Senate Budget Committee Approves Budget Resolution; Moves to Full Senate

The Senate Budget Committee on Thursday passed a fiscal year 2006 budget resolution along party lines with "no substantive amendments," the New York Times reports (Stolberg/Kirkpatrick, New York Times, 3/11). The 12-10 vote will send the $2.56 trillion budget to the full Senate, which is expected to pass the legislation next week, CongressDaily reports (Cohn, CongressDaily, 3/11).

The Senate budget proposes $32 billion in cuts over five years for mandatory spending programs, including Medicaid, which would be similar to cuts proposed by President Bush. In his FY 2006 budget plan, Bush proposed revisions to Medicaid that he estimated would save $60 billion over 10 years and $14 billion over five years. The Congressional Budget Office projected that Bush's plan would reduce Medicaid spending by $9 billion over five years.

Under the Senate proposal, the Senate Finance Committee, which has authority over Medicare and Medicaid, would be tasked with finding cuts totaling about $14 billion. The Senate Health, Education, Labor and Pensions Committee would be responsible for making $8.6 billion in cuts.

Senate Budget Committee Chair Judd Gregg (R-N.H.) has said his budget proposal "is not a radical departure and won't even significantly change the glidepath" or affect services of mandatory spending programs (California Healthline, 3/10). Congressional leaders hope to finish Senate debate on the budget before lawmakers begin their two-week recess March 18. The House also is set to begin debate next week (Schatz/Allen, CQ Today, 3/10).

The House Budget Committee on Wednesday voted 22-15 to approve its fiscal year 2006 budget resolution, which calls for $69 billion in cuts over five years to mandatory spending programs, including Medicare and Medicaid, about $18 billion more than President Bush requested in his budget proposal (American Health Line, 3/10).

Two reports released Thursday by the Center on Budget and Policy Priorities say the House and Senate budget resolutions would "likely lead to additional and larger reductions in Medicaid" and "increas[e] the ranks of the uninsured and the underinsured" (CQ HealthBeat [1], 3/10).

Sens. Jon Corzine (D-N.J.) and Ron Wyden (D-Ore.) on Thursday unsuccessfully proposed an amendment to the budget resolution that sought to prevent the Medicaid spending reductions that Gregg is seeking. According to CongressDaily, the Democrats' proposal "might augur other, tougher amendments," as there is "broad bipartisan concern about proposed Medicaid cuts" (CongressDaily, 3/11).

The Senate Budget Committee on Thursday did agree to adopt nonbinding language offered by Corzine that the budget should not "cap federal Medicaid spending or otherwise shift Medicaid cost burdens to state and local governments." Gregg said the resolution is "a benign agreement," but Corzine indicated he thought the committee had given him "moral backing" to raise the Medicaid issue in debates.

Sen. Gordon Smith (R-Ore.) said he plans to call for a bipartisan commission to study Medicaid's finances and propose a cost-cutting measure. Gregg called the budget's proposed Medicaid cuts "a marginal rate of restraint, almost a nonfactor" that would affect 1% of the program's expected $1.11 trillion cost after five years. However, he said, "There are interest groups around here that wish to earn their keep so they have to hyperbolize issues" (New York Times, 3/11).

Wyden said Democrats would focus their efforts on the proposed Medicaid cuts. "I would expect there will be further efforts made on the floor to protect the poor who rely on Medicaid," Wyden said (CQ Today, 3/10). However, Senate Finance Committee Chair Chuck Grassley (R-Iowa) on Thursday said, "I believe the votes [for the Medicaid cuts] will be there on the committee and even on the floor" (CQ HealthBeat [1], 3/10).

According to the Times, Medicaid cuts also are "drawing opposition from some Senate Republicans, who are caught between their desire to support the president and pressure from home-state governors resisting the cuts" (New York Times, 3/11). Elizabeth Wenk, a spokesperson for Rep. Michael Castle (R-Del.), said the proposed cuts to Medicaid "have caused particular anxiety in the moderate wing of the party," CQ Today reports (CQ Today, 3/10).

The Senate Budget Committee also adopted by voice vote an amendment that would add a reserve fund to the budget to pay for possible legislation -- if enacted this year -- that would legalize the importation of prescription drugs. The amendment notes the reimportation fund could only be used to facilitate the sale of drugs from "specified countries with strong safety laws" (CQ HealthBeat [2], 3/10).