Senate Dems will keep pushing for Medicaid aid to ailing states

Emergency Medicaid funding will remain a part of the
Senate’s failed tax package, a key Senate Democrat insisted on Friday.

Some Democrats have weighed the possibility of separating
the Medicaid provision — which would extend emergency federal funding through
the first half of 2011 — in hopes of passing it more quickly and preventing
severe budget cuts by cash-strapped states, which will begin as early as this

{mosads}But Sen. Debbie Stabenow (D-Mich.) said Friday that that’s
not the Democrats’ plan.

“That’s part of the [tax] bill,” Stabenow told reporters on
a phone call. “It’s in there because we’re committed to keeping it in there.”

Stabenow said that, if a deal is struck, the package could
hit the floor at any time. But until then, it will remain just that: a package.

“At any time we could bring this back for a vote,” said
Stabenow, a member of the Finance Committee. “We could pass it in five

The 2009 economic stimulus bill included $87 billion in
Medicaid funding to help states weather the recession. The funds expire at the
end of 2010, leading Democrats to propose a six-month extension — time enough
to see the states through the 2011 budget year. The initial proposal would have
increased Medicaid’s Federal Medical Assistance Percentage (FMAP) by 6.2
percent over that span.

That proposal has ran into a buzz saw in the Senate, where
Republicans objected to the pricetag. The impasse prompted Democratic leaders
to scale back the extra Medicaid funding from $24 billion to $15 billion. It
was killed Thursday along with the rest of the tax extenders bill, when a
procedural motion failed on arguments that the overall package would add to the

Michael Leachman, senior policy analyst at the Center for
Budget and Policy Priorities (CBPP), a liberal policy group, said that 22
states and the District of Columbia have already passed budgets presuming that
the additional six months of funding is forthcoming. If Congress doesn’t pass
the enhanced FMAP extension this month, he said, those states will likely begin
cutting other programs next month.

“Many of the cuts will start on July 1,” Leachman said.
“It’ll slow the economic recovery.”

Robert Blendon, health policy expert at Harvard University,
had a slightly different take, arguing that the immediacy of the state cuts
hinges on the likelihood of Congress approving the emergency funding before the
start of next year.

“If you’re absolutely sure they’ll pass it, as governor,
then you wouldn’t do anything,” Blendon said “But if there’s uncertainty,” he
added, states should start budgeting for the worst.

If the issue is partisan on Capitol Hill, it’s hardly so in
the states. In February, a long, bipartisan list of state governors urged
Congress to approve the additional six months of emergency funding, at the 6.2
percent rate.

“The length and depth of the recession means states and
territories will continue to face significant budget shortfalls long after the
enhanced FMAP provisions expire at the end of this calendar year,” wrote the
governors, representing 42 states and five U.S. territories.

Still, Democratic leaders couldn’t convince a single
Republican to back the extenders package, which would have added $33 billion to
the federal deficit. They also lost Democrat Ben Nelson (Neb.) in Thursday’s

The stalemate has caused Democrats to abandon the tax bill —
at least for the time being. A spokesperson for Senate Majority Leader Harry
Reid (D-Nev.) said Friday that the ball is in the Republicans’ court. “We
support it, and it’s paid for,” the aide said of the Medicaid funding. “But
we’re going to need Republican support.”

Stabenow said that lobbying from GOP governors might offer the
best chance for the Medicaid provision.

“What would be most helpful to us,” Stabenow said, “would be
to have the Republican governors talking to their Republican colleagues.”

Meanwhile, Sen. Sherrod Brown (D-Ohio) said Friday that he
would continue his push to attach an amendment to the tax package extending
federal subsidies for COBRA health benefits for the unemployed. The enrollment
deadline for the COBRA subsidy program, like that for unemployment benefits,
came and went on June 1. As a result, more than 144,000 families are expected
to lose out on those benefits each month, according to the National Employment
Law Project, an advocacy group.

A failure to extend the safety net programs while
unemployment rates are stick tickling 10 percent, Brown warned, would threaten
the fragile recovery.

“That just undoes the advantages — the positive side — of
the stimulus,” Brown said.

Tags Debbie Stabenow Sherrod Brown

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