Some States See Less To Gain From National Health Reform Efforts

A perceived inequity of state benefits might be a key obstacle to national health care reform legislation, the New York Times' "Prescriptions" reports.

Cornhusker Kickback

For example, the Senate health reform bill (HR 3590) includes a provision that would fully cover the cost of a Medicaid expansion in Nebraska. Senate leaders included the so-called "Cornhusker kickback" to win the support of Sen. Ben Nelson (D-Neb.).

Many state leaders blasted the provision for benefiting only Nebraska instead of all states. During his State of the State address, Gov. Arnold Schwarzenegger (R) said Nelson "got the corn" while California "got the husk."

Nelson has since asked congressional leaders to modify the provision to benefit all 50 states. Such a change would cost the federal government an additional $35 billion over 10 years, according to the Congressional Budget Office.

Medicaid Expansion

Both the House and Senate bills would expand state Medicaid programs to cover an additional 15 million U.S. residents by 2019.

However, many state leaders are concerned about the amount each state would need to chip in to cover the costs of the expansion.

If the reform package offers federal assistance to help cover only "newly eligible" beneficiaries, it would send more funds to states that currently offer the lowest levels of Medicaid benefits, such as Alabama and Mississippi.

California, New York and other states that already offer relatively expansive Medicaid benefits would gain less from the expansion.