U.S. Congress likely to proceed with Medicaid cuts

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Budget leaders in the U.S. Congress say they are likely to follow the lead of President Bush and call for reductions in spending for the Medicaid health program for the poor.

But they said they will give the nation’s governors more time to try to develop their own proposal to stem the growth of the program that provides an estimated 53 million Americans with health insurance.

“We’re forcing the process and we’re setting a schedule,” said House Budget Committee Chairman Jim Nussle of Iowa on Wednesday.

While governors have repeatedly said they oppose negotiating changes to Medicaid as part of a budget process that calls for cuts in the program, Nussle said a tentative deal would push back final decisions until September.

The nation’s governors, in Washington for their annual meeting this week, met with Health and Human Services Secretary Mike Leavitt and key members of Congress, but failed to come up with a proposal to overhaul Medicaid, which has been straining state budgets as well as adding to the federal deficit. They said they plan to continue negotiations in the coming weeks.

While Nussle acknowledged that state leaders needed more time, he defended having a deadline. Without one, he said, “the governors would have said ‘wait until next year,’ and next year would never have come,” he said.

Senate Budget Committee Chairman Judd Gregg of New Hampshire also defended the idea of reducing the rate of growth for Medicaid, which is estimated to cost the U.S. and state governments combined some $319 billion this year.

“I think we all agree the present program is unsustainable,” said Gregg. “A 1.2 percent reduction over 5 years in that rate of growth is hardly significant.”

But even Republican governors are wary about any reductions. “The reality is, with populations moving into Medicaid increasing, and the fact that the cost of medical care is rising at twice the rate of inflation, it’s unrealistic that we can meet not just the needs, but the absolute demands of Medicaid, and do it with less money,” said Arkansas Republican Gov. Mike Huckabee.

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