Proposal To Reduce Medicaid, Medicare Spending ‘Three or Four’ Votes Short, Grassley Says
Senate Finance Committee Chair Chuck Grassley (R-Iowa) on Tuesday said he is about "three or four votes" short of the total needed to approve a plan that would cut Medicaid and Medicare spending as part of the fiscal year 2006 budget reconciliation process, CQ HealthBeat reports (CQ HealthBeat, 10/18). The proposal could include about $12 billion in cuts to Medicaid and Medicare, in addition to a Medicaid expansion for Hurricane Katrina survivors (California Healthline, 10/18).
The plan has been "changing rapidly" as Grassley has tried to gain votes, and the senator said he was meeting with committee members individually to discuss their concerns about the plan, CQ HealthBeat reports.
Changes to the package as of Tuesday night included a "dramatically scaled-back" version of Grassley's proposal to extend Medicaid coverage to Katrina survivors, CQ HealthBeat reports. Sen. Trent Lott (R-Miss.) said the altered proposal would cost $1.8 billion; provide full Medicaid funding for Louisiana, Mississippi and parts of Alabama to cover the costs of providing health care services to evacuees; and provide funding to hurricane survivors who have settled in other states.
In addition, the modified reconciliation package might include:
- An increase in Medicare payments to physicians -- some lobbyists estimated a 1% increase in FY 2006 -- instead of no payment update for one year;
- A version of legislation (S 183) that would allow families with incomes up to 300% of the poverty level to purchase Medicaid coverage for disabled children;
- A compromise on Medicaid asset transfer rules; and
- A freeze in the scheduled implementation of a plan that would restrict eligibility for inpatient rehabilitation facility payments by specifying that a set percentage of patients must have certain medical conditions, also known as the "75% rule."
As of Tuesday, it was "unclear" whether Sens. Gordon Smith (R-Ore.) and Olympia Snowe (R-Maine), two Republican moderates on the committee, supported Grassley's plan, CQ HealthBeat reports.
Lott and Sen. Craig Thomas (R-Wyo.) said they likely will support the package. Thomas said he is not happy with the measure but added, "I'm going to work with (Grassley) if I need to because we need to get something done." Grassley said he is unsure when his committee will mark up the reconciliation package.
Arkansas Gov. Mike Huckabee (R), chair of the National Governors Association, and Arizona Gov. Janet Napolitano (D), NGA vice chair, on Tuesday in a letter to Grassley said lawmakers should provide full Medicaid funding for Hurricane Katrina survivors. "Should reconciliation move forward, governors continue to support their recommended Medicaid flexibilities but oppose reform proposals that simply shift costs from the federal government to states," they wrote.
The letter also was sent to finance committee ranking member Max Baucus (D-Mont.), Senate Majority Leader Bill Frist (R-Tenn.) and Senate Minority Leader Harry Reid (D-Nev.) (CQ HealthBeat, 10/18).
The federal government's response to Hurricane Katrina seems "to be driven more by laissez-faire ideology than by need or common sense," Washington Post columnist Harold Meyerson writes, pointing out, for example, that the Bush administration has opposed Grassley's Medicaid relief plan. Meyerson adds that "Republicans' post-Katrina priorities and those of the American public couldn't be more diametrically opposed," with 67% of people polled in a recent Peter Hart survey saying it is "wrong" to cut Medicaid and other social programs by $35 billion and cut taxes by $70 billion.
Some lawmakers initially considered an across-the-board spending cut, but because that "would have meant less money for defense contractors and ... other contributors to congressional Republicans' campaigns," Republicans instead are considering the Medicaid reductions, Meyerson says. He writes, "The beauty of taking the cuts out of Medicaid ... is that it doesn't reduce the flow of funds to the Republican campaign committees by a single dime" (Meyerson, Washington Post, 10/19).