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Protecting Medicaid
April 26, 2005

Mr. Speaker, I yield myself such time as I may consume to explain the motion.

The House-passed budget directs the Energy and Commerce Committee to cut spending on programs within its jurisdiction by $20 billion over five years. The vast majority of this $20 billion in spending cuts, if not all of it, will likely fall on Medicaid. I, and many of my colleagues in this body, strongly oppose this language. The majority of our counterparts in the Senate apparently share some of our concerns. The Senate approved an amendment by Senators Smith and Bingaman to strike reconciliation instructions in the Senate budget that would have directed the Finance Committee to cut spending by $15 billion over five years, which would have all been from Medicaid. The Senate amendment also created a reserve fund allowing for the creation of a Bipartisan Commission on Medicaid Reform.

This motion protects Medicaid by instructing conferees to follow the Senate’s lead and strike reconciliation instructions that target Medicaid for funding cuts, and instead include a $1.5 million reserve fund for the creation of a bipartisan Medicaid Reform Commission.

Forty-four of my Republican colleagues in the House recently wrote a letter to the Chairman of the Budget Committee, urging him to remove Medicaid reductions in the budget resolution. In this letter they stated:
• “We are concerned that the inclusion of up to $20 billion in reductions from projected growth in the Medicaid program...will negatively impact people who depend on the program and the providers who deliver health care to them...”
• “We strongly urge you to remove these reductions and the reconciliation instructions targeted at Medicaid, and in their place, include a $1.5 million reserve fund for the creation of a bipartisan Medicaid Commission...”

Fifty-two Senators, including several Republicans, voted to strike Medicaid cuts in the Senate budget resolution, and instead allow for the creation of a bipartisan Medicaid Commission. The amendment’s sponsor in the Senate, Mr. Smith from Oregon stated that, “I would rather do this right than do this fast... I don’t know where the [the original Senate cut of] $14 billion came from. But I know what it is going to mean: Another 60,000 Oregonians may be losing health care, pressuring private plans, overwhelming emergency rooms.”

During that same debate, Senator McCain of Arizona stated that “[C]uts to Medicaid that result in reduction of covered individuals would flood hospital emergency rooms with additional uninsured patients, forcing hospitals to absorb additional cost for uncompensated care.”

And Governors are virtually unanimous in their opposition to allowing arbitrary budget cuts to drive Medicaid policy. For example, the Republican Governor of Ohio said, “We do not support recommendations that would save the federal government money at the expense of the states.” Perhaps Arkansas’ Republican Governor stated it best when he said, “People need to remember that to balance the federal budget off the backs of the poorest people in the country is simply unacceptable.”

And the American people agree. Four out of five Americans oppose cutting Medicaid to reduce the federal debt, according to a poll released today by AARP.

Across the country, many hospitals, assisted living centers, and nursing homes have high Medicaid utilization rates and are reliant on Medicaid as a major source of funding. But Medicaid is not keeping pace with the costs of providing health care.

This is particularly true in rural states like South Dakota, which is one of the states hit hardest by Medicaid shortfalls. According to a new report to be released tomorrow, Medicaid long-term care for economically disadvantaged elderly persons is underfunded by $4.5 billion annually.

The results are both real and devastating.

In 2004, South Dakota’s Evangelical Lutheran Good Samaritan Society facilities saw a net operating loss for Medicaid patients of over $3.5 million for the year. In January, the Good Samaritan Society announced it would be closing three facilities in South Dakota.

This means that for some South Dakotans, they will not have access to the medical and long-term care services they need, or they will find themselves moving further from their families in order to find an available facility. This also means the loss of jobs in our smaller communities. And it means as a nation we are failing our poor, our elderly, and our rural communities.

Talk of cutting $20 billion out of the Medicaid system over the next five years is completely at odds with the needs of people in South Dakota and across America.

In fact, a coalition of 135 organizations that represent groups ranging from medical specialties to faith-based groups have asked the conferees to eliminate all proposed reductions in federal funding for Medicaid from the final fiscal year 2006 budget. The letter -- signed by the American Diabetes Association, Catholic Charities USA and other organizations -- said that the "elimination of such cuts is essential for the health and long-term care of Medicaid enrollees, the providers who serve them, and state and local units of governments."

That is why this motion is so important. It protects this critical program by instructing conferees to follow the Senate’s lead and strike reconciliation instructions that target Medicaid for funding cuts. I urge my colleagues to support this motion and to protect Medicaid and I reserve the balance of my time.