before Congress because it doesn't have specific funding attached to the bill. "We see it as something that the sooner its passed, the quicker we'll be able to resolve some of the significant issues and get the standards updated," he said.

Rep. Tim Murphy (R-Pa.) on Thursday night slipped in a proposal into a fiscal year 2006 budget reconciliation package to provide $100 million in Medicaid "transformation grants" for doctors and hospitals to use IT as a way to reduce healthcare costs and medical errors. The House Energy and Commerce Committee approved the reconciliation package, which would cut Medicaid spending by close to $9.5 billion during a five-year period. Murphy had earlier introduced the plan as part of another bill (H.R. 4142). The bill now heads to the House Budget Committee.