Yesterday, the Congress finally passed a
$26 billion aid package designed to help states “open their school years with fewer layoffs” and “pay health care benefits for the poor.” In addition to the education spending, “the bill will send $16.1 billion to state governments to help shore up Medicaid, the joint federal-state health care program for lower-income people.” ““I’m grateful that Congress has passed legislation that will keep Michigan teachers educating our children and ensure that our citizens
have access to health care services,” Gov. Jennifer Granholm (D-MI) said in a stement, echoing the sentiment of state lawmakers across the country. Throughout the recession, states have struggled with lower than expected revenues and rising Medicaid caseloads and some have already
made painful cuts to their health programs or increased taxes.
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While the additional spending package will provide only temporary relief to overstretched state budgets, without the funding, states would have been forced to lay off tens of thousands of employees and cut essential services from fire fighters to care for the elderly and disabled. Medicaid recipients would have had to pay higher co-pays or face strict eligibility requirements. In fact, according to the Center on Budget and Policy Priorities (CBPP), at least
31 states have already “implemented cuts that will restrict eligibility for health insurance programs and/or access to health care services.” In Arizona, for instance, over 1 million low-income residents have “
lost access to Medicaid services offered by the state, including emergency dental services, medically necessary dentures, insulin pumps, airway devices for people with chronic lung disease, gastric bypass surgery, certain hearing aids for the deaf or severely hard of hearing, and prosthetics.”
In February, 47 governors signed on to a
National Governors Association letter urging congressional leadership of both parties to extend the “enhanced federal match for Medicaid (FMAP) for two additional quarters.” “States and territories are in the process of finalizing budgets for FY 2011 that our legislatures will be considering over the next several months. Timely passage of an extension of ARRA’s enhanced FMAP would greatly assist us in maintaining services and further stabilizing the economy,” the letter said.
Significantly, some GOP governors with presidential aspirations have agreed with Congressional Republicans. “It’s
probably not going to help the economy,” Indiana Governor Mitch Daniels said, after initially signing on to the February letter.
Minnesota Governor Tim Pawlenty and Mississippi Gov. Haley Barbour (R) released a similar statements.