House lawmakers,听already more than a week into听their听August recess,听are returning听to Capitol Hill听to act on a听proposal providing states with $16 billion in extra federal Medicaid assistance. The vote,听scheduled for Tuesday, comes after听Senate Democrats unexpectedly听passed听a听state aid package last week, which also听includes $10 billion听to preserve teaching jobs.
Extra Medicaid Funds Began With Stimulus听
With states facing a听recession double-whammy of less revenue and more demand for health care services, Congress included extra money to Medicaid programs in the February 2009听federal stimulus package. Before the stimulus, the federal government鈥檚 share of Medicaid costs was between 50 and 76 percent (depending on the per capita income of the state).听The federal match increased to between 61 and 84 percent of all Medicaid spending. The higher matching rate was originally slated to expire at the end of 2010, but an early version of the jobs bill听extended the funding another six months, at a cost of $24 billion.
Because officials were convinced the money was imminent, 29 states factored the extra money into their budgets for the fiscal year that ends June 30, 2011.
While elected officials,听hospital groups and organizations like the 听pushed听hard for the six month extension, concerns about deficit spending听kept the measure from听being approved.听It was stripped from the House-passed听bill in late May. Democrats inserted it in the听Senate听version,听but it failed to pass 鈥� three times. In June, Democratic leaders unsuccessfully floated a compromise approach that would have phased out the enhanced funding over six months.
Sen. Scott Brown, R-Mass., introduced a stand-alone bill that would offset the cost of the higher matching rate using stimulus funds, but Democrats opposed his approach, maintaining those funds are needed to support other jobs programs.
Governors from both parties argue that the current funding level is critical. Without it, they say they听will face budgetary crises听that will trigger state employee lay-offs and deep program cuts. Some听states 鈥� including 听and Idaho 鈥� are considering revisiting their budgets or tapping into reserve funds to cover the gap, according to a 听by the National Conference of State Legislatures, which endorses an extension of the enhanced Medicaid match.
COBRA Subsidy: Missing From Jobs Bill听
Meanwhile, the prospects for听action on what was once another Democratic health care priority are dimming. The COBRA subsidy provided newly laid-off workers with a 65 percent subsidy to help them stay听on their former employer鈥檚 health plan.听
This assistance听was also authorized in last year鈥檚 stimulus bill and was extended three times, through the end of May,听but now,听workers laid off after June 1 aren鈥檛 eligible.听They听still have the right to stay on听their former employer鈥檚 health insurance plan for up to听18 months, but they must now pay the entire cost of the premium, an expense that is often prohibitive.
A new extension of the subsidy was initially included in the House jobs bill; but because of budgetary and political pressures听conservative Democrats and Republicans forced the听leaders to jettison it. The provision was never in the Senate bill.
On June 24, Speaker of the House Nancy Pelosi 鈥淚 am hard put to pass any more initiatives here unless there is some reasonable prospect of success on the Senate side.鈥�
Sens. Bob Casey, D-Penn., and Sherrod Brown, D-Ohio, are attempting to advance the COBRA subsidy as a separate piece of legislation and would pay for it by eliminating a tax break. Under their plan, the COBRA assistance would be retroactive, giving people laid off since June 1 six months of the federal subsidy instead of the 15 months that the earlier law provided.
In late June,听Brown that while the economy is showing signs of improvement, many workers don鈥檛 have access to affordable COBRA coverage. According to a spokeswoman from his office, he听remains hopeful that some type of听extension will pass this year, though she wasn鈥檛 sure exactly what it might include. 鈥淲ith the Senate schedule still so in flux we鈥檒l just be looking at any potential opportunity to move it. But nothing鈥檚 been nailed down yet,鈥� she said.