Senate pushes enhanced Medicaid payments to states

A six-month extension of enhanced federal funding to help states pay their Medicaid bills is back in play. The $24 billion provision is part of the substitute to the tax extenders bill the Senate Finance Committee unveiled Tuesday.

The extension of enhanced payments past Dec. 31 was taken out of the tax extenders bill that the House passed before the Memorial Day recess after Blue Dogs and others balked at its price tag, which wasn’t offset through higher taxes or cuts to other programs.

But state officials and patient advocates have continued to pressure lawmakers to extend the enhanced payments through June, so cash-strapped states won’t have to make drastic cuts to their Medicaid and other programs.

Missing in the Senate substitute, however, are $8 billion worth of COBRA health insurance subsidies for laid-off workers — also cut from the House bill.

“I’d prefer personally to have COBRA in,” Sen. Charles Schumer (D-N.Y.) said at a press conference announcing the new Senate version. “But we’re dealing with [the need to balance job creation and deficit reduction].”

Sen. Bob Casey Jr. (D-Penn.) is scheduled to defend the need for COBRA aid during a conference call Wednesday with jobs experts from Families USA and the National Employment Law Project.

Pharmacy groups said in a letter sent Tuesday to the Senate Democratic and Republican leadership that the cuts would hurt a still-fragile economic recovery.

“Without action by Congress, states will likely be forced to make further cuts to Medicaid and other programs, which could reduce access to critical healthcare products and services including prescription medications and related pharmacist services, as well as increased taxes to meet their balanced budget requirements,” says the letter. “These actions will create a further drag on the economy and may result in additional job loss.”

The letter was signed by the American Pharmacists Association; the Food Marketing Institute; the National Association of Chain Drug Stores; the National Alliance of State Pharmacy Associations; and the National Community Pharmacists Association.