Medicaid Funding Should Be Included In Potential Economic Stimulus Package

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On Wednesday, New York Gov. David Paterson (D), representing the National Governors Association, called for a new economic stimulus package that would provide "direct and immediate fiscal relief" for states, including a 5% increase in federal Medicaid matching payments for two years, CongressDaily reports (Cohn, CongressDaily, 10/29). Paterson at a House Ways and Means Committee hearing said that a temporary increase in the Federal Medical Assistance Percentage should be provided to "states hardest hit by the current economic crisis." In addition, he called for a new stimulus package to include a moratorium on a regulation that reduces Medicaid payments for outpatient clinics.

Paterson, who noted that his own state faces a $47 billion budget shortfall over the next four years, said that "governors can only cut so much before we begin to jeopardize our fundamental responsibilities to our constituents," such as "providing health care for the most vulnerable" (Reichard, CQ HealthBeat, 10/29).

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According to CongressDaily, "House Democratic leaders appear to be moving toward bringing a $100 billion economic stimulus package to the floor during a lame-duck session the week of Nov. 17." Aides said a package in that price range was discussed on Tuesday and leaders were considering including Medicaid funds, an extension of unemployment benefits, expanding food stamp spending and funding for infrastructure projects (Bourge, CongressDaily, 10/29).

Republicans showed signs of "pushing back" against plans for the economic stimulus package, CQ HealthBeat reports. South Carolina Gov. Mark Sanford (R) testified that a $150 billion economic stimulus package would "dangerously encourage even more growth in governmental programs like Medicaid, which in state budgets across the nation already grew 9.5% per year over the last decade -- certainly unsustainable in our state." He added, "There may be better routes to recovery than a blanket bailout, including offering states like mine more in the way of flexibility and freedom from federal mandates instead of a bag of money with strings attached."

Committee ranking Republican Jim McCrery (La.) said, "We have to a great extent blurred lines between federal and state" responsibilities, adding, "What many are suggesting here today is that we blur these lines further" (CQ HealthBeat, 10/29). Committee Chair Charles Rangel (D-N.Y.) said that "there is no $150 billion package and we will not have any package at all unless the president agrees" (Cohn, CongressDaily, 10/29).

Reprinted with permission from kaisernetwork.org. You can view the entire Kaiser Daily Health Policy Report, search the archives, and sign up for email delivery at kaisernetwork.org/email . The Kaiser Daily Health Policy Report is published for kaisernetwork.org, a free service of The Henry J. Kaiser Family Foundation. © 2007 Advisory Board Company and Kaiser Family Foundation. All rights reserved.

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