SENATE. The Senate convened this morning and is scheduled to consider a motion at 4:30 p.m. to limit debate on the nomination of Samuel Alito to the U.S. Supreme Court. If cloture is invoked, a confirmation vote will be scheduled for tomorrow.  Other agenda items on the Senate schedule this week include consideration of a short-term extension of the Patriot Act which expires on February 3, and a motion to proceed to conference on the tax reconciliation package.  

HOUSE.  The House will return tomorrow, January 31, for the second session of the 109th Congress.  Members will start off the year with a final vote on the conference report to the budget reconciliation bill.  Before adjourning for the holiday recess, the Senate made minor changes to the bill and it must go back to the House for a final vote.  CBO scored the package last week, finding savings of $38.8 billion over five years.  The chamber will then consider a lobbying reform resolution that would bar former members who are registered lobbyists from being on the House floor and using the House gym.   Finally, the chamber will consider a measure to extend the Patriot Act.

House Democrats will elect a new vice chairman of the Democratic Caucus and the House Republican conference is scheduled to elect a new majority leader as well as a chair of the Republican Policy Committee; moves that could potentially lead to votes for other leadership posts.

OTHER EVENTS.  The President will address a joint session of Congress tomorrow evening at 9:00 PM (EST) for the State of the Union Address where he is expected to push a number of health care and energy proposals, discuss national security, provide a renewed defense of the war in Iraq, and his decision to order domestic electronic surveillance.  The President will also focus on economic competitiveness and education. 

PRESIDENT'S 2007 BUDGET PROPOSAL

The President will release his FY 2007 budget proposal on Monday, February 6.  It is anticipated that it will contain non-defense, non-homeland security funding cuts, similar to his FY 2006 proposal.  The President will outline proposals to address healthcare concerns, plans to improve science, education and research while holding  the line on non-security domestic discretionary spending.  Money saving changes to mandatory spending programs such as Medicare will also be proposed. The Homeland Security Department's budget may get a 5% boost in the President's proposal, one of the few departments to get an increase with substantial increases for border security, science and technology. 

DEPARTMENT OF HEALTH & HUMAN SERVICES TO ADDRESS DUAL ELIGIBLE DRUG COSTS THROUGH WAIVER

Last week the Administration announced that the U.S. Department of Health and Human Services (HHS) will reimburse states for any Medicare Part D prescription drugs costs for dual eligibles (those eligible for both Medicare and Medicaid) not otherwise reimbursable by Part D drug plans.  The funding for states will be provided through a waiver program that will be administered under a Section in MMA that would allow for demonstration program authority.  The waiver program will reimburse states for the full cost of state expenses for providing temporary Part D coverage, including:

1) ensuring payment reconciliation with the Part D drug plans;

2) Medicare payment for any gap between what a plan reimburses and actual expenses states incurred in Medicaid; and

3) some funding for state administrative costs.

The waiver will be retroactive to the first day each state began making payments under Part D.