Thursday, August 19, 2004
There is no free federal money
["Latest Medicaid bailout plan would provide Ohio at least $225 million if Congress approves," Gongwer News Service, 16 August 2004.]
This is a good follow-up to the Walter Williams piece. If you're drowning, it doesn't make much sense to reach for help from someone else that's drowning. And yet, that's exactly what states are doing with regard to their budgets.
Kansas debt rose faster than any other state from 1992 to 2002 in part due to the rising cost of Medicaid. Some policymakers are still hoping that the federal government will come through with a bailout for the state for fiscal years 2004 and 2005. How will the feds pay for that? Good question. Right now, The White House is estimating that this year's deficit will hit a record $445 billion. Does this seem like a sustainable situation?
[States] would receive...Medicaid relief funds under legislation currently before Congress (S2671, HR4961). Sponsored by Senators Jay Rockefeller (D-W.Va.) and Gordon Smith (R-Ore.) in the Senate, and U.S. Reps. Sherrod Brown (D-Ohio) and Peter King (R-N.Y.) in the House, both plans would provide about $6 billion to states.
The bills would extend the Medicaid component of a $20 billion bailout approved by Congress in 2003. Under both plans, the relief would apply to federal fiscal years 2004 and 2005, with most of the funds coming in the second year. Federal fiscal years begin Oct. 1.
A spokesman for the National Conference of State Legislators, which along with the National Governors Association plans to lobby in support of the bills, said the measures would get more attention after the Nov. 2 elections, and if they pass would likely be part of an omnibus budget bill.
NCSL Federal Affairs Counsel Michael Bird said Monday that Congress has yet to pass any appropriations bills this year, so the Medicaid funds could be attached to a variety of budget legislation. As with the last bailout, states are being cautioned not to count too heavily on the funds, he said.
"It's a wild card at this point, given the uncertainty of the congressional legislative process right now," Mr. Bird said, adding: "This is really a placeholder to be attached to something else."
Mr. Bird said that despite the general opinion that state budgets are in recovery mode, there are still "an awful lot of dead bodies on the playing field" and thus states have a strong argument in seeking additional Medicaid help. "Medicaid is taking on a larger and larger portion of state budgets, practically doubling over the last 10 years with no relief in sight," he said. Medicaid accounted for an average 12-13% of states' general revenue spending a decade ago, and that number has risen to 22% today.
[Matthew Hisrich, "A Backgrounder on Kansas Medicaid," The Flint Hills Center, 19 July 2004.
Matthew Hisrich, "Staying the Course: Medicaid Reform in Kansas," The Flint Hills Center for Public Policy, February 2004.]
["Latest Medicaid bailout plan would provide Ohio at least $225 million if Congress approves," Gongwer News Service, 16 August 2004.]
This is a good follow-up to the Walter Williams piece. If you're drowning, it doesn't make much sense to reach for help from someone else that's drowning. And yet, that's exactly what states are doing with regard to their budgets.
Kansas debt rose faster than any other state from 1992 to 2002 in part due to the rising cost of Medicaid. Some policymakers are still hoping that the federal government will come through with a bailout for the state for fiscal years 2004 and 2005. How will the feds pay for that? Good question. Right now, The White House is estimating that this year's deficit will hit a record $445 billion. Does this seem like a sustainable situation?
[States] would receive...Medicaid relief funds under legislation currently before Congress (S2671, HR4961). Sponsored by Senators Jay Rockefeller (D-W.Va.) and Gordon Smith (R-Ore.) in the Senate, and U.S. Reps. Sherrod Brown (D-Ohio) and Peter King (R-N.Y.) in the House, both plans would provide about $6 billion to states.
The bills would extend the Medicaid component of a $20 billion bailout approved by Congress in 2003. Under both plans, the relief would apply to federal fiscal years 2004 and 2005, with most of the funds coming in the second year. Federal fiscal years begin Oct. 1.
A spokesman for the National Conference of State Legislators, which along with the National Governors Association plans to lobby in support of the bills, said the measures would get more attention after the Nov. 2 elections, and if they pass would likely be part of an omnibus budget bill.
NCSL Federal Affairs Counsel Michael Bird said Monday that Congress has yet to pass any appropriations bills this year, so the Medicaid funds could be attached to a variety of budget legislation. As with the last bailout, states are being cautioned not to count too heavily on the funds, he said.
"It's a wild card at this point, given the uncertainty of the congressional legislative process right now," Mr. Bird said, adding: "This is really a placeholder to be attached to something else."
Mr. Bird said that despite the general opinion that state budgets are in recovery mode, there are still "an awful lot of dead bodies on the playing field" and thus states have a strong argument in seeking additional Medicaid help. "Medicaid is taking on a larger and larger portion of state budgets, practically doubling over the last 10 years with no relief in sight," he said. Medicaid accounted for an average 12-13% of states' general revenue spending a decade ago, and that number has risen to 22% today.
[Matthew Hisrich, "A Backgrounder on Kansas Medicaid," The Flint Hills Center, 19 July 2004.
Matthew Hisrich, "Staying the Course: Medicaid Reform in Kansas," The Flint Hills Center for Public Policy, February 2004.]
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