A bill to implement two recommendations of the Grace Commission regarding Federal health care, and for other purposes.

Federal Health Care Cost Cutting Act of 1985 - Directs the Secretary of Defense and the Administrator of Veterans Affairs to report to the Congress concerning actions taken to implement the recommendations of the September 1, 1982, GAO report entitled "Millions Can Be Saved Through Better Energy Management in Federal Hospitals." Amends part B (Peer Review of the Utilization and Quality of Health Care Services) of title XI and titles XVIII (Medicare) and XIX (Medicaid) of the Social Security Act to require second opinions with respect to elective surgery procedures.