Federal Medicaid Funding Still Uncertain

Part of the State budget solution proposed by the Governor and passed by the General Assembly is to receive continued assistance from the federal government for the Medicaid program. Recent reports center on the continued uncertainty over this funding, as federal priorities continue to shift. Washington DC-based public radio station WAMU covered the topic on June 9 (RealAudio link):

D.C., VA And MD Fight For Medicaid Funding

June 09, 2010 – By Manuel Quinones

Maryland, Virginia and the District are fighting to get millions of dollars in additional federal aid to help foot the bill for Medicaid. That’s the health program for the poor. But the measure is facing push-back on Capitol Hill.

Advocates say the $24 billion measure will prevent the poor from paying higher out-of-pocket expenses.

Last year’s stimulus package provided for the federal government to pick up a larger share of Medicaid payments to help states make ends meet. This latest proposal would extend that help.

The District stands to get about $113 million. Maryland would receive $447 million and Virginia $409 million. That’s according to numbers compiled by the group FamiliesUSA.

Executive Director Ron Pollack says states need reassurance as they work on their budgets.

“If they are not secure in knowing they are going to get this extra money, then they are going to possibly have to make some drastic changes,” says Pollack.

Lawmakers scrapped the Medicaid proposal from a tax and jobs related spending package that passed the House. Advocates are hoping for better luck in the Senate. Lawmakers on both sides of the aisle are increasingly worried about government spending.

A recent discussion in the New York Times details the issue facing states across the country, and speculates on the issue’s priority in Congress in the coming months:

The Medicaid provision, which would extend assistance first granted in last year’s stimulus package, was considered such a sure bet by many governors and legislative leaders that they prematurely included the money in their budgeting. But under pressure from conservative Democrats to rein in deficit spending, House leaders in late May eliminated $24 billion in aid to states from a tax and jobs bill that was approved and forwarded to the Senate.

The Senate plans to take up the measure this week, and the majority leader, Senator Harry Reid of Nevada, favors restoring the money, said his spokesman, Jim Manley. The House speaker, Nancy Pelosi, signaled last week that her chamber was open to reconsidering the appropriation.

But state and Congressional officials said the evolving politics of a midterm election year meant that the federal aid could no longer be taken for granted. And if it does not arrive, it will leave gaping shortages for states that are already slashing services and raising taxes to balance their recession-racked budgets.

According to the National Conference of State Legislatures, states are relying on the money to close more than a fourth of the $89 billion in cumulative budget shortfalls projected for the 2011 fiscal year, which starts on July 1 in 46 states.

Michael Sanderson

Executive Director Maryland Association of Counties

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