U.S. Governors Head for Washington to Press for Medicaid Funds
June 29, 2010, 3:50 PM EDTBy William Selway and Dunstan McNichol
June 29 (Bloomberg) -- Governors of states including New York, Michigan and Pennsylvania will visit Washington to plead with Congress for additional subsidies to help pay for providing health care to the poor.
The event tomorrow, set up by Pennsylvania Governor Ed Rendell, follows the Senate’s failure last week to move a bill forward that included $16 billion in extra funds for Medicaid, the state-run health-care program. The measure, which also was set to extend some jobless benefits, was blocked by Republicans opposed to its cost.
The federal government increased Medicaid subsidies through this year as part of last year’s economic-stimulus package. More than 30 states had counted on the six-month extension contained in the stalled bill. A reversion to the previous subsidy rate on Jan. 1 would deal a blow to cash-strapped states including California, which expected $1.7 billion from the measure.
“The federal government is not supporting the states at the level they supported the financial institutions,” New York Governor David Paterson said in an interview on WOR radio in Manhattan today. New York had expected almost $1.1 billion.
The stimulus measures helped states weather the longest recession since the Great Depression, which battered their tax collections and forced service cutbacks. In total, states have projected budget deficits of $127 billion through 2012, according to the National Governors Association. The added Medicaid funds were expected to narrow those gaps by freeing cash to be used for other programs.
Stimulus Helped
“Had it not been for the federal stimulus funds, state fiscal conditions would have been much worse,” said Arturo Perez, who follows state budgets for the National Conference of State Legislatures. Because the bill stalled, more than 1 million people lost unemployment benefits last week.
In California, among the recession’s most-affected states, Republican Governor Arnold Schwarzenegger’s budget counts on the extra Medicaid money to help close a $19 billion deficit through June 2011.
Senate Majority Leader Harry Reid, a Nevada Democrat whose position lets him control the chamber’s business, said last week that the bill may be considered again should some support emerge from the minority party.
“We can’t pass it unless we get some Republicans,” Reid told reporters last week. “It’s up to them.”
Opposition to Cost
Republicans objected to the cost of the bill, not the assistance itself, said Don Stewart, a spokesman for Senate Minority Leader Mitch McConnell, a Kentucky Republican. The stalled measure was projected to add $33 billion to the federal budget deficit. Stewart suggested the governors appeal to Democrats, “who insist on adding the bill to the national debt.”
Pennsylvania’s Rendell, a Democrat, said 15 governors will participate in the event tomorrow, either in person or by videoconference. “The battle to convince the Congress is still being waged,” he said at a budget briefing in Harrisburg, the state capital.
Gary Tuma, a spokesman for Rendell, said the full list of governors attending is still being worked out, as well as their schedule while in Washington.
California’s Schwarzenegger is scheduled to participate tomorrow by satellite from Sacramento, the state capital.
Kansan Governor Mark Parkinson, a Democrat, also plans to attend, said spokeswoman Amy Jordan. So does fellow Democrat Christine Gregoire, the governor of Washington.
Gregoire anticipated receiving $480 million in additional Medicaid money that won’t arrive if the bill isn’t passed.
“That would mean a significant number of layoffs as well as cuts to social-services programs,” said Karina Shagren, a spokeswoman. “It would be devastating to this state.”
--With assistance from Michael Quint in Albany, Michael B. Marois in Sacramento and Brian Faler in Washington. Editors: Ted Bunker, Mark Schoifet.
To contact the reporters on this story: William Selway in Washington at wselway@bloomberg.net; Dunstan McNichol in Trenton, New Jersey, at dmcnichol@bloomberg.net
To contact the editor responsible for this story: Mark Tannenbaum at mtannen@bloomberg.net.
